Property Management Tennessee: Experience Elevated

A 1099 will be issued in January covering the prior calendar year. The 1099 is issued on a “cash basis” and will include any rent paid by the resident during the calendar year. For example, if the resident pays January rent on December 31, the 1099 will reflect the January rent. Please contact your tax professional on how to properly reflect rent on your tax return.

Generally, we recommend that townhomes and condos have a washer & dryer provided by the investor for resident’s usage. Having residents provide their own washer and dryers when the rental property is a single-family home is recommended.

Investors should not attempt to visit the property while the resident is in place. The resident has a legal right to a “peaceful” enjoyment of their property. Even though you own the property, under Tennessee state law, you have given up certain property rights by leasing it out. If you wish to visit the property while it is vacant, please contact our office to schedule a visit with a member of our team.

Unless there is a special situation, residents are responsible for the cost of utilities during the duration of their lease. PURE Property Management of Tennessee will transfer utilities into our corporate accounts with the utility companies between residents. The client is responsible for the cost of utilities during vacancy. Most utilities charge a small fee for a transfer. Some companies do charge a large fee and/or deposit though.

All properties managed by PURE Property Management of Tennessee must meet the current code (set in 2006) for smoke and carbon detectors. If your property is older than 10 years old and an electrician has not updated your smoke and carbon detectors, it is likely that an electrician will have to update them. The cost depends on house size and layout. The average cost is about $600 for a 3-bedroom home. Please note, most detectors that meet code cost around $50 each. Therefore, while Lowe’s/Home Depot sell detectors as cheap at $8 each, these detectors do not meet code and thus are not acceptable.

At the end of the resident’s lease, a member of our staff will do a detailed walkthrough of the home with the resident to identify any damage. We use the information gathered in the walkthrough plus the cost from performing repairs and “rent ready” to determine how much to withhold from a resident’s security deposit. State Law requires that we send residents a disposition within 30 days of the end of their lease. Clients should be prepared to front the costs of repair damage as we cannot use funds from the security deposit until all the damage has been determined.

We collect an amount equal to one month’s rent as a security deposit which is held in our trust account. Sometimes, we require a higher security deposit as part of our screening process.

All properties should have a functioning refrigerator. Properties priced at more than $1,200 per month should also have a functioning ice maker. The lack of a functioning ice maker will decrease the likelihood of renting the property.

In order to ensure that a home is ready to list at the top of the market and ready for a resident to move-in, we send a vendor to perform a complete rent-ready checklist of the home. Depending on the size, condition and age of the home, a normal “rent ready” visit will take between 3-5 hours. When we take over a property for the first time, that inspection and subsequent maintenance work can take additional hours, depending on the property’s condition.

Residents must pay their rent by the 5th of each month to avoid late fees but depending on how weekends or holidays fall on the calendar, they may have until the 7th or 8th to pay. We wait 3 business days after the due date to allow funds to settle in our bank account. Then we’ll send out a rent distribution to clients. Generally, you’ll receive a deposit in your bank account the day after we send out the distribution. This is normally between the 9th and 12th of the month, but there have been situations where the distribution is later due to how the calendar falls.

Due to liability purposes, we cannot manage a property with a pool or hot tub, unless the pool or hot tub is a community pool maintained by a HOA or similar organization.

PURE Property Management of Tennessee does not enter into any management agreement that does not permit pets. Contrary to popular belief, residents with pets are a positive for an investor. Therefore, PURE Property Management of Tennessee allows residents to keep up to two pets with a total combined weight of less than 100 pounds. Residents are screened through a third-party company that guides residents through submission of pet records from a veterinarian that helps determine a pet score. Pet rent is maintained by PURE Property Management of Tennessee who in exchange will provide $5000 against any pet damage recorded at the end of the resident tenure. If the resident has more than two pets or a combined weight of over 100 pounds, we will contact you for approval. If you approve, an additional deposit amount will be collected. If a resident has a pet, we take the cost of regular cleaning and carpet cleaning out of the resident’s security deposit at move-out. For more details about pets, ask our office for our “Pet Policy.”

Each month we publish an owner statement which includes a statement of cash inflows and outflows along with copies of any invoices and work orders for the previous months. This is sent out 1 to 3 days after you receive your rent distribution. This statement should be considered an “interim” statement as this is sent out prior to reconciling bank accounts and deeper review of financials. We also ask that you do not try to generate financial statements off your owner statements as the owner statement does not provide enough details to generate accurate financial statements. For example, the owner statement does not break down how we refund a resident’s security deposit. We have robust accounting features and can send you detailed financials in Excel upon request that will save you significant time.

PURE Property Management of Tennessee maintains a strong roster of vendors with appropriate levels of expertise to perform any issue that may occur. The PURE Property Management of Tennessee maintenance supervisor will assign work orders to the maintenance vendor that fits the situation and has the time to address the issue promptly. All maintenance will be performed by one of our vendors. Due to liability purposes, we cannot allow a vendor on the property unless they have gone through our approval process. This also means that you or your friend who is a contractor cannot perform maintenance on your property while PURE Property Management of Tennessee is contracted to manage that property.

Our policy is to automatically renew leases at an appropriate market rate. We begin the renewal process approximately 100 days prior to the lease expiration. Therefore, if you wish not to renew the lease, please contact our office no later than 4 months prior to the lease expiration. If we do not hear from you by that point, we will try to renew the lease.

Do not panic if your resident pays late. Five to eight percent of residents will be late on their rent in any given month. Remember, residents are generally not in the same fiscal position that you are as the property owner. We use industry’s best practices to ensure that we quickly collect late rent from residents and avoid eviction. For more details about our policies, ask our office for our “Late Fees & Eviction Policy.”

Each property is rekeyed before the first resident moves in and between each resident. We do not provide copies of the keys to the client. If something were to happen at the property, we can provide a record that that client does not possess keys to the property.

We require all residents to purchase $100,000 of liability insurance through our office. The policy covers accidental resident-caused damage (such as kitchen fires or water damage). For more details about resident, vendor and PURE Property Management of Tennessee insurance, ask our office for our “Insurance Information Sheet.”

In Tennessee home inspections are regulated and must be performed by a licensed inspector. PURE Property Management of Tennessee is not licensed to perform a home inspection. If you would like a home inspection performed, we can provide recommendations for licensed inspectors and coordinate scheduling. The cost is generally between $300 and $600 depending on home size and choice of inspector.

Our HVAC vendor performs spring and fall tune-ups’ at all of our properties. The cost of each tune-up is at a contracted price per HVAC unit. We’ve experienced significantly lower HVAC maintenance and longer HVAC system lives since beginning these tune-ups’, thus saving our owners thousands of dollars.

Residents are required to change their HVAC air filters every 30 days. If the residents do not change the filters, they may be financially responsible for HVAC damage caused by dirty filters.

PURE Property Management of Tennessee acknowledges that coordinating maintenance with home warranty vendors can present challenges to getting repairs done promptly with fair communication with the resident. Refer to our management agreement in the Additional Fees and Charges in regard to PURE Property Management of Tennessee fees for working with a home warranty company.

Clients are responsible for paying their HOA dues and maintaining communication with the HOA. If you receive any HOA notices, warnings, or fines, please promptly e-mail it to nashville@purepm.co so we can notify the resident and, if necessary, collect the fine from the resident. If you do not forward us a warning notice and subsequently a fine is issued to the resident, we cannot collect the fine from the resident.

All windows in a property should have appropriate window coverings. Normally, we install 2-inch faux wood on all properties with monthly rent of more than $1,200 per month and aluminum mini-blinds on properties responsible for providing curtains.

As part of our management fee, we perform an annual property survey at your home. The survey is a visual inspection for safety issues and water leaks. There is not a charge for the survey. However, if repairs are necessary, a charge would apply for the repairs. This visit is not an inspection – for more information see “Inspections” below.