Avoid poorly-managed apartment buildings by following these tactics.

With enough money, an investor can purchase a property and attempt to become a landlord for additional income. However, lack of property management experience can negatively affect potential tenants. Even the most stunning properties with upscale amenities are susceptible to poor leadership, which is why potential applicants can’t rely on aesthetics alone.

To fully assess a potential rental, including its internal operations, consider the following tips.

Complete your due diligence

First begin your apartment search process based on your locale. If you live in a big city, online listings and agents might be the most helpful and legitimate route. Small town residents may find more luck via word-of-mouth marketing. Either way, narrow down your prospect pool by asking friends and family for trustworthy recommendations.

“When searching for an apartment I always start with referrals. In other words, I check with my friends, family and coworkers to see if they like where they live and if they would recommend their complex to others. Secondly, I ask those same people if they have heard of openings for apartments that would suit my needs. Lastly, I take my search online so that I can find as many available apartments as possible, and then narrow them down to my desired location and price range.” — Derek Sall of Life and My Finances

Enlist professional help

With today’s technology, many renters assume they can sign a lease effortlessly. On the contrary, leasing agents play a key role in successful negotiations, all while providing decision-altering disclosures. They are highly familiar with their specific market, including average rental prices and landlord reputations.

“The real estate agent we eventually chose took 10 minutes to ask about our lifestyle, our preferences and our hobbies. She was able to help us find an apartment in an area that fit our tastes and sensibilities because she knew what we were like. Someone who can match you with a living situation that fits your lifestyle is valuable.” — Miranda Marquit of Planting Money Seeds

Ask previous tenants

Some landlords, reputable or not, might boast about their buildings to sign quality applicants. To learn their true standards and practices, ask previous tenants.

“I think online research is key, but you also need to find someone who lives in the building — even if it’s just a friend of a friend of a friend. Find out what they like and dislike about the place, and see how that fits with your own needs and expectations.” — Taylor of Repaid.org

“I’m gearing up to look for an apartment in the next few months and I’ll definitely be researching management companies before signing a lease. With that said, it’s important to remember that a lot of the reviews online are those of people who have had exceedingly negative experiences — and are self-reporting their issues. I’ll be doing online research, but if I have a recommendation from a friend, it’ll be a lot more meaningful.” — Chris Sonzogni of GenFKD

Understand your lease

Plenty of properly managed apartment buildings enforce rules for all tenants. While they won’t hit you with any non-disclosed fees, they’ll likely keep their lease terms consistent, no matter your personal circumstances.

“[Management wasn’t] helpful with giving us our deposit back early because we moved out two weeks earlier than planned.” — Aaron Crowe of Add Vodka

Just as homeowners fall behind schedule with home improvements, so do landlords. Typically, if a lease includes promises for upgrades, a strict timeline is omitted.

“My landlord didn’t check materials and we ended up having to redo the kitchen twice. The refrigerator door couldn’t even open due to the wrong cabinets. The contractor had to change the floor, cabinets, countertops, lights [and] so many things. The landlord gave me a discount on my rent since we were basically living in a construction zone all summer. But in the end, the house was beautiful!” — Will Lipovsky of First Quarter Finance

Establish communication

It’s difficult to determine honesty until an issue arises. But, you can attempt to assess a landlord’s management style during the lease signing period. The initial email exchange and phone calls when inquiring about an apartment are strong indicators of their overall responsiveness. Do they forget to call you back? Do they have floor plans available? Are they willing to negotiate?

“Here in New York, I’ve had a few minor issues with my management company, likely stemming from the fact that they handle so many more units than my previous one. One of the things that I’ve found is that it’s almost always more effective to pick up the phone and follow up with an email than to simply wait for a response.” — Chris Sonzogni of GenFKD

“My tenants are able to call/text me at any time and let me know if anything comes up. I appreciate the open communication we have as I will sometimes check in to see if there are any issues that need to be looked after. As a result of this, my tenants tend to stay for long periods of time.” — Dan of Our Big Fat Wallet

Slumlords exist. Take the initiative and review all of your renting options to protect yourself and your wallet.

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About the author

Jennifer Riner

Jennifer Riner writes about rentals, home improvement and design for Zillow Blog.

When it comes to real estate listings, the picture you're painting with certain words can be worth thousands of dollars.

First impressions matter. When it comes to for-sale listings, the first thing most buyers see is a home’s description. But not all listing descriptions are created equal.
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Based on an analysis of 24,000 home sales in “Zillow Talk: The New Rules of Real Estate,” co-authors Spencer Rascoff and Stan Humphries reveal listings with certain keywords send negative signals about a home’s quality and features. These listings tend to sell for less than expected.

“If you’re not careful, picking the wrong adjective could cost you time, money, and in some cases, lots of both,” they explain.

Check out the nine most dangerous listing descriptors below.

1. Fixer

The word “fixer” implies “fixer-upper.” While a fixer-upper may not seem out of place among lower-priced homes, most buyers expect mid- and high-priced homes to be move-in ready. The numbers back this up. Among the 24,000 home sales analyzed, listings in the mid-price range with the word “fixer” sold for 11.1 percent less on average than expected.

2. TLC

“TLC” falls in the same camp as “fixer.” However in this case, both low- and high-priced homes took a hit when they were described as needing tender loving care. Listings in the bottom tier that mentioned “TLC” sold for 4.2 percent less, and homes in the top tier mentioning “TLC” sold for 8.7 percent less on average than expected.

3. Cosmetic

While you may think you’re putting a positive spin on “needs work” by saying a home needs “a few cosmetic updates,” a buyer likely doesn’t want to hear this. On average, high-priced listings with the word “cosmetic” sold for 7.5 percent less than expected.

4. Investment

While someone looking to buy an investment property might like to see the word “investment,” for the majority of home buyers it signals a home has seen better days. Low-priced listings described as an “investment” sold for 6.6 percent less on average than expected.

5. Investor

Like “investment,” “investor” is a great word for attracting someone who is looking to flip or rent out a property. But for home buyers, it can imply a home is rundown and cheap. For high-priced homes, this might make buyers think there is room to negotiate. And data shows top-tier listings with the word “investor” sold for 6.6 percent less on average than expected.

6. Potential

You might see a home described as “having potential,” but this signals it isn’t a finished product. You don’t want to communicate this to buyers looking for a move-in ready home. In fact, lower-priced homes with “potential” in the listing description sold for 4.3 percent less on average than expected.

7. Bargain

As soon as we hear “bargain,” we’re unfortunately wired to think the opposite. If you think your home is a great deal, a good rule of thumb is to let the price speak for itself. Mid-priced homes described as a bargain sold for 3.5 percent less on average than expected.

8. Opportunity

While high-priced homes may be described as an “opportunity to live on the water” or an “opportunity to live like royalty,” the context isn’t typically so positive in listing descriptions for low-priced homes. In this case, you might expect to see “house-flipping opportunity” or “investment opportunity,” which can have negative connotations for buyers. Listings in this price tier with the word “opportunity” sold for 2 percent less on average than expected.

9. Nice

Like “opportunity,” the word “nice” typically has a positive meaning in listings for high-priced homes — “nice view” or “nice wine cellar,” for example. But for low- and mid-priced homes, “nice” is highly subjective, especially if it’s used generally to say “a nice home.” The buyer is left to interpret what “nice” means. Likely because of this ambiguity, low- and mid-priced listings with the word “nice” sold for about 1 percent less on average than expected.

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About the author

Catherine Sherman

Catherine Sherman covers the people, places and trends that shape our idea of home.
 
 
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Whether you live in a tiny home or your rooms are just on the small side, you can make the most of your space with these tricks.

Plenty of people live in tiny homes, small rooms, or just diminutive spaces. No matter what your reason for living in smaller quarters, you’ll undoubtedly have to make some compromises in your decorating.

To live happily and efficiently in smaller square footage, you’ll want to get organized and make some adjustments to your lifestyle. By making the most of color, strategic furniture buying, space planning and interesting lighting, your place can feel wonderfully “you” — with all the space you need.

Expand your square footage to the outdoors

If you have large windows with beautiful views, add those colors to your room to unify the outside world with inside space and expand the look of your rooms. With the wonderful patterns and colors that outdoor fabrics offer, there is no reason to stop the “pretty party” at your interior.

Carrying coordinating materials outside for drapes, cushions and area rugs will only make your space look visually larger. On the interior, let as much natural light into a room as possible so it opens up the space and gives it character.

Edit mercilessly

Declutter your space. Try to dispose of everything you have not used for a year. Do not get attached to furniture. Get rid of any item that is not adding to the look of the room.

Create organized storage wherever possible via built-in benches and use multi-purpose and storage furniture pieces, such as ottomans, so items that are less frequently used can be stowed away.

bench
Source: Kerrie Kelly Design Lab

When it comes to cabinets and bookcases, do not fill up every shelf in a room; leave some of them half empty and spacious for an airy and more dramatic look.

Where functional, remove as many doors as possible or use pocket doors to increase the sense of space.

Keep it simple

Link adjacent spaces with a unifying wall color and floor material. Maintaining a monochromatic palette makes rooms look bigger. If you do need to change flooring materials, simply stay within the same color family — the fewer floor “breaks,” the better.

Light colors or neutrals are space expanders and provide a neutral background for furniture and artwork.

simple kitchen
Photo from Zillow listing.

Using cool colors will make your walls appear to visually recede. Additionally, it is best to avoid unnecessary details, such as ruffles, in furniture and window treatments. Use simple paneled draperies or shades instead.

Make a statement

Installing an oversized mirror or a set of smaller mirrors will add extra light, sparkle and make a small room appear larger. Even if a room is small, adding oversized artwork on a small wall or a statement light fixture overhead can create drama while making the space appear larger than it is.

You may also consider adding a floor-to-ceiling and wall-to-wall bookcase — this trick will create an impressive focal point and visually expand space by pushing the walls and ceiling out.

What tips have you successfully used to make your small space look larger?

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About the author

Kerrie Kelly

Kerrie Kelly is a Northern California interior designer and the founder of Kerrie Kelly Design Lab.She is an award-winning interior designer, multimedia consultant and an author of two books: “Home Décor: A Sunset Design Guide” and “My Interior Design Kit,” with Pearson Professional and Career Education.
 
 

A good credit history can save you money in lots of ways. Here's one that might surprise you.

By Shannon Ireland 

Want to know a (mostly) secret way to lower your home insurance premiums? One that could also reduce your mortgage, and even affect how much you pay for your car and car insurance?

It’s really not a secret, nor is it magic. It’s something anyone can do: maintaining a good credit score.

Your credit history affects more than your credit

You likely know and understand how your credit history figures into the decision when you apply for a credit card or try to open an account at a clothing or furniture store. The credit card company or store wants to make sure you have a history of paying your bills on time.

And you probably know car dealers run your credit when you want to buy a car. What you might not know is that your credit history plays into the interest rate you’re offered — which affects the total payback on your loan.

The same applies to your home loan. Your credit will affect the interest rate for your mortgage, and the difference in that interest rate over a 30-year loan period can add up to tens of thousands of dollars.

Insurance companies have a different reason for examining your credit report. They don’t look at it to calculate your risk of paying your premium — you always pay in advance of coverage anyway. What they do use your score for is to determine your risk of filing a claim.

Yes, that’s right. Insurance companies have, since the early 1990s, used your credit reports to predict the possibility that homeowners will have a fire, suffer a break-in, have a tree fall on the roof, or be the victim of some other covered peril. They do the same for auto insurance policyholders.

Only three states — California, Hawaii and Massachusetts — ban the use of credit scores in setting insurance premiums.

What’s the correlation?

Insurance companies started using credit histories to determine premiums because studies have shown that those with higher credit scores file fewer claims. Insurance companies believed that using the credit-based scores would help get more accurate and fair rates for policyholders — in fact, the industry says it actually results in lower premiums for most policyholders.

However, many consumer groups criticize the practice because they believe it penalizes those that have previously run into medical emergencies and financial difficulties, and unfavorably affects low-income and minority customers.

How much does a credit score affect premiums? A study by the Consumer Federation of America found that one large provider charged poor-credit customers about 127 percent more than policyholders with the best credit scores.

What can you do?

There’s no quick fix for a bad credit score. It takes time and discipline to pay bills down while avoiding new debt. But given the potential for saving on your mortgage and your insurance premiums — as well as on car and other large purchases — it’s worth the effort.

One step you can take immediately is to check your credit report and correct errors that could reflect badly on your score.

Take charge of your finances by building a good credit history and improving your credit score. You can save a bundle — now and in the future.

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Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.

About the author

HomeInsurance.com

HomeInsurance.com is an online resource for homeowners and drivers across the country. Offering comparative automobile and home insurance quotes, consumers rely on HomeInsurance.com for the most competitive rates from the top-rated insurance carriers in the country. The HomeInsurance.com blog provides fresh tips and advice on a range of financial topics to help homeowners and home buyers make educated decisions about their insurance purchases. 

Don't be taken by surprise when closing rolls around. Escrow payments can make a big difference in your finances.

When you are buying or refinancing a property, you will get a good faith estimate around the time you go into escrow. The estimate will include a line item for escrow account information — also called property tax and insurance impounds.

These are monies that might be added into your monthly mortgage payments to cover property taxes and insurance. The lender may require them, or it may be an option for you. Here’s a look at the details.

Easy come, easy escrow

In the past, a home buyer would borrow money for a home and make monthly payments to the bank. In those days, a borrower would separately pay their insurance and property taxes throughout the year when the bills came due. Unfortunately, sometimes mortgage borrowers with errant budgeting habits and free-spending ways would end up short of money when property taxes were due.

As a result, lenders started offering (or sometimes requiring) borrowers to pay those property taxes and insurance monies into an escrow account on a monthly basis. When those bills were due, the lender would pay them on behalf of the borrower.

The lenders also did this to earn interest on those funds. When hundreds of thousands of escrow accounts are combined, the result is a lot of money, and a lot of interest. Over the years, some lenders began requiring the money upfront, some would give a quarter-point discount on a mortgage interest rate if the borrower escrowed their taxes and insurance, and some would give the borrower a choice.

Borrowers would have to put up a large amount of additional cash at closing to start an escrow account — sometimes up to six months’ worth of property taxes — and they might not be thrilled about the interest they’d be losing by not having those funds invested.

Due to those issues — and especially in cases when there isn’t a discounted interest rate for escrowing funds — most borrowers decline to escrow those monies.

What’s best for buyers?

For most people, escrowing taxes and insurance is a great way to go, especially for first-time buyers and/or buyers who are tight on funds. Since most of us do not sock away money in a separate account for property taxes and insurance, we get clobbered at property tax time. It’s much better to budget and save that money throughout the year, and escrowing these funds with the lender is a great way to force yourself to accomplish this goal.

Ultimately the choice is yours, but it sure is nice to get to property tax time and know you don’t have to come up with a large amount of cash to cover those bills. Since you’ve already saved those monies along the way, you should have a stress-free month while others are scrambling to pay the bills.

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Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.