Are you a renter in need of some basic information in regards to the rental process? We did our best to help you with some basic questions and answers for you to consider!! The information provided for you here is to help you understand the rental process and to serve as a reference guide for you. Any legal questions you may have regarding real estate contracts or law should be directed to an attorney. Please be aware that I am not responsible for the actions of any other real estate professionals you may come in contact with. If you do not use my services then I hope I was at least able to educate you somewhat so you don’t run into any pitfalls. If at any time you do not fully understand the information below, please call me directly on my cell, toll free, at 1-800-442-8171 for clarification. Good luck!!
1. What is the MLS?
The MLS or Multiple Listing Service is a service that is provided by our local Miami board of realtors (www.miamire.com). This service allows South Florida members to place or access listings in an effort to facilitate real estate sales and rental transactions. MLS listing information, which at one point was only accessible by Realtors, is now available for the general public to view. You may find the following types of properties on the MLS for rent or sale: Single family homes, condominiums, townhouses, commercial, industrial, vacant land and business opportunities. To search the MLS for any of these types of properties, please click on the “Property Purchase” icon and fill out the fields according to what you’re looking for.
2. What is a “public rental”? A public rental is any residential building or community where the individual units are not privately owned by a person or entity and secured by a mortgage. A single person or entity may own the entire building or community thus owning all the units. Normally in your larger buildings and/or rental communities there will be on onsite leasing or management office to handle all rental prospects looking to rent an apartment.
3. What is a “private rental”? – A private rental is any residential building or community where the individual units are privately owned by a person or entity and secured by a mortgage. An example of this would be a condominium building where each unit in the building is privately owned by a single person, family, investor or business.
4. My husband and I like this particular condo in the Coconut Grove area, but when we went to inquire about renting an apartment, they said we would have to go to a real estate office to do so. Why is that?
Normally in your condominiums or residential communities where the units are privately owned, there will be an on site management or association office, but they normally will not be able to help you with renting an apartment. Their primary focus is on the management and security of the community and common areas as well as the collection of monthly dues from the individual owners. It is up to the individual owners to secure a renter for their unit, either by advertising in the newspaper or by listing their unit with a real estate office in order to secure a tenant.
5. I’m relocating from Tampa and found a rental building called Gables Ponce online. What are typical move in costs for renting an apartment in a “public rental” community or building?
All the rental communities or buildings (in Miami) I work with (like Gables Ponce) ask for no more then your first months rent and one month’s security deposit. What I’m finding more often is that the buildings I work with are now offering reduced security deposits to those with good credit. Those with shaky or bad credit may be required to pay an additional deposit prior to move in. All deposits are refundable to the tenant, providing of course they fulfill the term of the lease and leave the vacated unit in good condition. The application process and other costs you may incur are as follows:
Deposit & application fee – You will begin the application process by filling out an application and leaving an application fee as well as a deposit to reserve an apartment. The deposit may range from a couple hundred dollars to a full months rent. The application fee is a fee charged for the pulling of your credit report and can range anywhere from $25 to $100 depending on where you rent at and is non-refundable. During the application process, the leasing office will also verify your rental history, income and employment. If you apply for an apartment and your application is denied because of any reason, you will receive your deposit back in full but not your application fee. If you apply for an apartment and are approved, and then cancel a day before your scheduled move in, then not only will you lose your application fee but you more then likely will lose your deposit as well. Your deposit will be considered liquidated damages due to the rental community for taking a unit off the market exclusively for you. It’s best to ask the leasing consultant at the time of application their policy in regards to canceling your move and the time frame you must do so in order to get your deposit back.
Re-Decoration Fee – Typical in most rental communities. Range from $100 – $250 depending on where you rent. This fee goes to the cleaning, painting and re-vamping of your apartment when you move out. You don’t need to clean or paint before you vacate, nor do you need to patch any nail holes where you had pictures hanging…just simply move out. Please be aware that this fee applies to getting your old apartment ready for the next person and does not apply to any serious damage you may have done to the unit. Any serious damage done to the unit may affect how much of your security deposit you will get back after you do move out. Please be aware that if you paint the walls of your apartment a different color then what they originally were, you may be required to paint them back to the original color prior to moving out. Please consult with the leasing agent in regards to this issue if you plan on painting the walls other then white.
Pet Fees and Pet Deposits – Very important to understand the two because pet fees are non refundable whereas pet deposits are. Pet fees and deposits range all over and I have the exact fees and deposits indicated in the property information section of each of my “public rental” properties. Normally, if the charge for a pet is a “pet deposit”, you most likely won’t get all of it back when you vacate the unit. In essence, the “pet deposit”, is also a “pet fee” at the end because you will only get a portion of your pet deposit back. Ex: Mrs. Smith, we do allow pets here, there will be a $500 pet deposit out of which $250 is refundable.
Administrative Fees – Some of the “public rental” buildings I work with charge an administrative fee which may range from $75 to $200. I don’t know what this fee is based on and have never asked. I can only assume it’s an additional charge for the processing of your application.
6. My sister and I found a cute two bedroom for rent in Coral Gables. The leasing agent told us after showing us around the property that they were offering a “move-in special”. Please explain this!!
Move in specials are common in your “public rental” buildings and communities. Essentially, it’s an incentive offered to you for you giving them your business and works best if you have good credit. Move-in specials come in several forms (free months rent, reduced security deposit), and may be applied in different ways. For example, the building offering you your first month free will either give it to you up front, or allow you to pro-rate it throughout the term of your lease. If you’re finding it hard to come up with money to move, then taking the free month up front would be a good choice. That way you only have to come up with your security deposit and application fee to move in. If coming up with money is not a problem, but the market rent on the apartment is say $75 more then you wanted to spend, then having the free month pro-rated over the term of the lease would be your choice as this would reduce the market rate of your unit (see below). This is very helpful if you’re trying to stay within a certain price range. The building you wouldn’t normally apply to because you would be $75 over your budget is now affordable to you because of the move-in special. If the free month is given to you up front, you then have to do some math to realize what your average rent per month comes out to. Example: Building “A” has a one bedroom for $1100 and is offering one-month free ($1100 value) if you apply within the next 5 days. You can take your first month for free, or have it pro-rated over the term of your lease. Your rental budget is no more then $1025 and you want a one year lease. If you take the free month up front then you’re paying for 11 and staying for 12. When you factor in the free month you realize your average monthly rent drops from $1100 to $1008.34. How’s that?
$1100(market rate) divided by 12(lease term) = $91.66
$1100 – $91.66 = $1008.34 (average rent per month)
If your budget conscious, and the market rent of $1100 is $75 more then what you wanted to pay for rent, then it would be to your benefit to have the free month pro-rated over the term of your lease. By doing this you will realize the following:
$1100(market rent) divided by 12 (lease term) = $91.66
$1100 – $91.66 = $1008.34 (actual monthly rent for all twelve months)
You are now within your budget because of the free months rent.
7. My wife and I are looking to rent a condo or “private rental” in Brickell. How much should we anticipate paying to get in?
All private rentals off the MLS (Multiple Listing Service) normally require first, last and security to move in. If the monthly rental amount is $800, then the total move in would be $2,400.00, not including any application fees or other deposits (Ex: pet deposit) that may apply. Because at times it may be difficult for creditworthy tenants to come up with 3 months in advance, the move in costs may be negotiated. This is ultimately up to the owner of the unit to do so. Don’t get mad at the agent showing you the property because the move in money is too high. It’s the owner of the unit who sets the total cost to move in, not the agent. The agent on your behalf may negotiate the move in costs for you, just ask. Normally, it’s been my experience that the owner will negotiate the move in price not by reducing the total amount, but by allowing you to pay the last months rent in two or three installments. Very rarely will they simply reduce the total move in costs. Other fees associated with private rentals are as follows:
Application fee – Normally two kinds, one application fee to the condo association when you apply to them, plus a credit report fee if the owner requires a credit report on you. The application fee for the condo association normally runs about $100. This is for processing your application and for any charges they will incur if they choose to do a background check on you (most do). Credit report fees will normally run you $35.
Condominium Common Area Deposit – Becoming more common with condominium buildings. Essentially, it’s a deposit required by the association from either the tenant or unit owner (they don’t care who pays it) to protect against any damage the renter (or renters guests) may cause to the common areas of the community while living there. Normally the unit owner ends up paying this as you can imagine how difficult it would be for them to secure a tenant if the tenant had to come up with the equivalent of 4 months rent to move in.
8. What is involved in the application process for anything “privately owned”?
The application process begins with your realtor submitting what’s called a Contract to Lease or Memorandum to Lease. It’s basically a two-page offer sheet to the owner of the unit describing the price, terms and conditions of the lease. You will also at this time leave a good faith deposit with your realtor showing good faith on your part. Once the owner accepts your offer and signs off on the Contract to Lease, it is now binding on all parties once conveyed back to the realtor who submitted it. It is important to understand that once the offer is accepted and delivered back to your realtor, the deposit that you left as good faith will be forfeited should you decide not to proceed with the deal. This is treated as liquidated damages to the owner for taking his unit off the market exclusively for you. Because it’s the owner who determines what happens with your deposit, it’s quite possible he or she may give all of it back to you or a portion thereof considering any circumstances you may provide. Once you have a signed Contract to Lease, the next part of the application process is to apply to the condominium association for approval. Your realtor should pick up an application for you from the association office for you to fill out. You will submit your application along with the application fee (normally $100, as mentioned above). Once approved, the association office will schedule a screening date for you to come in. The screening appointment may be utilized for different reasons. One may be for you to come in and meet with a few members of the board so that they can meet you and discuss with you the rules and regulations. Other times you may be required to just go to the association office to pick up the rules and regulations and/or sign any paperwork needed for their files.
9. My husband and I came to terms with the owner of a condominium in Coconut Grove. We left a good faith deposit with our realtor and submitted our application to the condo association. What happens if we are not approved?
Well, the Contract to Lease typically used by most realtors here in South Florida has a clause in there that states that the Contract to Lease, and the actual lease itself, is contingent upon approval by the association. If you do not get approved, you’re entitled to all of your good faith deposit back in full. The only money that you will not get back is the application fee to the association and/or any credit report fee you may have given your realtor for the pulling of your credit required by the owner.
10. My girlfriend and I just rented a house in Coral Gables. How much of a deposit do I need to leave initially when trying to rent a home or anything “privately owned”?
The most your realtor should require you to leave as a good faith deposit is a full months rent. Any more then this will be putting you in a bad position. I use to collect a full months rent from the customer, but noticed that they were sometimes hesitant putting down so much money so early. I now ask for half a month’s rent as an initial deposit with the balance of one month due upon acceptance of the Contract to Lease from the owner. My job as your realtor is to protect you assets (your money), the less of it I have initially, the better it is for you in case you are not allowed to proceed with the transaction and have to forfeit your deposit. Be weary of the realtor who asks for all three months up front, as they are putting you in a bad position. Sometimes in life circumstances evolve and it’s quite possible your plans may change. I always remember the time I was helping a college student move here from Virginia. She left a good faith deposit on a condo that was renting for $750 per month. A week prior to her move in her father passed and she decided it was best to stay home with her mother. Can you imaging how much worse she would have felt had I taken three months in advance from her?? Not only would she have had to deal with the loss of her father, the sting of losing $2250 would have made matters even worse. As your realtor I will protect your money and interest.
11. What happens to my “good faith deposit” once I give it to my realtor?
The realtor should immediately turn over all deposit monies to accounting so that it may be deposited into the office escrow account. All deposit monies shall remain in the escrow account until your time of move in where at that point an escrow disbursement will take place. During the escrow disbursement, a check will be drawn to the owner of the property minus any commissions due to the brokerage firms. Please make sure your realtor provides you with a receipt of the money as well. Florida law requires all brokerage firms who maintain escrow accounts to deposit escrow money within three business days of receipt.
12. My roommate and I visited the leasing offices of several rental communities in Coral Gables over the weekend and they all asked to hold on to our driver’s license before touring the property. We felt like they didn’t trust us or something.
The reason they ask you for identification is for security…it’s nothing personal. In accordance with fair housing laws they have to ask everyone else as well, so you’re not alone.
13. Me and my mom rented an apartment home in a very nice rental building. The first week we were there our sink started leaking. Who do we call?
All of the rental buildings and communities I know of and work with have an onsite maintenance staff. During your initial visit or prior to your move in, the leasing consultant should explain to you the procedure for getting things fixed in your apartment. You can either call or visit the office and they should arrange to have one of their workman visit your apartment. You may want to check with the leasing office as to when, and in what time frame problems will be fixed. Some offer 24-hour maintenance, but only for emergencies.
14. In the middle of summer, the central a/c unit in this condo I was renting in Brickell made a funny noise and then never turned on again. Who do I call? Do I have to pay for this?
Typically, the owner of the unit is responsible for making any repairs necessary. Your realtor should explain “who” is responsible and for “what”, should any problems arise. Most leases provide that the owner of the unit will be responsible for any major maintenance over $75. It sounds as though your problem may be a major one, one in which the owner will have to pay for.
15. You advertise as being a free service, how do you make money?
Well, unlike some states where the tenant is responsible for paying the broker fee, our commission or “success fee” as I like to call it, is paid to us by the rental community or by the owner if the unit is privately owned. All rentals that are privately owned and taken from the MLS normally offer a commission of 10% of the gross annual rent. On a $500 rental, the gross annual rent will be $6000. 10% of $6000 = a $600 commission. If two offices are handling the transaction then this commission will be split between both offices. Most rental buildings/communities pay a flat fee.
16. What is the time frame for moving into a rental building (public) vs. a condominium (private)?
Normally, the application/approval process for a rental building or community takes between 24 to 48 hours, providing of course you give them all the info they are asking for. After you’re approved, you can move in immediately by paying your balance and signing your lease. This of course is contingent upon weather or not they have something immediately for you to move into…..the point is that it can be a very quick process. For condominiums, the application process may take anywhere from 3 days to three weeks. This is primarily due to the screening process most condominiums do before letting you move in. It’s important for you to find out from your realtor, the length of time required for approving applications for the condo you’re interested in. Be weary of the realtor who says they can “get your application pushed through in a week”, especially if you have to be out of your old apartment in 10 days. I can assure you that all condominiums have there own policies and procedures as well as time frames in which it will take for you to move in. Find out before leaving a “good faith deposit”. Although single family homes are considered “private rentals”, the time frame in which you can move in is the same as a “public rental” building or community…..very quickly.
17. You have a lot of info on public rental properties and condominiums
…..what about houses or duplexes?
Out of all the information I have given you on “private rentals” and “public rentals”, a little bit of both applies to houses & duplexes, All are considered privately owned and require you to submit the same paperwork (contract to lease) as if renting a condominium. You will also have to put up first, last and security to move in. On the other hand, the time frame in which you can move in is the same as in a “public rental” building or community because there is no application process with an association you have to go through.
18. What is a “mom and pop” building?
A “mom and pop” building is a public rental building that is privately owned by a person, family or entity. A “mom and pop” building usually has an onsite manager who lives in one of the apartments and does general management duties such as collecting rents and making repairs. “Mom and pop” buildings typically are limited to their amenities such as maybe a pool and onsite washers and dryers. The term “mom and pop” is something that I have created to describe these types of properties in my industry. Characteristics of a “mom and pop” building are as follows: More then four units, one to four stories, garden style buildings, may have only stairs and no elevator (or both), few amenities, manager lives onsite and performs small tasks around building.
This material is copyrighted and owned by Joe Higgins, Broker and Grove Town Properties. Any unauthorized use of said material without owners consent is a violation of applicable laws.
Above Image is courtesy of Stuart Miles/FreeDigitalPhotos.net”.