RENT Magazine discusses the latest investing, legal, screening, and tech trends in the rental industry. Contributors include attorneys, tax experts, investors, and real estate influencers. Stay in the know and read RENT Magazine for FREE.
SUMMER 2026
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THE OFFICIAL PUBLICATION OF THE AMERICAN APARTMENT OWNERS ASSOCIATION
AAOA.COM
TEAM VP Robbie Cronrod Editor in Chief Alexandra Alvarado Contributing Editors Allen Artcliff-Cronrod Nancy Abrams Contributors Adrian Smude Allen Artcliff-Cronrod Bradley Barth, Esq. Brian Tulibaski David Holland Dwight Kay Gary Gregory Gita Faust Jason Kogok Jason Malabute Jesse Bailey Joshua Christensen Kate Kruk Leslie Tucker, Esq. Lisa Cozzi Matt Picheny Nancy Abrams Nathan Resnick Richard D. Gann, JD Rick Albert Shiral Torres
CONTENTS
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5 TIPS FOR A DRAMA-FREE TENANT MOVE-OUT
CAN STATES FORCE LANDLORDS TO ACCEPT SECTION 8? NEW COURT RULING
A LANDLORD’S GUIDE TO CO-SIGNERS
HAVE YOU BEEN KEEPING RENT TOO LOW FOR TOO LONG? HOW TO CATCH UP
AI RENTAL FRAUD AND NEW ASSET PROTECTION RISKS FOR LANDLORDS
PRESIDENTIAL LANDLORDS: THE U.S. PRESIDENTS WHO DABBLED IN REAL ESTATE BEFORE YOU HIRE A PROPERTY MANAGER: 12 QUESTIONS EVERY LANDLORD SHOULD ASK
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Welcome to RENT! In this issue of RENT, we look at the realities landlords are facing today, from changing rental laws and rising costs to new risks in tenant screening, fraud, and tax planning. On the legal and compliance side, we cover Section 8, criminal records in tenant screening, co-signers, tenant move-outs, and the questions to ask before hiring a property manager. As laws and renter expectations continue to shift, staying informed can help you avoid costly mistakes. We also explore the financial side of owning rental property, including how to catch up if you’ve kept rent too low, why positive cash flow may not always feel like profit, and how cost segregation and 1031 exchanges may help improve returns. Plus, with the federal EV tax credit now ended, multifamily owners will find guidance on what to consider next. This issue also looks at how renting has changed over the last 20 years, how to fill vacancies faster, and why AI rental fraud is creating new concerns for landlords. For something lighter, enjoy our feature on U.S. presidents who dabbled in real estate, Rental Radar’s visit to Philadelphia, PA, and Celebrities on the Move. Happy reading!
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YOUR PROPERTY SHOWS POSITIVE CASH FLOW. SO WHY DOES IT FEEL LIKE YOU’RE LOSING? 12 WAYS RENTING HAS CHANGED IN THE LAST 20 YEARS CRIMINAL RECORDS IN TENANT SCREENING: WHAT YOU CAN AND CAN’T USE THE FEDERAL EV TAX CREDIT IS GONE: HERE’S WHAT MULTIFAMILY PROPERTY OWNERS SHOULD DO NEXT
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THE RENTAL RADAR: PHILADELPHIA, PA
THE 1099 MISTAKE LANDLORDS MAKE WITH CONTRACTORS AND VENDORS THE 1031 INVESTOR TRAP: HOW 1% ANNUAL RIA FEES CAN UNDERCUT YOUR RETURNS
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CELEBRITIES ON THE MOVE
HOW TO FILL A VACANCY FASTER WITHOUT LOWERING YOUR STANDARDS COST SEGREGATION FOR APARTMENTS: HOW TO BOOST CASH FLOW WITH TAX SAVINGS
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Disclaimer: All content provided here-in is subject to AAOA’s Terms of Use . Nothing contained on this website constitutes tax, legal, insurance or investment advice, nor does it constitute a solicitation or an offer to buy or sell any security or other financial instrument. AAOA recommends you consult with a financial advisor, tax specialist, attorney or other specialist who is able to properly advise you.
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5 TIPS FOR A DRAMA-FREE TENANT MOVE-OUT
Ask any property manager where the highest concentration of operational drama lives, and they will likely point to a single square on the calendar: Move-Out Day. It’s the moment when hidden damages are exposed, security deposit disputes ignite, and online review scores go to die. Many operators treat move-out drama as an unavoidable cost of doing business—a “resident relations tax” they simply must pay. But high-performing operators know that sustainable excellence is never accidental; it is a process blueprint. Move-out drama isn’t a problem with people; it’s a process problem. To eliminate the friction and protect your asset’s Net Operating Income (NOI), you must stop firefighting the chaos and start blueprinting the transition. True operational freedom starts when you realize that a smooth move-out doesn’t begin on the day the keys are handed back. It starts well before the tenant even packs a box. Here are 5 tips to engineer a disciplined, drama-free tenant move-out.
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ESTABLISH COMMUNICATION TRANSPARENCY EARLY
Drama thrives in the dark spaces where expectations are left unsaid. If the first time your tenant hears from you regarding their move-out is an automated form letter sent five days before lease-end, you have already dropped the ball. Establish a “Messaging Cascade” at least 45 to 60 days prior to departure. Send a clear, localized guide outlining exactly what is expected of them. Don’t speak in dense legal terms or corporate jargon. Spell out cleaning expectations, key return logistics, and utility transfer requirements in simple terms. When you remove the ambiguity, you remove the anxiety that fuels defensive behavior.
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CONDUCT A PRE-MOVE-OUT INSPECTION WALK WITH THE TENANT
Never wait until the tenant has vanished to assess the state of the property. Schedule a preliminary walkthrough two weeks before the official move-out date and make it mandatory that the tenant walks the apartment home with you. Think of this as a diagnostic audit. It gives you the visibility to point out potential charges, such as wall scuffs, missing blinds, or deep cleaning needs while the tenant still has the time to correct them. By identifying the hurdles early, you give the tenant a sense of control and eliminate the element of surprise that causes security deposit sticker shock later.
MAKE IT MANDATORY THAT THE TENANT WALKS THE APARTMENT HOME WITH YOU.
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COMPLETE THE FINAL MOVE-OUT INSPECTION TOGETHER
The final inspection should never feel like a secret trial. Whenever possible, perform the official move-out inspection side-by-side with the outgoing residents. Using a digital inspection tool and/or the initial “move-in inspection form” from the resident, document the condition of every room in real- time. Take photos of pristine areas as well as damaged ones. Walking the property together creates an environment of mutual accountability. When a tenant sees a hole in the drywall right next to you, it stops being an adversarial argument and becomes an objective fact. You aren’t “taking their money;” you are simply documenting the assets’ reality.
WALKING THE PROPERTY TOGETHER CREATES AN ENVIRONMENT OF MUTUAL ACCOUNTABILITY.
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PROVIDE TRANSPARENT PRICING FOR DAMAGES AND REPAIRS
One of the fastest ways to trigger an angry phone call or a negative Google review is to hand a former resident a vague, lumped- together bill for “repairs.” If your statement of deposit accounting just says “$600 – Maintenance” , prepare for battle. Combat this friction with absolute pricing transparency. Maintain a standard, pre-itemized cost sheet for common repairs, such as a fixed price per burnt-out light bulb, a standardized fee for patch-and-paint per room, or a set cost for carpet cleaning. When your pricing is fixed and transparent, residents realize that damage costs reflect their choices, not an arbitrary penalty invented by management.
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DELIVER A TIMELY STATEMENT OF DEPOSIT ACCOUNTING REPORT 5
The final pillar of a drama free move- out is speed and compliance. Delays in processing security deposits aren’t just an administrative headache; they are a legal liability and a major source of corporate noise. Audit your internal accounting workflows to ensure that the final Statement of Deposit Accounting (SODA) report is generated, finalized, and mailed (or emailed as applicable) well within your state’s statutory deadlines. When you return what is rightfully theirs swiftly or back up your deductions with a clear, itemized blueprint of photos and receipts, you close the loop cleanly.
THE FINAL PILLAR OF A DRAMA FREE MOVE-OUT IS SPEED AND COMPLIANCE.
THE “NOT NORMAL” TAKEAWAY A promotion, a scalable portfolio, and a thriving community are built on repeatable systems, not lucky breaks. Every move-out is an operational handoff. By auditing the friction in your turn process and mapping a disciplined framework of transparency, you don’t just save your team from burnout, you blueprint your community’s excellence. Stop managing the move-out noise. Architect the flow.
GARY GREGORY Author, Speaker, and Founder Multifamily Strategic Enterprise Blueprint multifamilySEB.com
Gary Gregory is an author, professional speaker, and the founder of the Multifamily Strategic Enterprise Blueprint (MF SEB), a consulting framework dedicated to helping real estate leaders audit operational friction and map disciplined workflows for scalable growth.
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CAN STATES FORCE LANDLORDS TO ACCEPT SECTION 8? NEW COURT RULING Across the country, more states and local governments have been moving toward laws that prevent landlords from having blanket “no Section 8” housing policies. But a New York appellate ruling has brought a new question to the surface: When a state requires a landlord to accept Section 8 vouchers, does that also require the landlord to accept the inspections, access to records, and contract obligations that come with the federal Housing Choice Voucher program? This question sits at the center of a New York case involving source-of-income discrimination, Section 8 housing assistance, and the Fourth Amendment. The court does not conclude that the Section 8 program itself is unconstitutional or eliminate all source-of-income protections. But it does create a serious compliance question for New York and a warning signal for other places with similar laws.
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THE CONCERN WAS NOT THE VOUCHER PAYMENT ITSELF BUT THE PROGRAM OBLIGATIONS ATTACHED TO IT.
THE BACKGROUND: THIS WAS ABOUT MORE THAN RENT PAYMENT
New York’s Human Rights Law protects against discrimination on the basis of lawful source of income in housing, including wages, public assistance, Social Security, child support, alimony, foster care subsidies, and housing assistance such as Section 8 vouchers. This means that housing providers could not simply say “no Section 8,” refuse voucher applicants, delay applications because of a voucher, or treat voucher holders differently because of how rent would be paid. The case began after two prospective tenants alleged that Ithaca landlords refused to rent to them because they used Section 8 voucher
assistance. The New York Attorney General brought an enforcement action, arguing that the landlords violated New York’s source-of-income discrimination law. The landlords challenged the law, arguing that mandatory voucher acceptance effectively forced them into the federal Housing Choice Voucher program, which involves mandatory inspections, rent reasonableness reviews, access to records, and a Housing Assistance Payments contract. The landlords were asking the court to view Section 8 as more than just another way rent is paid, but rather on what accepting a voucher requires after approval. to accept those obligations as part of source-of- income compliance raised Fourth Amendment concerns. The ruling was narrow. It did not strike down the Section 8 program altogether or eliminate all source-of-income protections. It focused specifically on mandatory Section 8 acceptance and the government access and contract requirements that come with the Housing Choice Voucher program.
WHAT THE COURT RULED
The court recognized New York’s housing affordability concerns and the role Section 8 plays in expanding access to housing. However, it held that New York’s source-of-income law was unconstitutional to the extent that it required landlords to accept Section 8 vouchers. The concern was not the voucher payment itself but the program obligations attached to it, including inspections, access to records, and the HAP contract. In the court’s view, requiring landlords
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THE ISSUE BEHIND THIS RULING IS NOT LIMITED TO NEW YORK.
WHAT THIS MEANS FOR NEW YORK HOUSING PROVIDERS
For New York housing providers, the ruling creates a serious compliance issue, but it should not be treated as permission to ignore source-of-income protections. After the Appellate Division ruling, the case moved to the New York Court of Appeals, the state’s highest court. That means the Appellate Division decision may not be the final word. New York law also provides for a stay of enforcement in certain appeals involving the state or a state officer or agency.
In practical terms, housing providers should not assume they can now refuse Section 8 applicants based on this ruling alone. The New York Attorney General continues to describe lawful source-of- income discrimination as illegal, identify Section 8 vouchers as protected, and accept source-of- income discrimination complaints. The safer takeaway is this: New York housing providers should continue treating source-of- income compliance as active and should not make voucher-related policy changes without legal guidance.
WHY OTHER STATES SHOULD PAY ATTENTION
The issue behind this ruling is not limited to New York. Many states and local governments have source-of-income protections, and some specifically prohibit discrimination against Housing Choice Voucher holders. In some of those jurisdictions, there have been similar challenges based on the same arguments as those made in this case. The ruling in this New York case does not mean that other jurisdictions’ source of income laws are automatically unconstitutional. Different states may
have different statutes, procedures, ordinances, or constitutional standards. But the New York ruling will certainly become part of the conversation in places where voucher acceptance is mandatory. The key question for other states is this: Does the law require voucher acceptance in a way that effectively requires housing providers to participate in the Housing Choice Voucher program and accept inspections, records access, and contract terms that may raise constitutional concerns?
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HOUSING PROFESSIONALS SHOULD USE THE WATCH METHOD When a ruling like this comes out, it is easy to either overreact or dismiss it as someone else’s problem. The better approach is to stay alert, understand your local requirements, and avoid making rushed policy changes. The WATCH method gives housing professionals a simple way to remember the next steps:
WATCH THE ISSUE WITHOUT JUMPING THE GUN.
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This case is now before New York’s highest court, so housing providers should not treat the Appellate Division ruling as final permission to change voucher policies.
ASSESS YOUR STATE AND LOCAL REQUIREMENTS.
A
Source-of-income protections often exist at the state, county, or city level, and the rules can vary widely.
TRACK AGENCY AND COURT UPDATES.
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In New York, watch the Court of Appeals, state agencies, local governments, public housing agencies, and local human rights commissions.
CONSULT LEGAL COUNSEL BEFORE CHANGING VOUCHER POLICIES.
C
A blanket voucher-refusal policy may still pose a risk, depending on the jurisdiction, advertising rules, and enforcement guidance.
HANDLE APPLICANTS CONSISTENTLY AND CAREFULLY.
H
Avoid rushed decisions, inconsistent treatment, or statements that could create a separate fair housing risk.
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THE BOTTOM LINE New York’s ruling does not end source-of-income protections or invalidate the Section 8 program. But it does raise a serious constitutional question about mandatory voucher acceptance. For New York, the immediate issue is the tension between source-of-income protections and Fourth Amendment concerns. For other states, the ruling is not a command. It is a caution sign.
LESLIE TUCKER, ESQ. Principal Partner Williams Edelstein, Tucker, P.C.
Leslie is the Principal Partner of Williams Edelstein, Tucker, P.C., a fair housing defense law firm, and serves as the Assistant Vice President at the Fair Housing Institute. With a career dedicated to defending housing providers across the country, Leslie offers over a decade of expertise in fair housing matters. Leslie represents her clients in administrative fair housing cases, assists with drafting and updating company policies, consults on day-to-day fair housing-related decisions, and provides live training sessions on fair housing laws, federal housing programs, and landlord-tenant issues. Additionally, she is an expert in physical accessibility standards for multifamily housing, encompassing both local building codes and federal requirements like the Americans with Disabilities Act (ADA) and the Fair Housing Act (FHAAG). Leslie has been actively involved in consulting and training with the Fair Housing Institute since 2021.
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A LANDLORD’S GUIDE TO CO-SIGNERS You have a vacancy to fill and a rental application from a prospective tenant who seems like a great fit. After reviewing their background screening and credit report, however, you discover a potential concern. Maybe they have a limited credit history, a few past credit issues, or insufficient income to give you complete confidence. Situations like these are common, and they do not always mean the applicant should be denied. In many cases, requiring a qualified co-signer or guarantor can help reduce your risk while giving an otherwise acceptable applicant the opportunity to rent your property, but it is important to handle the process carefully.
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IF YOU WOULD NOT RENT TO THE CO- SIGNER BASED ON THEIR FINANCIAL PROFILE, THEY MAY NOT BE THE RIGHT PERSON TO GUARANTEE SOMEONE ELSE’S LEASE.
CO-SIGNER VS. GUARANTOR: WHAT’S THE DIFFERENCE?
When an applicant lacks strong credit or sufficient income, they may ask a parent, relative, friend, or other financial supporter to help secure the lease. Depending on the arrangement, that individual may serve as either a co-signer or a guarantor.
A co-signer signs the lease alongside the tenant and shares responsibility for fulfilling the lease terms from the start. In some cases, a co-signer may also occupy the property, although this depends on the lease agreement and local regulations. If rent goes unpaid or other lease obligations are not met, the co-signer is equally responsible.
A guarantor serves a different role. A guarantor usually does not live in the rental unit and is not considered a tenant. Instead, they sign a separate agreement promising to step in financially if the tenant fails to pay rent, causes significant property damage, or otherwise defaults on lease obligations.
The key distinction is usually timing and scope of responsibility. A co-signer generally shares responsibility from day one, while a guarantor’s obligation typically begins only after the tenant fails to meet their responsibilities. Because the exact obligations depend on the wording of the lease, guaranty, or co-signer agreement, landlords should use clear written documents and follow applicable state and local law.
WHY SCREENING THE CO-SIGNER MATTERS
Many landlords make the mistake of focusing primarily on the tenant while giving only a cursory review to the co-signer or guarantor. That can be a costly oversight. If the tenant falls behind on rent, the co-signer or guarantor becomes your financial backup plan. Their ability and willingness to fulfill that commitment is every bit as important as the tenant's qualifications. Think of it this way: if you would not rent to the co-signer based on their financial profile, they may not be the right person to guarantee someone else's lease. A thorough screening process should begin with a completed rental application and written authorization to conduct background and credit checks. Once the reports are available, review them with the same level of scrutiny you would apply to any rental applicant.
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Income verification is especially important. A co-signer may have an excellent credit score but already be carrying substantial financial obligations. Ideally, they should have sufficient income and assets to comfortably cover both their own expenses and the tenant's rent, if necessary. It can also be helpful to evaluate the relationship between the applicant and the co-signer. Parents commonly co- sign for college students and young professionals entering the rental market. In other situations, a friend or distant relative may volunteer to help. While the relationship alone should never determine your decision, it may provide insight into how committed the co-signer is likely to be if problems arise.
Pay particular attention to a co-signer’s:
Credit score and overall credit history
Debt-to-income ratio
Current employment and income stability
History of late payments or collections
Bankruptcies, judgments, or tax liens
Prior evictions or landlord disputes
Criminal background, where permitted by law
Before requesting a co-signer, landlords should establish clear written criteria for when one will be required. For example, a policy may state that a co-signer is needed when an applicant does not meet the property’s minimum income, credit, or rental history standards. Applying the same criteria consistently helps landlords avoid subjective decisions and reduces the risk of fair housing complaints. Landlords should also remember that Fair Housing laws apply throughout the screening process. Co- signers and guarantors must be evaluated using consistent criteria and cannot be treated differently based on protected characteristics such as race, color, religion, national origin, sex, familial status, or disability. When the screening process is complete, document your findings and maintain the same qualification standards you use for all applicants. Consistency helps reduce risk and supports fair, defensible leasing decisions.
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THE AGREEMENT SHOULD CLEARLY DEFINE THE SCOPE OF RESPONSIBILITY.
COMPLETING THE PAPERWORK
WHEN NO CO-SIGNER IS AVAILABLE Not every applicant has someone willing or able to co-sign a lease. In these situations, LeaseGuarantee may provide an alternative solution. Once you approve a co-signer or guarantor, make sure the proper legal documents are executed before move-in. The lease and any applicable guaranty agreements should clearly outline the individual's financial obligations and the circumstances under which they may be held responsible. The agreement should clearly define the scope of responsibility. For example, it should state whether Available to AAOA members, LeaseGuarantee offers protection for all individuals named on the lease for a 12-month period, with renewal options available. Coverage amounts range from $1,000 to $10,000, allowing landlords to select a level of protection that matches their risk tolerance.
the co-signer or guarantor is responsible only for unpaid rent or also for late fees, property damage, utilities, legal fees, renewal periods, or other lease-related charges. It should also explain when the obligation begins, when it ends, and how the landlord will provide notice if the tenant defaults. Well-drafted documentation can make enforcement significantly easier if problems occur later. When an applicant’s credit report is processed, the LeaseGuarantee Analyzer evaluates eligibility and pricing based on the applicant’s credit profile and other qualifying factors. If approved, protection can be purchased by either the landlord or the tenant within 10 days of the credit screening. Some landlords also accept LeaseGuarantee as an alternative or supplement to a traditional security deposit, creating additional flexibility during the leasing process.
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A STRONG CO-SIGNER CAN PROVIDE MEANINGFUL PROTECTION AND GREATER PEACE OF MIND. A WEAK ONE MAY OFFER LITTLE MORE THAN A SIGNATURE ON PAPER.
AN EXTRA LAYER OF PROTECTION Requesting a co-signer or guarantor is not about making the rental process more difficult. It is about reducing risk while opening the door for qualified applicants who may not yet meet your standard screening criteria on their own. The key is making sure the person backing the lease is thoroughly vetted. A strong co-signer can
provide meaningful protection and greater peace of mind. A weak one may offer little more than a signature on paper. By conducting comprehensive screening and using the right risk-management tools, landlords can make more informed leasing decisions and protect their rental income over the long term.
NANCY ABRAMS Assistant Editor American Apartment Owners Association (866) 579-2262 nancy@aaoa.com
Nancy Abrams has enjoyed a long career in real estate marketing throughout Southern California and Las Vegas. She formerly represented 19 Merrill Lynch Realty branch offices, property managers The Roberts Companies, new home developers, including master planned communities Peccole Ranch and The Valencia Company and shopping centers for Sandy Sigel of NewMark Merrill.
Disclaimer: All content provided here-in is subject to AAOA’s Terms of Use. Nothing contained on this website constitutes tax, legal, insurance or investment advice, nor does it constitute a solicitation or an offer to buy or sell any security or other financial instrument. AAOA recommends you consult with a financial advisor, tax specialist, attorney or other specialist who is able to properly advise you.
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HAVE YOU BEEN KEEPING RENT TOO LOW FOR TOO LONG? HOW TO CATCH UP In a tight market, pushing rents to the top makes sense. In this one, it can hand you a vacancy you didn’t need. Vacancy is elevated nationwide, but the picture varies sharply by market. Some owners, especially in submarkets facing new supply and aggressive lease-up competition, have had to work harder to keep occupancy and effective rents steady. Concessions that disappeared during the 2021–2022 boom, such as free months, waived deposits, and reduced first-month rent, are back in many submarkets. If you’ve frozen rents to hold onto tenants, so did many other owners. But if you’ve been sitting on the same rent for two or three years and haven’t had the conversation yet, you’re leaving money on the table, and the gap compounds every cycle you wait.
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THE CLASS B AND C LANDSCAPE
Here's something the broader market data tends to obscure. The vacancy pressure hitting small landlords right now is not evenly distributed. Some indicators suggest small Class B and C properties can feel more vacancy pressure in this cycle, especially where Class A lease-ups are using concessions to pull renters up-market. The good news: according to Arbor Realty Trust and Chandan Economics, the small multifamily sector entered 2026 on steady footing, with the long-term outlook remaining decisively positive, and occupancy is beginning to recover.
THE CASE AGAINST SWINGING FOR FULL MARKET
Here’s where a lot of landlords overcorrect. Having frozen rents for too long, they decide to reset everything at the next renewal at full market rate, all at once. In a tight market that might work. In this market, it’s a gamble. If your building is in a submarket where rents have recently dropped and you push hard at renewal, your tenant can find concession-heavy competition nearby. You may win the rent increase and lose the tenant. And then you’re doing the math: one month of vacancy, turnover cleaning, touch-up repairs, and re-leasing costs. In most scenarios, that’s $3,000 to $5,000 out the door, which easily exceeds whatever you gained. The better play is deliberate and incremental. Move rents up in steps over two or three renewal cycles, and land intentionally just below market, not at it. That gap is not a failure to maximize income. It’s a retention tool. A good tenant who knows they’re getting a fair deal is worth more than full market rent on a vacant unit.
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THE MATH ON DOING NOTHING If you have a tenant paying $1,500 per month and the market is at $1,750, that’s $3,000 per year in unrealized income per unit. On a 10-unit building, even if only half the units are below market by that margin, you’re looking at $15,000 annually that isn’t showing up on your rent roll or in your NOI. And it doesn’t stay static. Every year you don’t change rent, the gap gets wider and harder to close without risking a tenant who’s been there long enough to have real options.
HOW TO ACTUALLY DO IT
1. Know your effective rent Pull active listings on Zillow and Apartments.com for your submarket and unit size. But don't just look at asking rents. Many buildings are advertising concessions. One month free on a 12-month lease is effectively an 8% discount on the asking price. Strip those out and figure out what tenants are actually paying net.
ONE MONTH FREE ON A 12-MONTH LEASE IS EFFECTIVELY AN 8% DISCOUNT ON THE ASKING PRICE.
2. Move in increments If you're $200 below market, a $100 increase at first renewal and $75 to $100 at the next gets you close without triggering a search. Frame it professionally. You don't owe an explanation, but one helps. Across the country, landlords are facing higher insurance premiums, property taxes, repairs, labor, and maintenance costs. Florida is one of the clearest examples: landlord insurance averaged roughly $5,376 per year for $300,000 in coverage in 2025, more than double the national average. Costs are rising everywhere, and tenants understand that pressure because they are feeling it too.
3. Target just under market, not at it In a soft market with elevated vacancy, pricing $50 to $75 below a comparable vacant unit nearby is a feature of your strategy, not a flaw. You're buying retention with a small discount. The math almost always works in your favor.
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THE BOTTOM LINE With homeownership out of reach for many households, more tenants are staying in the rental market longer than in previous cycles — an opportunity for small multifamily investors willing to focus on tenant retention, according to Dr. Sam Chandan. That tailwind is real. But it only helps you if your rents are moving in the right direction. Don't stay frozen. Don't overcorrect. Close the gap steadily, stay just under market, and keep your good tenants in place while you do it.
JESSE BAILEY Multifamily Broker & Advisor 49 Units jbailey@49units.com
Jesse Bailey is the owner of 49 Units Multifamily Brokerage and Advisory Services. He is a Florida licensed Certified Public Accountant (CPA), Florida licensed Real Estate Broker, member of the Realtors Association of the Palm Beaches, and a founding member of Strong Towns, a nonprofit dedicated to making communities financially strong and resilient.
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AI RENTAL FRAUD AND NEW ASSET PROTECTION RISKS FOR LANDLORDS For years, rental property owners worried about familiar risks such as tenant lawsuits, slip-and-fall claims, evictions, insurance gaps, unpaid rent, and property damage. Those risks still matter, but a new threat is quickly becoming harder to ignore: AI assisted rental fraud.
RENTAL FRAUD IS BECOMING EASIER TO COMMIT Rental fraud is not new. What is new is how convincing and scalable it has become. Industry data shows why landlords are paying closer attention. In a National Multifamily Housing Council survey conducted with National Apartment Association members, 93.3% of respondents reported experiencing fraud in the previous 12 months, and 70.7% said fraudulent activity had increased. For landlords, this means an applicant can look financially qualified on paper while the underlying identity, income, or documentation is false.
AI TOOLS CAN NOW GENERATE:
• Fake pay stubs • Forged bank statements • Fake employment letters • Synthetic IDs • Manipulated listing photos • Fake landlord communications • AI-generated lease documents
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WHY SMALL LANDLORDS ARE ESPECIALLY VULNERABLE Large apartment operators often have dedicated teams, layered screening processes, and fraud detection software. Smaller independent landlords usually do not.
properties. One bad tenant or scam can quickly turn into months of lost rent, legal expenses, eviction costs, property damage, unpaid utilities, and stress. For decades, many landlords relied on common sense screening: review the pay stub, call the employer, check the ID, and trust their instincts. In today’s environment, that may not be enough. after receiving what appeared to be a cashier’s check for the security deposit, only to later learn the check was fraudulent. Police said the suspects allegedly used fake IDs, counterfeit checks, and even sublet one unit to another unsuspecting renter. For landlords, the case highlights a serious risk: by the time fraud is discovered, the wrong person may already be inside the property and getting them out may require legal action. Landlords should periodically search for their own rental addresses online, watermark listing photos when possible, and make sure applicants know the official way to apply.
That makes mom and pop rental owners especially vulnerable to fake applications, forged income documents, stolen identities, counterfeit checks, wire fraud, and fraudulent listings of their vacant THE FAKE LISTING PROBLEM Another growing issue involves scammers stealing legitimate rental listings and reposting them online using AI-enhanced photos and fake identities. These scams commonly appear on platforms such as Craigslist, Facebook Marketplace, and rental listing websites. In many cases the property and owner are real, but the listing itself is fake. Scammers often collect deposits or application fees from prospective renters before disappearing. A recent case involved two suspects accused of renting properties in several Los Angeles neighborhoods using fake identities and counterfeit checks. One landlord said he handed over the keys
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AI-GENERATED SCAMS ARE BECOMING SO REALISTIC THAT EVEN EXPERIENCED PROFESSIONALS CAN STRUGGLE TO IDENTIFY THEM.
AI IS ALSO INCREASING WIRE FRAUD RISK
Property owners involved in refinances, acquisitions, or real estate transactions face another growing danger: AI-driven impersonation scams. Real estate investors and landlords are particularly attractive targets because transactions often involve large wire transfers and multiple third parties. The FBI reported more than $16 billion in internet crime losses in 2024, a 33% increase from 2023. Experts warn that AI-generated scams are becoming so realistic that even experienced professionals can struggle to identify them.
TO TRICK PARTIES INTO REDIRECTING FUNDS, CYBERCRIMINALS ARE NOW USING: • Cloned voices • Fake emails • Fraudulent escrow instructions • Deepfake communications
THE BIGGER ASSET PROTECTION CONVERSATION
Traditionally, asset protection planning focused on LLC structures, insurance, trusts, and liability exposure. Those strategies still matter enormously. But modern protection planning increasingly includes operational and cyber-related safeguards as well. For rental property owners, the conversation is evolving from “How do I protect my assets from lawsuits?” to also include “How do I protect my properties, accounts, transactions, and identity from AI driven fraud?” This is where stronger income and identity verification can make a major difference.
AAOA now offers IRS Income Verification. This gives landlords a more reliable way to verify income directly through IRS sourced records instead of relying only on documents supplied by the applicant. The service also includes an identity verification step that requires the applicant to take a live selfie designed to prevent fake or spoofed images and match the applicant against identity records. For landlords worried about AI generated documents or synthetic identities, this provides a much stronger layer of protection. IRS Income Verification is $15 and is now available to order by emailing customerservice@aaoa.com.
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5 Practical Steps Property Owners Should Take Now
1
An LLC is not “automatic protection.” Many rental property LLCs are poorly maintained or improperly structured. Entity maintenance, operating agreements, and proper separation between personal and business activity remain critical. Click here to get a complimentary asset protection review.
Review Your LLC Structures
AN LLC IS NOT “AUTOMATIC PROTECTION.” MANY RENTAL PROPERTY LLCS ARE POORLY MAINTAINED OR IMPROPERLY STRUCTURED.
Property owners should be increasingly cautious about digital only applications, unverifiable employment records, suspicious urgency, altered documents, and inconsistent identification. Many landlords are moving toward stronger verification procedures because AI-generated fraud is becoming harder to detect manually. This means ordering a comprehensive tenant screening that includes an SSN Fraud report and income verification. Never rely solely on emailed wire instructions or payment changes. Always confirm sensitive financial requests through separate verified communication channels. Remember that cashier’s check or money order can also be faked. Do not provide the keys to the unit until the money has cleared and you have called your bank to confirm.
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Tighten Tenant Verification Procedures
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Verify Financial Instructions Independently
NEVER RELY SOLELY ON EMAILED WIRE INSTRUCTIONS OR PAYMENT CHANGES.
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Many owners assume traditional landlord insurance covers every modern fraud scenario. It often does not. Cyber liability and fraud-related protections are becoming increasingly important components of overall risk management. Click here to get a complimentary review of your insurance policy and shop for what you need.
Review Insurance Coverage
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Practical Steps Property Owners Should Take Now
Property owners now manage enormous amounts of sensitive digital information such as banking portals, lease records, tax records, online payment systems, and smart property systems. Weak digital security can create significant exposure. Landlords should use strong, unique passwords, turn on multi factor authentication whenever possible, and avoid sending sensitive documents through unsecured email. It is also important to review who has access to shared files, property management platforms, listing accounts, and payment systems, especially after a vendor, employee, or contractor relationship ends. Digital security is now part of rental property protection. Landlords need to protect not only the property, but also the systems and accounts connected to it.
Protect Digital Access 5
WEAK DIGITAL SECURITY CAN CREATE SIGNIFICANT EXPOSURE.
FINAL THOUGHTS Most rental property owners still think of asset protection primarily in terms of lawsuits and LLCs. But the risk environment is changing rapidly. Today’s property owners must increasingly think about cyber fraud, AI-generated scams, identity theft, transaction security, digital verification, and operational safeguards. In the AI era, protecting rental income properties is no longer just about protecting the real estate itself. It is also about protecting the systems, transactions, and identities connected to it.
BRADLEY BARTH, ESQ. Partner BarthCalderon, LLP
Bradley Barth is a partner and Supervising Attorney of the firm’s Transactional and Estate Planning Department encompassing business formations and transactional matters, estate planning, domestic and offshore asset protection, probate, trust administration, tax and real estate law. He views his role as a trusted and long-term advocate of asset protection planning in helping his clients achieve and protect their financial goals and lifetime accomplishments. If you are a rental property owner and would like to review your current asset protection structure, entity setup, or estate planning strategies, the attorneys at BarthCalderon LLP work with property owners nationwide to help evaluate liability exposure and long term wealth protection planning.
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12 QUESTIONS EVERY LANDLORD SHOULD ASK BEFORE YOU HIRE A PROPERTY MANAGER: After more than 25 years of investing in apartment buildings and multifamily real estate, one lesson has become very clear: operational performance often matters more than the original acquisition itself. Many multifamily acquisitions underperform not because the deal was poorly purchased, but because the property was poorly operated after closing. Many apartment owners spend months underwriting acquisitions, negotiating financing, and analyzing renovation budgets, yet spend surprisingly little time evaluating the company responsible for the day-to-day performance of the property. In multifamily investing, property management directly impacts occupancy, collections, operating expenses, tenant retention, and property value. Even modest increases in delinquency, turnover, concessions, or maintenance costs can materially impact annual cash flow, especially across larger unit counts. Before hiring a property manager, landlords should ask these twelve questions.
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1. How Do You Increase Net Operating Income?
Sophisticated investors focus on NOI growth, not just management fees. An experienced management company should clearly explain how they improve occupancy, reduce delinquency, increase collections, control expenses, and strengthen tenant retention. Operational problems often show up in collections and turnover long before they appear in occupancy numbers. Even small improvements in NOI can create substantial increases in apartment value. For example, increasing annual NOI by $100,000 at a 5% cap rate theoretically increases property value by $2,000,000.
Net Operation Income (NOI) Cap Rate (%)
Property Value
Saving 1% on management fees can cost far more through turnover, delinquency, and poor execution.
SAVING 1% ON MANAGEMENT FEES CAN COST FAR MORE THROUGH TURNOVER, DELINQUENCY, AND POOR EXECUTION.
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2. What Is Your Occupancy Strategy?
High occupancy alone does not necessarily indicate strong apartment performance. A property operating at 99% occupancy with below market rents and heavy concessions may be underperforming financially. Strong management companies understand the balance between occupancy, rental growth, tenant quality, concessions, and economic occupancy. The goal is not simply filling units. The goal is creating durable cash flow and increasing long term property value.
THE GOAL IS NOT SIMPLY FILLING UNITS. THE GOAL IS CREATING DURABLE CASH FLOW.
3. How Do You Screen Tenants?
Weak screening standards often lead to higher delinquency, turnover, property damage, lease violations, and eviction costs. In many rentals, poor tenant screening creates operational instability before it appears in the financial statements. Strong multifamily operators maintain consistent screening procedures involving income verification, rental history, employment verification, and credit analysis. Stable tenancy usually leads to stronger collections, lower turnover, and better performance.
POOR TENANT SCREENING CREATES OPERATIONAL INSTABILITY.
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4. What Is Your Maintenance Philosophy?
Maintenance is one of the largest controllable expenses within apartment ownership. Sophisticated multifamily operators understand the financial impact of preventative maintenance, unit turn efficiency, vendor management, and capital planning. Deferred maintenance may temporarily improve short term cash flow, but it often reduces tenant retention, increases future capital costs, and weakens property performance. Experienced apartment owners understand that maintenance decisions are financial decisions that directly impact NOI and leasing performance.
5. How Often Will I Receive Financial Reporting?
Apartment investing is ultimately a numbers business. Professional management companies should provide timely reporting on collections, expenses, occupancy, delinquency, leasing velocity, and operating trends. Strong reporting allows investors to identify problems before they materially impact performance. Rising delinquency, elevated turnover, or increasing repair expenses often indicate deeper issues.
6. How Do You Perform During Economic Downturns?
The real test of a property manager comes during difficult market conditions. Many management companies appear effective during strong economic cycles. Rising interest rates, oversupply, inflationary pressure, or declining employment often expose operational weaknesses quickly. Strong operators understand expense control, tenant retention, collections, and cash flow preservation during uncertainty. Apartment owners should look for managers who understand long term asset preservation, not simply leasing activity during favorable conditions.
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7. How Do You Handle Rent Increases?
Poorly executed rent increases can create unnecessary turnover and vacancy. Experienced operators understand local market conditions, tenant psychology, lease renewal strategy, and occupancy management. Sometimes retaining a high quality tenant slightly below market rent creates stronger returns than aggressive rent growth followed by costly turnover. On larger apartment properties, even small increases in turnover can materially impact annual cash flow once vacancy loss, concessions, repairs, and leasing expenses are considered.
8. What Technology Platforms Do You Use?
Professional management companies should provide modern systems for online payments, maintenance tracking, digital leasing, and owner reporting. Operational efficiency becomes increasingly difficult without strong technology systems in place. Sophisticated apartment investors increasingly expect real time visibility into property performance and operational trends.
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9. How Do You Control Operating Expenses?
Expense management is one of the fastest ways to create apartment value. Reducing annual operating expenses by $50,000 at a 5.5% cap rate theoretically increases property value by more than $900,000. Experienced operators understand vendor negotiations, payroll efficiency, preventative maintenance, utility management, and contract oversight. Over time, disciplined expense management can create substantial equity growth.
OVER TIME, DISCIPLINED EXPENSE MANAGEMENT CAN CREATE SUBSTANTIAL EQUITY GROWTH.
10. What Is Your Tenant Retention Strategy?
Turnover is expensive. Vacancy loss, repairs, marketing costs, concessions, utilities, and leasing expenses can quickly erode apartment returns. In many multifamily properties, replacing a resident costs substantially more than owners initially estimate. Strong management companies focus on resident satisfaction, consistent communication, responsive maintenance, and proactive lease renewals. Strong tenant retention generally leads to more stable cash flow and better performance.
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11. How Do You Communicate With Owners?
Apartment owners should clearly understand reporting expectations, approval procedures, emergency protocols, capital expenditure authorization, and escalation procedures before entering into a management agreement. The best management companies operate like strategic partners rather than third party vendors. They understand that apartment ownership is an asset management business focused on financial performance.
12. How Are Your Fees Structured?
The lowest management fee rarely produces the strongest investment returns. Sophisticated apartment investors focus on execution, NOI growth, tenant retention, expense management, and long term value creation rather than simply minimizing fees. Apartment owners should clearly understand leasing commissions, renewal fees, maintenance markups, construction oversight fees, and termination provisions before entering into a management agreement. An experienced management company that materially improves occupancy, collections, and operational efficiency may create significantly greater value than a lower cost competitor. FINAL THOUGHTS The right management company can improve NOI, strengthen occupancy, reduce turnover, stabilize collections, and materially increase property value. The wrong one can quietly erode cash flow and weaken years of hard earned equity. Successful multifamily investing is rarely passive. Long term performance is driven by disciplined operations, financial oversight, expense control, tenant management, and execution after closing. Apartment owners who treat property management as a strategic financial function generally outperform those who view it primarily as an administrative expense.
BRIAN TULIBASKI Commercial Real Estate Agent Horizon Real Estate Group Connect with Brian
Brian Tulibaski is a Fargo Commercial Realtor with more than 25 years of experience investing in apartment buildings and multifamily real estate across the Midwest.
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PRESIDENTIAL LANDLORDS: THE U.S. PRESIDENTS WHO DABBLED IN REAL ESTATE The entire world is very aware that President Donald Trump built a massive real estate empire spanning hotels, office towers, golf courses, and residential developments. His name has become synonymous with real estate investing on a global scale. But did you know there were other U.S. presidents who dabbled in the real estate world as well? While none remotely reached Trump’s level of real estate branding or development, several presidents owned investment properties, speculated on land, rented portions of their homes, or became involved in real estate transactions that reflected the economic realities of their times. Their experiences offer an interesting glimpse into how real estate has played a role in American presidential history.
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ABRAHAM LINCOLN: AMERICA’S EARLIEST “HOUSE HACKER?”
When discussing presidents and real estate, Abraham Lincoln is not usually the first name that comes to mind. Yet Lincoln’s homeownership story contains elements that modern investors might find surprisingly familiar. In 1844, Lincoln purchased a modest home in Springfield, Illinois, for $1,500. It would become the only home he ever owned. Lincoln, his wife Mary Todd Lincoln, and their children lived there for approximately 17 years while he built his legal practice and launched his political career. Over time, Lincoln expanded the property significantly, including the addition of a full second floor. While evidence remains limited, some historians have speculated that Lincoln occasionally rented rooms within the home. If true,
it would resemble what we now refer to as “house hacking.” This is the practice of living in a property while generating income from other portions of it. However, it is important to note that the Lincoln home was first and foremost a family residence. Any room for rent would have been more similar to a boarding-house arrangement than a structured investment strategy. While Lincoln was certainly not a real estate investor in modern terms, his ownership, improvement, and possible partial rental use of his family home makes him one of the earliest known presidents associated with real estate-based income.
SOME HISTORIANS HAVE SPECULATED THAT LINCOLN OCCASIONALLY RENTED ROOMS WITHIN THE HOME.
For $60k , you can own this house, just around the corner from the Lincoln house.
Click here to view the listing.
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