What are RTSTs?

Back in September of last year, Governor Newsome signed into law AB 2559, allowing for reusable tenant screening reports (RTSRs) for rental applicants that can be used multiple times within a 30-day window.

WHAT ARE RTSRS? They are reports prepared by a consumer reporting agency (like Trans Union, Experian, or Equifax) containing a 7-year background on the potential tenant with regard to CRIMINAL HISTORY and EVICTIONS. Originally the bill called for this process to be mandatory, but that part has not made it into the law.

POSSIBLE PROBLEMS Most housing providers will not want to take a chance with regard to breaching current criminal records disclosures, especially with recent changes. How will the RTSR be presented? Most landlords would not accept it directly from the tenant, so it will need to be provided by the agency that produced the document. Not quite sure how that will work. This also precludes housing providers from charging a fee for screening. I don’t personally charge a fee, but many do in order to recover their costs. This would deny those charges.

MY VIEW.  My opinion is that I will continue, for the time being, as I have done in the past. I will order, at my own expense, my own consumer agency reports, I will make my own calls to past landlords and other pertinent individuals listed on the application. I will also continue to drive by a prospective tenant’s former residence to see how it looks. I can often gather more with a drive by the former residence than from phone calls to references. This is not always a game changer, but it is never a bad idea. A bad choice in a tenant can cause many problems down the line.

AT THE END OF THE DAY The new measure will probably experience changes as it is implemented, but most likely will become the norm. We should comply with the new legislation, as housing providers, but we can always go the extra mile. Do the calls, the research, and make sure you rent to a well-qualified tenant each time you have a vacancy.

It is always good to check with your real estate attorney and your local apartment association when you get a vacancy to make sure you are aware of any new changes or new laws.

“Excellence is not a singular act but a habit. You are what you do repeatedly.” Shaquille O’Neal

What we at PRS PROPERTIES CAN DO. We can do a rent survey, to show you whether you are under-valuing your rents and what other owners with buildings around your property are charging. We can also give you a good idea of what your building would sell for in its present condition. Even with rent control restrictions, it may be time to raise rents before the sale. We can also recommend experienced licensed contractors who can perform any repairs or installations you may need prior to selling. We can also look at your building for other changes that might allow you to get a higher value in order to create value without huge expenses for your building. We can help you to get the maximum value for your property, should you decide to sell, or the maximum return if you are planning to keep your building.

We always have many investors who are looking for “as-is” properties and are willing to purchase with low rents, a moratorium or even with a problem tenant in place. We have put together numerous transactions over the years which involve properties that are not listed for sale. Many investors are in 1031 exchanges and need to identify a replacement property before their 45-day identification period runs out.

Should you decide to put your property on the market, we will put together an aggressive, targeted and professional campaign to get your property sold fast. We have been doing this for over 40 years, and we will use all the tools available to bring you the most dollars at closing. If you are thinking of selling or are just curious about the value of your property, don’t hesitate to give us a call.

Remember- KNOWLEDGE IS POWER!