By Frank Jachetta
In recent times, the rental landscape has seen a surge in evictions, posing challenges for landlords in collecting judgments from previous tenants. According to the Eviction Lab at Princeton University, eviction rates have risen steadily, with over 2.3 million evictions filed in 2023. Below are five useful strategies to reduce rental losses.
Strategy #1: Require a Thorough Application and Documentation
Collecting proper documentation and a thorough application first will help you reduce fraud, assess a renter’s financial capability to meet rental obligations, and streamline the process of
collecting rent debt. At a minimum, your application should collect name, date of birth, previous addresses, landlord references, employment information, all income sources, and in states where it’s allowed, a social security number. Check with your legal counsel to best
implement a screening policy that complies with your local and federal laws.
Also, consider collecting the following documents from all adults listed on the lease agreement:
✓ Government-issued identification
✓ Proof of income
✓ Recent bank statement
✓ Tax returns
Strategy #2: Check References and Run a Credit and Background Check
Next, review the applicant’s credit report, particularly their total debt, payment history, and collections. Ideally you want to ensure their debt will not stand in the way of paying rent
and that they have not recently fallen behind on payments. Note that nearly all evictions, tax liens, and civil judgments were removed from credit reports in 2017. Make sure you partner with a tenant screening provider that can provide these types of records in addition to a credit report. Lastly, call the applicant’s previous landlords to find out if they failed to make timely rental payments. If your applicant is employed, you can also call their employer’s HR department to verify their status and salary, which can help you further verify the applicant’s ability to pay rent.
Strategy #3: Utilize Lease and Deposit Protection
Lease and deposit protection from TheGuarantors can reduce bad debt up to 70%. Their Rent and Deposit Coverage can help you open doors to more renters – those who might be harder to qualify based on their income or credit history – without the same risk. All at no cost to the landlord, the products help you recover losses due to rent defaults, lease breaks, damages, vacancies, unpaid utilities, and more. In each case, the renter pays for the coverage that gives them access to the home of their choice and minimizes the landlord’s rental income loss.
While this coverage isn’t a substitute for fraud prevention measures, TheGuarantors offers
financial protection should renter fraud occur. According to TheGuarantors, Landlords who
use their suite of insurance services can see up to a 25% increase in lease conversions, because they can help you lease more confidently to non-U.S. citizens, students, recent graduates, freelancers, and thin-credit or thin-income applicants.
Pricing is determined by several factors such as the renter’s risk profile and the gross monthly
rent. It’s free for landlords to sign up and begin referring renters to get coverage. Renters who purchase a policy with TheGuarantors report a 95% satisfaction rate. Take Romey, for instance, a Vice President of Public Relations, who, despite making good money and always paying rent on time, has faced challenges renting due to past student loan issues. He emphasizes that TheGuarantors was instrumental in helping him get a rental, because they recognize individuals beyond mere credit scores, stating: While tenant screening remains crucial, being prepared for worst-case scenarios with a policy from TheGuarantors offers greater reassurance. Their landlord partners have the option of covering up to the entire term and cost of the lease, including missed rent, vacancy loss, utilities, and fees.
TenantAlert provides the ONLY instant tenant screening service with LeaseGuarantee. The credit screening company with options and guarantees.
▪️ Select from a number of reports including credit background check, nationwide criminal, and nationwide eviction.
▪️ Add up to 4 applicants in one order to screen multiple roommates.
▪️ Use your application or send off the TenantAlert application when vetting tenants.
▪️ You can pay for the credit screening or send a link to your tenants for them to pay for the service.
▪️ TenantAlert has easy to read reports with summaries to help you determine if the applicant meets your qualifications or not.
▪️ They rate the applicant on a scale of 100 and offer a lease guarantee for up to $10,0000 of protection against damages, lost rent, or legal fees that you OR the tenant can pay (starting at $199/year).
Strategy #4: Report Your Renters’ Payments to the Credit Bureaus
Reporting positive and negative payments to the credit bureaus is now possible. You can
help your renters build their credit with every timely payment, and if they miss a month, it will
be reported on their credit as well, incentivizing them to keep paying on time. According to The Credit Builder’s Alliance, “Among residents of one pilot group with a history of regularly paying late, those who agreed to have their rent payments reported were more likely than other residents to substantially increase their rate of on-time payment.” In this pilot study, 79% of participants saw an average credit score increase of 23 points, showing that both landlords and renters can benefit from these programs. Note, California’s Senate Bill 1157, has special
requirements for operators of subsidized multifamily units. Check with your legal counsel
to best implement a rent reporting policy that complies with your local laws.
Strategy #5: Implement Late Fees and Online Rental Payments
Late fees deter renters from paying rent late, but it’s important to ensure your policies are clearly written in the lease and that they comply with these local laws. There are several states that limit late fees to 4-10.5% of the rent due and or a dollar maximum. Although most states don’t require a grace period before you can charge a late fee, a 5-day grace period can offer your renters some flexibility which can foster a better relationship. You can also use property management software to accept automated online rental payments to make it as easy as
possible for renters to pay on time. Software can send renters automated reminder emails when rent is late and a bill for any late fees as well.
CONCLUSION
Although you can’t predict the future, you can take proactive steps to prevent or eliminate
rental losses. Before the lease is signed, implement a comprehensive application and screening process to lay the foundation for reliable rent payments. Then, leverage TheGuarantors’ now so that you’re able to recover rental income loss if it does occur. After your renter has moved in,
strategies like reporting rental payment to credit bureaus, enforcing late fees, and offering online rental payments can provide the right incentives to keep rent payments timely for years to come.
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In this episode of Your Landlord Resource, we dive into one of the most critical issues facing self-managing landlords today: tenant fraud. With the rental market becoming increasingly competitive, scammers are finding new ways to deceive landlords, leaving property owners vulnerable to financial loss and legal headaches.
We break down the most common types of tenant fraud, from falsified income documents to identity theft, and share practical tips on how to spot these red flags early. You’ll learn about the importance of thorough tenant screening processes, how to verify the authenticity of documents, and the critical questions you should be asking during the application process.
As a landlord, protecting your property and investment is vital. This episode provides you with the tools and knowledge needed to safeguard your rental business from fraudulent tenants. Whether you’re new to property management or a seasoned pro, the insights shared in this discussion will help you stay ahead of potential scams and maintain a professional and secure operation.
Tune in to ensure you’re equipped with the strategies necessary to confidently navigate the rental market and avoid the pitfalls of tenant fraud.
LINKS
👉 Episode 49: Analyzing Credit Reports for Tenant Selection
👉 Our Preferred Tenant Screening Software: Tenant Alert
👉 Episode 61: Fair Housing and Emotional Support Animals (ESA’s)
👉 Episode 32: Our Lease and Addendum Breakdown, A 3-Part Masterclass
👉 Episode 33: Our Lease and Addendum Breakdown Part 2
👉 Episode 34: Our Lease and Addendum Breakdown Part 3
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By Richard Berger
There are new refrigerant requirements coming for apartment communities in the HVAC field for 2024 and beyond to replace R-22 and R-410a.
For apartment communities, there is massive change ahead regarding refrigerants.
While the changes are not at the technician level yet – and won’t be until later this year regarding behavior and supplies – the financial impact is expected to be huge beginning in 2025, according to Paul Rhodes, founder, Directional Maintenance Services.
In response to regulatory changes, the refrigerant industry has been doing its best to create a refrigerant that will most adequately replace R-22 and R-410a. There are several alternatives, and each presents its challenges for apartment maintenance technicians, owners, and customers.
Last year, the Environmental Protection Agency (EPA) adopted a final rule accepting several refrigerant alternatives for use in new residential and light commercial air conditioners and heat pumps.
So, which one should you use? Well, that depends. The two main reasons refrigerants are being replaced are due to how much they deplete the ozone – measured as ozone depletion potential (ODP) – and much heat they trap in the atmosphere, measured as global warming potential (GWP).
The new refrigerants must have a low enough GWP to meet AIM Act standards.
The Most Common Apartment Refrigerant Replacement Contenders
Currently, the most common replacements to be used in systems designed for R-22 are R438A, which is also known as MO99, R422D, and R421A. These replacement refrigerants are often referred to as being “drop ins.”
“When that term is being used it often means you must change the oil, clean the line set, change the line drier, and then make sure compatible oil is being used,” says Mark Cukro, president of Plus One, Inc. “Think of it this way: An automobile owner could use several types of oil in a vehicle, but it is harmful to mix them or have multiple types in a system at the same time,” he says.
For systems designed to use R-410A, there is no replacement. Instead, the entire system will require replacement to be compatible with R-454B and R-32. These system changes are due to the new refrigerants being slightly flammable and require certain safety measures.
One big change is that both are listed as A2L by ASHRAE instead of the rating that R410A has (A1). The rating change means that due to increased flammability concerns, the new system is not allowed to be mixed with portions of the old system.
What’s Required by 2025
R410A is the apartment refrigerant being used in systems currently being produced. While it has no ozone layer effect, it does have a significant negative rating in terms of climate change, meaning a high GWP. There is no “drop in,” so the price of it will rise, by design, to encourage the change to the newer systems/refrigerant.
These are the systems that the AIM act requires to be no longer used after 2024 to force adoption of the new refrigerants. Parts for systems containing all refrigerant types will continue to be available if repaired and may remain in service.
The new refrigerants found in residential systems required to be produced in Jan 2025 are either R32 or R454B. These are the A2L-listed refrigerants referenced above. They have no effect on the ozone layer and minimal impact on climate change.
Due to this distinction, there is no compatibility with R410A, which leads to the large cost that properties will need to absorb.
Example: If a straight cool/split system condensing unit is to be replaced to an A2L refrigerant system, the property is required to replace the evaporator/air handler as well. In the change from the R22 to R410A systems, if performed correctly, the property would only be required to replace the outside unit.
More refrigerant options are on the way, Cukro says. However, the industry overall has not yet really settled on one refrigerant as “the one” to be the industry-wide replacement, he says.
“Select one replacement refrigerant that suits you best and stay with that,” Cukro recommends, “so you don’t wind up with an unknown number of alternatives in the field that can’t be easily identified.
“While it may be tempting to purchase the least expensive refrigerant each time, if that leads to having six different refrigerants on the same property it may be counterproductive, very costly, and difficult to keep good records,” he said.
“R410a is still the choice refrigerant being used by contractors for new installations. So, keep everything simple to track, easy to work on and purchase, and make sure you have the correct equipment as the safety requirements are updated and change.”
On a positive note, the new refrigerants work quite well, are safer for the ozone layer and have a lower warming potential than the refrigerants being phased out.
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Managing HVAC System’s Service History
The apartment industry will need to adjust and adapt as the new apartment refrigerant replacements emerge, Cukro says.
Rhodes, host of The Maintenance Mindset Podcast, says that in the short term, if maintenance teams know how to properly work with current refrigerants, the impact will be minimal procedurally because the same safe-use rules apply. The cost of materials (refrigerant and systems) will accelerate depending on the supply/demand economics.
Thinking longer-term, at the end of this summer, R410A equipment will begin to sell out as suppliers will not want overstock to carry into 2025. At the same time, manufacturing companies will transition their manufacturing lines to new refrigerants so that they have stock before January 2025. Prices will continue to increase.
Maintenance mobile work order apps such as AppWork help maintenance teams to track HVAC work-order data such as the number of callbacks, completion times, and service ratings. It automatically identifies HVAC work orders from the work-order description and uses that to categorize, prioritize, and even assign the work order, accordingly.
Technicians can include the Freon used during work orders and the Freon levels so the next time a technician works on the AC they can check the unit’s service history to see what they or another technician did the last time the unit was serviced.
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Source Rent.
In today’s fast-paced world, renters have diverse preferences when it comes to apartment hunting. Offering a variety of tour options is key to attracting a wider pool of qualified applicants. Here’s a breakdown of the most popular tour types and how to leverage them:
The in-person classic: building rapport and trust
- The gold standard: In-person tours remain a valuable tool. They allow potential renters to get a real feel for the space, ask questions, and connect with the leasing team.
- Pro tip: Schedule tours during daylight hours and highlight natural light. Be prepared to answer questions about the neighborhood and amenities.
Virtual tours: convenience at your fingertips
- Perfect for long-distance inquiries: Virtual tours offer a convenient alternative for renters who can’t visit in person.
- Maximize impact: Invest in high-quality virtual tours with 360-degree views and narration highlighting key features. Make them easily accessible on your website and social media platforms.
Self-guided tours: flexibility for busy schedules
Catering to busy renters: Self-guided tours allow potential renters to explore the property at their own pace, 24/7.
Ensuring security: Implement a secure access system with clear instructions. Provide detailed maps and highlight important features with signage.
Pre-recorded video tours: a quick look and feel
- Showcasing multiple units: Pre-recorded video tours are a time-saving option, especially when showcasing multiple units with similar layouts.
- Keep it updated: Ensure video tours reflect the current state of the property and highlight any recent upgrades.
TenantAlert provides the ONLY instant tenant screening service with LeaseGuarantee. The credit screening company with options and guarantees.
▪️ Select from a number of reports including credit background check, nationwide criminal, and nationwide eviction.
▪️ Add up to 4 applicants in one order to screen multiple roommates.
▪️ Use your application or send off the TenantAlert application when vetting tenants.
▪️ You can pay for the credit screening or send a link to your tenants for them to pay for the service.
▪️ TenantAlert has easy to read reports with summaries to help you determine if the applicant meets your qualifications or not.
▪️ They rate the applicant on a scale of 100 and offer a lease guarantee for up to $10,0000 of protection against damages, lost rent, or legal fees that you OR the tenant can pay (starting at $199/year).
The power of choice:
By offering a variety of tour options, you cater to different preferences and schedules.
- Highlight your options: Clearly advertise the various tour options available on your website and listings.
- Flexibility is key: Allow potential renters to choose the tour format that best suits their needs.
Remember:
- Regardless of the tour format, prioritize high-quality visuals, clear communication, and a professional presentation.
- Leverage technology to offer interactive elements like 3D floor plans or virtual staging.
- Train your leasing staff to be knowledgeable and engaging during in-person tours.
By providing a variety of tour options, you cater to every click and make your property accessible to a wider range of potential renters. This translates to a more efficient leasing process and a higher chance of finding the perfect match for your units.
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By Kathelene Williams, The Fair Housing Institute
Occupancy limit policies are crucial for managing apartments, whether located in a
densely populated city or a quiet suburb. However, developing and revising these
policies can be complex. Not only do you need to be aware of fair housing laws,
but also know local laws and municipal ordinances on occupancy limits.
How could you hope to balance it all? Better yet, balance it all while trying to avoid that fair housing violation? This in-depth look into not only building your policy but also enforcing it can help you achieve that balance. First, let’s take a look at how occupancy limit policies differ depending on the type of housing.
NAVIGATING OCCUPANCY POLICIES: FEDERAL GUIDELINES VS. PRIVATE SECTOR
Starting with federally funded housing, occupancy policies are already predetermined. You can review the Keating Memo from HUD, which further explains the two person per room rule for this type of housing. However, this rule does not apply to housing such as private market or tax credit.
In all actuality, this rule has been labeled by HUD as possibly discriminatory based on familial status. Because of this, other forms of housing face the challenge of having to create their own occupancy policy and having to undergo constant revision.
BALANCING OCCUPANCY POLICIES: GUIDELINES, LEGALITIES, AND FAIR HOUSING
The best rule to follow when revising or creating your own occupancy policy is that of balance. Using the term balance as your foundation can be a little confusing, so let’s break it down.
A Balanced Policy:
First off, you need to decide upon clear guidelines without creating too much restriction. Top priority must be given to any local laws or any municipal code your property is governed under. Ensure your policy meets their minimum requirements for residents per unit or individuals per room.
The second step is to take a look at your units and your property as a whole. What can the size
and layout of the unit accommodate? Another great tip when revising or creating a policy is
resident details. This may include details such as whether a unit is occupied by all adults or if
there are children residing there as well.
There is an important note to remember when it comes to details for your residents within the
policy. You need to ensure that you do not mention specifics, such as age and gender, in order to avoid a fair housing violation. Sex is a protected category and in many states, age is a protected class.
What NOT to do:
A recent example of a property forgetting these details resulted in a fair housing
discrimination case. An apartment complex in Louisiana had a policy in place stating that two
children of the opposite sex could not share a room. Leasing agents falsely claimed that the property’s policy was based on state law when, in fact, they were discriminating against both age and sex, inciting a fair housing violation.
ENFORCING OCCUPANCY POLICIES: STEPS AND FAIR HOUSING CONSIDERATIONS
Now that you know the foundations of a good occupancy policy, it’s time to understand how to enforce it without inciting a violation. The key first step: make sure you have all the information before proceeding with a lease violation. Once you can confirm that the resident is indeed breaking your property’s occupancy policy, there are a few follow-up steps to take.
Second, follow up on disciplinary measures as laid out by your property’s policy. This may be the requirement for the resident to move to a larger unit or simply cite a violation in the lease
agreement. Remember, as a landlord, you are permitted to enforce your policy. However, there is one fair housing hurdle you and your team should be aware of.
HANDLING ACCOMMODATION REQUESTS WITHIN LEGAL LIMITS
Accommodation requests are inevitable. This includes requests from residents that break policy, including those on occupancy limits. While you want to do your best to ensure that your residents’ needs are met, there is one factor that needs to be considered. No reasonable accommodation can supersede local law or municipal codes. As an example, let’s say a resident submits an accommodation request stating that they need to break policy on a certain unit’s occupancy limit. If that policy is based on local laws stating how many individuals can be in that size unit, you will have to find a different solution for that accommodation. If the request does not break any local laws, then it is safe to follow your property’s procedures to accommodate that resident.
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KEY TAKEAWAYS FOR EFFECTIVE OCCUPANCY POLICY MANAGEMENT
In short, balance is key when it comes to any kind of policy. In the case of occupancy limits, balancing both fair housing standards and local laws and ordinances when taking a look at your policy is the best course of action. If you’re starting a new policy or revising one currently in place, there are a few key steps that should be on your checklist:
✓ Ensure your policy is clear and concise but not too specific. Take care to avoid
discriminating against certain protected categories and classes. As shown in the court
case discussed earlier, these kinds of details in your policy can lead to a fair housing
violation.
✓ As a property manager, it is your responsibility to enforce your policies. Be careful when
investigating, documenting, and explaining any lease violations you carry out.
✓ Reasonable accommodations that violate your property’s policy can happen. Ensure that
whatever the request, it doesn’t break your state’s laws on occupancy limits.
Remember, balance is key to any property with these policies, no matter the location. Let this guide help you to ensure that your occupancy limit policy meets Fair Housing standards, keeping your residents safe in their homes and locking in that property management win.
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So, we all know that cash flow and appreciation are two things’ investors are concerned with when buying rental properties.
Once you find a property, what EXACTLY should you be evaluating with regards to the neighborhood and the property itself before making an offer?
We are sharing our due diligence for the neighborhood to see if it’s a good fit for our strategy and checks all the boxes as well as the steps we take to do an initial inspection of the structural integrity of the property itself.
This week we are going over the process we are taking to break down all of the things we consider before we will even make an offer on a new investment property.
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Provided by Bigger Pockets
The question is asked all the time: How can I estimate average rehab costs? Well, there is no average rehab cost because there is no average rehab.
Some properties will need major structural modifications; others just a lipstick approach. Some may have a recently remodeled kitchen, and others may have a 1950s galley kitchen.
But since this is such a popular topic, let’s see if we can try to make it at least (a little) feasible for a newbie to the construction world.
Ways to Go About It
First, there are several ways to get a price range for needed work on a property:
- Have a general contractor walk the property.
- Have a home inspector give you a report and use that to put together a budget.
- Develop a square footage cost per square foot for the whole project.
- Develop a square footage cost for each trade, like tile and drywall.
- Use an online calculator.
- Ask friends for help—ones that have had a recent remodel or may have some kind of construction experience.
Who to Work With
Of course, the best and by far the safest way, in the beginning, would be to use a veteran general contractor (GC) to walk the property and throw a rough number at the necessary and/or desired repairs or improvements. This is certainly possible, but most contractors will expect to be paid, and they cannot always fit such a small task (for them) into their schedule because you have a deadline due to escrow.
And note that I used the term “veteran” in describing this GC. It does you no good to use a new or young contractor fresh out of the exam room. You need someone with decades of experience, who can throw out a semi-accurate price just by looking at a property in an hour. They must have done dozens or hundreds of projects to be able to throw out an accurate price after a one-hour walk-through a house they have never seen before.
Note: You can (and many do) find a good general contractor who will walk every property for/with you and always give you a good, solid number. But be mindful that everyone—even this veteran old GC—can and will be wrong on occasion. Or sometimes, there are surprises hiding in the house that you will not see until demo is complete, or the building inspector makes his first visit to the property.
You can also use a home inspector to gather a list of information on needed repairs and deficiencies. You will (and should) use a licensed home inspector to inspect the property that you are considering purchasing. You do this once you have an accepted offer on the property, it is under contract, and you are within the inspection period.
But they can’t and won’t be able to throw a number at those tasks for you. It’s just not their job. Home inspectors are specialists, and most will have no true construction background. They might see it as opening themselves up to liability issues or, worse yet, a conflict of interest.
How to Calculate Costs
However, once you have this list, it’s certainly a good starting point. Then, you can use the internet to attach a price to each item on their report. This is a sensible and fairly safe approach.
But what about additional improvements you might want to have done, like adding a bathroom or remodeling the kitchen? Maybe you’d like to open up an old, claustrophobic house and convert the living room, dining room, and kitchen into a great room. Now you’re back to square one.
Develop a square footage cost. This will take longer, but as you complete a few jobs, just do the math and keep track of what you are paying. Does the tile contractor always seem to get about $5 a square foot for his installation? Does the drywall crew always end up at about $6 a square foot? These are real-world numbers that you can rely on.
You can also try to contact various subs and see if they will give you this square foot price. Some will, but many will not want to be bound by it.
There are online calculators out there, even one on the BiggerPockets site. They can be of some use, but I would warn not to completely rely on these. They cannot always account for different areas, or current price fluctuations, or a sudden change in the economy. But they can be very handy in assisting you get together a well-priced scope of work.
Ask people that you know and trust about their recent projects. Maybe you’ll get a good price on kitchen cabinets from one friend, and another will let you know what she paid to have her bathroom retiled.
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How to Customize Your Approach
I would suggest using a different approach for different sizes and types of projects. For example:
- You find a house that needs a complete remodel, right down to the studs. This will absolutely demand that you hire a GC to go to the site and walk it (with you there to watch and learn) and give you a rough price. You cannot be off by 20% on a $150,000 remodel project—there goes your profit, and that might actually turn into a loss. That’s not why we got into the business.
- You’ve found a nicely priced older home that has been well cared for, but nothing new or modern has been done to it in 30 years. It needs a modern kitchen, two new bathrooms, new flooring and paint, and a new roof. That’s maybe $45,000 worth of work. Once again, you can call the GC, or in this case, you can call subcontractors yourself and ask for prices on each trade. How much is the cost of cabinets? How about paint, tile, flooring?
- For a small job, $10,000 or so, possibly needing only paint, carpet, and new appliances, measure (very carefully) and go shopping yourself. Don’t forget to include all costs like taxes, delivery, installation, and the like.
It can be a sound approach to use a variety and combination of these possible choices until you find the most comfortable way for you to come up with a price range that you are willing to invest.
And it must be noted that, as you would expect, prices vary greatly by region, from state to state, and even city to city within a state, i.e., San Diego versus Los Angeles or San Francisco, or New York versus Buffalo.
Final Thoughts
The more you get your hands dirty and invest some of your own elbow grease in this process, the better you will get at estimating prices. It’s not easy, and yes, you can make mistakes that can cost a lot of money. But it is absolutely invaluable to be able to walk through a prospective fixer-upper house and put a pretty firm number on your construction costs. This will set you apart from your competition and should help you become profitable—there is a lot of money to be made in fixing up distressed houses!
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By Lauren Wingo
Dealing with an outside AC unit not turning on can be frustrating. Here are a few reasons why it could be happening and how to handle it.
Q: Living in a Southern state, we have the AC on for much of the year. But when I went outside earlier, I noticed that the outside AC unit wasn’t running. Why is my outside AC unit not turning on, and how can I get it working again before my house becomes a sauna?
A: During the hot summer months in particular, homeowners rely on their AC unit to stay cool. So, when an outside AC unit isn’t turning on, it’s essential to figure out why and find a solution as soon as possible.
Even the best air conditioners can have mechanical issues from time to time. If the AC unit has a split cooling system, two pieces allow the AC to turn on: an indoor evaporator and an outdoor compressor or condenser. If both pieces aren’t operating in tangent, the AC won’t turn on or produce cool air. Whether the AC outdoor unit turns on and you can’t feel it working, or it’s not starting at all, don’t worry—there are a few different things to try to get it working again. And if all else fails, you can contact one of the best HVAC companies (such as One Hour Heating & Air Conditioning or Aire Serv) to come out and fix the issue ASAP.
1. Make sure the thermostat is on, set to cool, and working correctly.
If the air conditioner is not cooling or isn’t even turning on, the first thing to do is examine the thermostat and see what temperature it has been set to. Someone else in the household could have raised the indoor temperature or turned the thermostat off entirely.
If it’s off, simply turn the thermostat back on, ensure it’s set to cool, and change the temperature to five degrees lower than what the ambient temperature of the room feels like. If the room starts cooling down, there most likely isn’t an issue with the outside AC units.
If it still doesn’t seem to be working and the thermostat is battery-powered, try replacing the batteries with fresh ones. Contact a specialist to examine if the wiring has gotten crossed or pests have chewed through the wires inside the wall.
2. The shut-off or emergency switch might be flipped.
Several sources of power an AC unit has that could have been accidentally turned off if the air conditioner is not turning on. Since the air conditioner outside unit has a different power source than an indoor AC unit, go outside to where the unit is located. Next to the unit, there should be a place that houses an emergency or shut-off switch. Someone could have left this switch in the “off” position accidentally. Ensure everything is plugged in and switched to the “on” position before going inside to see if the problem has been fixed.
There also may be a reset button on the outside AC unit that can be pushed. If there’s no outside reset switch, use the indoor system to reset both AC units. Turn off the breaker or thermostat and wait at least a minute before turning it back on. After it’s been reset, check to see if the outside unit powers back on and the room is cooling down.
3. Check the circuit breaker and see if there is a blown fuse.
There could have been a blown fuse to the circuit breaker that caused the outside AC unit to stop working correctly. A blown fuse is caused by an overloaded circuit breaker, which can happen if the AC unit is overworked or the wires are loose and aging.
Head to the home’s circuit panel and check to see if any breakers have tripped. Next, turn them off then back on again. There may be an electrical problem if the breaker immediately trips once it’s turned back on, in which case an electrician will need to assess the situation. It’s important not to turn the circuit breaker back on again, as it could further damage the outside AC unit or other household appliances.
If the home has a fuse box, replace any fuses that appear to have blown. The home’s AC unit may also have its own shut-off box. If the fuse is blown there, an HVAC contractor will have to replace it.
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4. The capacitor might be failing.
A capacitor holds the energy that the AC unit outside needs to power on. There may be a buzzing noise coming from the outside AC unit if the capacitor fails because the AC condenser fan is trying to spin without power from the capacitor. An AC unit has two capacitors: a run capacitor and a start capacitor. A start capacitor provides the first push to spin the condenser fan. A run capacitor varies between two subtypes, a single run and a dual run.
No matter which capacitor a home’s AC unit has, they age and wear over time, causing it to fail. Overwork, extreme heat, or power surges can speed up this process.
To test whether the capacitor is failing, attempt to spin the condenser fan using a thin piece of wood to avoid pinching fingers. If it’s a dual-run capacitor and the AC fan starts spinning, there may be debris or dust in the AC fan motor, or the AC fan motor is damaged. With both single and dual capacitors, if the AC fan doesn’t spin at all, the capacitor has most likely failed.
5. There might be a problem with the condensate drain line.
An AC condensate drain line works by eliminating the water built up when the AC’s evaporator converts refrigerant from liquid to gas. If it’s not cleaned, algae and grime can build up in the drain line.
A line can also get clogged due to high humidity. Once it’s clogged, the line will trip a safety switch that turns the air conditioner off. To unclog the condensate drain line, turn off the HVAC unit and use a wet/dry vacuum to clear what’s clogging the drain. If the problem persists, seek a professional’s assistance to minimize damage.
6. The unit may be low on freon.
Freon is a chemical refrigerant that cools warm or hot air from the outside before entering the home. Freon usually runs through a closed loop within the home, meaning that there’s most likely a leak within the system if the unit is low on freon. This can cause the AC to stop working. Signs of a leak include ice buildup on the outside unit, only warm air coming out of the vents, and a hissing noise near the AC, signifying a more extensive leak. Since refrigerants can be dangerous to handle, the Environmental Protection Agency (EPA) requires a licensed professional to purchase and handle refrigerants.
While there are many reasons why an outside AC unit may not be working correctly, there are steps to pinpoint the problem. Once the issue is discovered, be sure to consult a professional who can assess the damage and safely restore the system to normal. In the meantime, consider investing in one of the best portable indoor air conditioners to stay cool while the AC is not functioning.
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Source: Apogee Capital
Ever since we started investing in real estate, we had friends approach us and share how they too were interested in investing in this type of asset class. After a number of these interactions, we began to see a pattern in the conversations.
Someone would begin the conversation about how they had heard about the benefits of real estate but they did not have the time to manage a property, patience to deal with difficult tenants or knowledge to identify a profitable deal.
Having been landlords of single-family homes ourselves, we understand firsthand the challenges these individuals were considering. We have seen many people who have made a real estate purchase that did not turn out as they expected either because of problems with the property or tenants. This resulted in them not achieving their expected returns or simply being more stressed and frustrated than what it is worth.
One alternative to this dilemma is passively investing in real estate deals.
There are numerous ways to do this, but we want to mention just a few of the benefits specific to passively investing in a commercial multifamily property. First, you have the economies of scale that come as the result of investing in multiple units. When you are invested in say 50 units instead of 1, should one of the units be vacant for an extended time or a large expense come up you still have 49 other units producing income during this time. This means that you are losing 2% of your income instead of the 100% that you would lose if this happened with a single house.
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Secondly the acquisition, management and disposition of the property can be handled by knowledgeable professionals. When you are flying in a plane and suddenly enter an area with large turbulence, you do not start saying “I sure wish I was piloting this plane right now!” Why not? Perhaps because the plane is being flown by a pilot who has the knowledge and experience to successfully navigate this difficult scenario and your safety is truly best placed in his hands.
While investing is certainly not too difficult for any individual to learn, there are strong merits with placing your hard-earned money in the care of those who best know how to handle the turbulent situations that are sometimes encountered in real estate investing. Multifamily investing employs a team of professionals that includes not only the syndicator but also the property manager, real estate attorney, CPA and others.
Finally, multifamily offers the opportunity to passively invest in a recession proof asset class. Based on a CBRE research report, “multifamily rents have outperformed those of the other major property sectors during and after the 2008-2009 recession in three ways. The sector experienced the lowest level of rent decline, the fastest recovery to pre-recession peaks and the longest post-recession period of rent growth.”
We know that people have to have a place to live which supports the demand for attainable housing regardless of economic conditions.
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