The Quirk Group is a group of local Boston residential real estate experts offering services to home sellers, buyers, developers, investors, landlords and tenants. With a team of 7 seasoned agents and over 35 years of combined experience, a few of their agents took some time to answer some common questions for Boston landlords & first-time home buyers!
I have personally rented out my investment properties and it has worked out fine for now, why should I use a real estate agent to help?
This is by far and away the most common question we receive when we begin working with a new landlord client. For starters, experienced real estate agents can provide a suite of marketing, transaction management & strategic services that oftentimes maximize rental returns. Secondly, as we all know, residential leasing is a complex ecosystem of laws (Fair Housing, Security Deposit Law, etc.) and having an expert help you navigate those challenges while simplifying the experience is huge for landlords we work with. Lastly, Boston landlords have a unique luxury, they do not pay brokerage costs (i.e. the “Realtor fee”), tenants do. This means you receive a professional leasing experience at no cost to you as the landlord- they say a free lunch doesn’t exist, but whoever came up with that maxim clearly never rented in Boston!
Ok, so I now know I want to use an agent, how do I go about doing that most effectively?
We have found the most productive representation structure for the landlord is what we call an “exclusive” relationship. What this means in lay terms is that you as the landlord have a dedicated (i.e. exclusive) agent who represents your best interests only. What this allows you & your agent to do is utilize what we call a “wide open” marketing strategy utilizing the MLS to market the property to tenants who are working with an agent already, and unrepresented tenants alike- which we have proven works with many multiple offer situations netting landlords more monthly rent while keeping leasing speed extremely brisk.
You mentioned Security Deposit Law before, isn’t just better to avoid the hassle and not take a security deposit?
Absolutely not, under no circumstances do we advise a client to forego their legal right to take a security deposit at lease signing. This deposit is your “rainy day fund” in the off chance a tenant damages a unit (wall holes, install TV mounts, paints walls, etc.) and if you do not collect one you run the risk of being stuck with fixing damages without any compensation from the tenant. Compliance with laws and the process is quite easy in MA and we handle everything on your behalf except physically going to the bank to set up the account- because we legally cannot do that part! So, it is really a 15-20 minute commitment which could save you thousands in the long run and a no-brainer.
What do you advise for pet policy?
There is a short answer and a long answer here, so I’ll give a bit of insight without giving you the whole enchilada- so to speak. If you are renting in Southie, many tenants (and many good quality tenants we regularly do business with) have every possible dog breed imaginable so we generally try to at least encourage the landlord keep an open mind to pets. There a couple caveats to that: ESA’s & condo association rules & regs. ESA’s are legally certified Emotional Support Animals which are protected under disability law and which must be accepted by the landlord- assuming all other screening checks (income, credit, references, lease terms, etc.) qualify the tenant for the rental. Since many of the units we help our clients lease are actually condos, we have to ensure the pet policy we offer to prospective tenants also complies with those building rules from a breed & size perspective.
What is the best time to rent out a unit in Boston? If I miss prime rental season is it a big deal?
Another good question, in Boston we have the infamous September 1st rental cycle, and the lesser known (but in our opinion just as productive) June 1st rental cycle. If you have the chance to get your rental(s) onto one of those two cycles you will be blessed with zero vacancy and top market rent rates. If you miss those cycles slightly don’t worry! Although we see spikes in the market for 6/1 & 9/1 move ins we generally view Boston as a year-round leasing market with the exception of the holidays. In Southie, most of the units we lease out are available 2/1-11/1 and as long as the pricing strategy & marketing is spot on you should see that dream scenario of multiple offers and the chance to sign a lease for more than we planned for.
Last question for you, what are your thoughts on long term leases (longer than 12 months)?
The tenant pool in Southie is generally speaking what we would call “A grade”, which means you are dealing with a lot of well-paid & clean young professionals that cause very few issues. This means we encourage landlords to consider long term leases, but only up to 24 months and not any longer; we feel 2+ years is a long time for two parties to engage in a residential lease considering many tenants we see moving every 1-2 years. It’s important to know this tactic is employed by savvy tenants and is a product of the highly competitive leasing market they act in. It is a way to attempt to circumvent high switching costs (broker fees, paying movers, move in move out fees) & possible rent hikes upon a lease renewal after a year so you have to be smart when structuring one of these deals as the landlords or it could cost you thousands. In this scenario we first ensure the tenant is the right fit for the unit and the landlord wants to begin building that kind of relationship with them. Then secondly we generally try to help the landlord negotiate what we call a “rental escalation” into the lease, which in lay terms is a baked-in & contractual rate increase that tries to ensure the landlord is always at or very close to market rate for their unit.
If you have any other questions about residential leasing in Southie, Boston or beyond feel free to drop us a line at [email protected]. Additionally if you want to learn more about working with us under our rental program check out this helpful link here which outlines some of the services we offer!
First-Time Home Buyers:
I look at prices currently in Southie and am afraid of “buying high”, what do you think?
This is a fantastic question and top-of-mind for all of our first-time home buyers. While looking at 5-year-trailing charts may discourage you, or make you kick yourself since you didn’t get in before, it’s important to view real estate, and specifically Boston real estate the same way you view your 401k. We use the turn of phrase “it’s not about timing the market, it’s about time in the market that matters”, what that means is look at your real estate purchase as a 10+ year investment, not a 1-2 year investment. Most likely, you are not going to need to sell the property within the next couple of years, and if you do move within the 5-10 year term you will have saved enough for another down payment so you have the choice to either sell the property or rent it out and make passive income! If that wasn’t enough, also look at buying real estate versus the alternative: renting. We all know renting is more expensive than owning, but, what is more important in our opinion is the control owning your condo/house gives you. Never again will your living expenses increase at the whim of another person and never again will you make someone else rich while they sleep!
Speaking of down payments, most Southie condos require over 100k in money down which is something I can’t afford, what do you suggest?
Down payments are not always fixed at 20% of the purchase price, it depends on the loan product you are leveraging, and first-time home buyers can take particular advantage putting as little down as 3.5%. Of course, we advise speaking with a lender before moving forward with that strategy, but there are tons of programs out there which are designed to encourage people to own their own home. Another option is looking at emerging markets where our first-time home buyer clients have had a ton of success finding some amazing deals in areas from Ashmont to Eastie to Medford…. not that we ever want to see anyone leave Southie! The people we have found are generally the most successful in real estate are creative, always learning, and surround themselves with a great team who protect them from risk while assisting them find great values. Whether you are 22, 32, 42 or 82 it is never too late to take the first steps towards financial security with home ownership!
I see condos going up everywhere it seems, what is exactly a condo?
That is an amazing question, since condos are probably the most misunderstood thing in urban real estate and because condos are the most common type of sale we make. Legally speaking, a condominium (i.e. condo for short) is a building with individually-owned units which is then combined with a common (shared) interest in common areas (think of yards, decks, gyms, lobbies, etc.). This means as a condo owner you own everything inside your unit door and share ownership of the common areas of the building. Condos are a great way for urban cities to accommodate large numbers of people living in large buildings while still allowing individuals to own their own space in those large buildings.
Could you outline what the buying process looks like, and how long does buying a home take?
The buying process is generally identical in every transaction we handle but the entire process can take different types of buyers with different objectives incredibly different amounts of time to buy a property. Buying is generally speaking a 6-part process: Searching, Offering, Inspection, Purchase & Sale (P&S), Financing & Closing. Basically how it works is you search for a home (where we come in handy), make an offer(s) on homes you think fit your needs & wants (another place we can add immense value), you inspect the home for defects (unless you waive that right in your offer), you sign the contract (P&S), your bank secures your financing and then you close & get the keys! Most first-time home buyers we work with start their search about 3-5 months before they would ideally like to move into their new home, they like to spend a couple months looking at product before making offers and then from there the remaining 5 steps take the span of 30-60 days to complete depending on what is negotiated.
When is the best time to look for a home?
That is a tough question to answer since it would depend on what the buyer was looking for, and what they were looking to achieve. But, for first-time home buyers looking in Southie or other city neighborhoods we generally encourage buyers looking this year to actually hit open houses starting in late fall/early winter of last year if they can so they can get a better understanding of their preferences so we get be more refined when the Boston market kicks back into full swing in January. However, most buyers will end up offering of properties which are listed sometime from January to May with closing dates 1-2 months in the future from that offer date. The fall market also is busy with less transactions coming together in the September through early November season with closing dates right before the holidays. The real answer though for Boston buyers is every day is a day when possible properties either get listed or are being readied for sale, so that means smart Boston buyers know what they are looking for and follow the market just they would the news, with daily updates and constantly asking questions to learn more.
If you have any questions about the buying process and want to explore working together please drop us a line at [email protected]. We have tons of resources at our client’s disposal and can help you get started whenever you’d like!