Friday, June 16, 2006


Real Estate Taxes

I highly recommend contesting your real estate taxes at least once every few years. It is like fighting a parking ticket, you may not win but what do you have to lose. Most apartment buildings are taxed at a higher rate then residential properties. Here are the things to consider before contesting your taxes. First try to see what similar buildings in the area are paying for their real estate taxes. You can find this information on the cook county assessor's web-site or if you know a real estate agent like me you can contact me with the addresses and I can look them up on the MLS. If your taxes are the same or less than your neighbors there may not be much of an advantage to contesting them, unless you have been doing extensive remodeling or for some reason had a high and long vacancy period. The other thing to check on the assessor's web-site is if your building is describe properly. How many units and baths and square footage etc. I have owned three properties in Chicago and all of the descriptions have been wrong. One time the mistake was in my favor, so I say, let sleeping dogs lie. The other times I let the county know the mistakes they had made.

If you are going to contest you taxes you still have a few choices. You can hire an attorney to do the work for you. They usually tax 50% of what they save you in the first one to two years. You don't have to do any work and the lawyer only gets paid if they reduce your real estate taxes. I have done it myself as well. Mostly it takes time. Going to the county offices downtown and filling out the paper work. Usually you have to come back for a hearing with all of your proof, like the tax bills of similar properties and pictures of your own property. Then you just have to sit back and hope for the best.

The other important things to remember is if you live in the property you can file for the home-owners exemption. You can get this retroactively if you have never applied before and it will reduce your real estate taxes. You have to have lived in the property for the full calendar year to qualify for the exemption. There is also a senior exemption. All this information is at the county building or on the assessors or treasures web-sties.

Good luck and fight those real estate taxes.

Friday, June 02, 2006


Dirty Tenants

You have probably all heard the story about the tenant in Utah that left 70,000 beer cans in the town house he rented. He seemed like the ideal tenant for 8 years, never complained and paid his rent on time. For pictures you can check out under local news.
I really can't understand a landlord not checking in once in 8 years. I have to say I always come up with an excuse or reason to see how my tenants are living. You need to get in there sometime in the first few months and see what living conditions your tenant has. Waiting 8 years means a long and expensive cleaning process. Unfortunately, even if you do get the chance to check things out it may be too late. If your tenant has a lease it is difficult or impossible to evict them because they live like pigs, even if other tenants are complaining. You usually have to wait them out. One way to avoid this is a careful screening process, but some landlords just won't be truthful. Another trick is to get larger security deposits. If your area has a tight rental market I recommend at least a year and half security deposit and don't let tenants apply it to the last month's rent.

Here are some of my own experiences with messy tenants:
One tenant had 4 cats, when she moved I had to tear out all the carpet. It smelled like cat pee and there where fleas too. I was lucky that the cat pee did not damage the wood floors underneath the carpet. Cat pee is very destructive and will discolor wood floors. Unfortunately it may take a few weeks for the damage to appear.
Another tenant, I called him the bird man, had left the carpet covered in chicken bones, feathers, newspaper and change. There was probably $100 dollars worth of change on the floor but no one was brave enough to pick through the other stuff to get to the change. I think they just rolled up the carpet as is and threw it away. I didn't stay to watch that clean up. The most amazing part was that I rented it to a young girl who came to see it with her mother! I promised them new everything and lowered the price a little and they said ok.
I had a couple that lived in filth. They moved out a few weeks early, but I still could not show their apartment it was so dirty. I offered to clean it for free just so I could start showing. At first they said no and we actually had an argument about it, but then they finally acquiesced. There apartment still smelled like smoke for months after.

Good luck and remember careful screening is the best way to avoid messy tenants.

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