Divorces stink. No way around it, and no matter how cordial everyone’s trying to be. The easiest divorces are usually those where there are no kids, no wealth and no real estate involved.
Add any – or all – of those three into the mix, and it suddenly gets very complicated. No matter how well you used to communicate, or how much you once trusted the other person, questions can start popping up….
A divorce when real estate is involved can get nasty really fast. Who’s in charge of the day to day management? Who collects the rents? Who pays the bills? Who’s pocketing money or squandering it on personal – not business – expenses? Is the property for sale – and if so, who’s hiring the broker, and who’s agreeing to the listing price? Are the lawns being mowed? Are the furnaces being maintained? Are the units being filled? Are those bills really being paid?
We know of several situations in which a divorce dragged on and on not because of arguments over the kids or someone’s affair or who gets the house… but because of the real estate. Even when it’s in one partner’s name, fights over real estate can get very messy, and keep a divorce in the courts for far longer than is good for anyone (except the lawyers).
If you own real estate and are thinking of getting a divorce – or are already in the midst of one – you might want to consider hiring an interim property manager to handle the finances and day to day management of the property. (Or you could ask the court to appoint someone, in which case both you and your spouse will be asked to provide the names of 2-3 property management companies along with their fee structures.)
Yes, you’ll pay around 10-11% of the rental income to the property manager (some of which might have ended up going to the legal guys anyway), but you’ll rest easier knowing exactly what’s going on with that real estate.
One quick tip… Make sure the property management firm you choose is impartial. This doesn’t necessarily mean that you should choose someone you don’t know, but it definitely does mean you should choose someone who knows that his job is to manage the real estate to the best of his (or her) ability – and not to get involved with taking sides in the divorce.
As I said, divorce stinks. Take a bit of the pain away by letting someone else manage the headaches of the real estate for a while.
Question & Answer on a Real Estate Site:
My fiance and I want to rent an apartment in our town for about $350 a month. Can anyone help?
My amended and de-identified response (and I sure wish I’d been able to offer some hope for this couple):
My husband owns a property management & leasing company (http://www.onthespotrentals.com), and hears this kind of question several times a day. “Where can I get an apartment for under $500?” “I want to rent a 3 bedroom house, utilities included, for $700 a month”, etc. Many people will add that they’re “handy” and can fix the place up in exchange for reduced rent.
The unfortunate reality is that there’s almost nothing out there that’s that cheap (and if it was, you truly would not want to live there). Last year (Fiscal Year 2010), the Fair Market Rent for a one-bedroom apartment in your county was $705 per month. That’s twice what you want to pay, and means it will be almost impossible to find anything in your price range.
I’ve heard tenants complain that the landlords are overcharging, and gouging the tenants with their prices, but mostly that’s not at all true. It’s very expensive to own & maintain an apartment building (I know this from personal experience because I used to own several). Depending on the size of the building and its orignal cost, the mortgage, taxes and insurance can easily be a couple of thousand dollars a month. Then there’s heat, and common electricity, and water/sewer, and maintenance, and snow plowing and lawn care… many buildings lose money on a monthly basis – the landlord is just hoping to make money in the long run.
I do hope someone else has a different answer than I can offer, but I’m afraid you’re going to find it extremely difficult to get an apartment for as little as you’re looking to pay.
Marketing & Development
On the Spot Rentals
A recent post on Trulia asked: “I’m concerned the building where I’m renting an apartment will be up for sale. Is it now? Can I be alerted if gets put on the market?”
One real estate agent out of the southwestern U.S. stated that the tenant would be able to tell because all Realtors will put a lockbox on the apartment building. Another Realtor more correctly responded that a Realtor may or may not put a lockbox on the building.
Here’s our response:
I agree with the last Realtor’s response that the lack of a lockbox doesn’t mean anything. The property could be for sale by owner, or the owner might choose not to have a lockbox on the building. Or it could be in foreclosure, or it could not be for sale at all.
In Maine a property can be searched by the general public by going to http://www.mainelistings.com. You’ll be able to find out if your building is currently for sale by inputting your address. However, this doesn’t necesssarily solve the poster’s question, if the property is for sale by owner, or if it’s in foreclosure.
The law states you must be given 24 hours notice for any kind of inspection, which includes allowing a potential buyer to look at your apartment. Unfortunately, it is entirely possible that a landlord would put a property on the market without telling the tenants until the first buyer showing is scheduled… and that could be when you first find out. It happened to a friend of mine.
I don’t know how many units your building contains but the reality is that the more there are, the less likely a potential buyer will want to see yours on a first showing. (Many multi-unit buyers don’t go through every single unit the first time through; they just want to get a sense of whether the property would be a good investment.) If you’re in a larger building and the tenants don’t talk to each other, it’s possible a potential buyer would go through one of their apartments and not yours.. and you’d never know.
Is there a reason why you’re worrying about this? Has the landlord been having difficulties paying for heat or other bills? Have “insurance companies” been around, taking pictures? Often that’s an indication that something is up… the so-called insurance company is actually an appraiser or Realtor.
If the building does go on the market to sell, your best bet is to make sure you are current with your rent, and that you’re keeping your apartment in excellent shape. A new landlord won’t usually want to lose a good tenant.
If there’s a possible foreclosure in the horizon, you’ll still want to stay current on your rent in order to have good references when it’s time to look for a new place to live.
If you find yourself in a difficult position and need a new rental, please give John “Johnny On the Spot” a call at 207.713.0674.
In the meantime, unless there are some things going on that you haven’t mentioned, it sounds like you’re okay – no sense in worrying about something that may not be an issue at all.
My husband John noticed a bill before the Maine legislature that would be a killer for landlords and tenants alike if it were to pass: Essentially, the responsibility for a pet’s behavior will no longer be just the pet owner’s but also the landlord’s.