Boise Property Management Blog

Property Management Perspective: Boise considering capping rental application fees at $30

Julie Tollifson - Thursday, August 29, 2019

Property Management Perspective: Boise considering capping rental application fees at $30

Boise City councilwoman, Lisa Sanchez, is working to put a cap on rental application fees. While I believe her intentions are of pure heart, I feel that her suggested resolution does not solve the root of the problem.

          Sanchez is concerned that Property Management Companies are utilizing the Application Fee mark-up to increase their profitability at prospective tenants’ expense. She is proposing that we cap application fees at $30 in order to keep property management companies from doing this. The proposed consequence for a first time violation of this ordinance is a $100 fine, followed by a misdemeanor. 

          From a property management perspective, I would like to clarify. Most property management companies have a hard cost thru their screening agencies of $25 - $35, in addition to this hard cost; there are personnel expenses. While we are a business, and are aiming to make money, we are not taking advantage of our tenants. 

          In the article, author Gretchen Parsons, discusses how an existing tenant was required to pay another application fee just to qualify to move to a different unit in the same complex. While I can understand the tenant’s frustration to have to pay an additional application, I’d like to provide some insight on the other perspectives involved. 

          In the case that the tenant has lived there for a year, there is a chance that he/she could have been convicted of a felony, become unemployed, or had a significant decline in income/credit history. It is a Property Manager’s obligation to the owner & other neighboring tenants to ensure we are placing vetted tenants who qualify under our screening criteria. As a Fair Housing Provider, we are required to ensure all tenants are screened under the exact same criteria. 

          First Rate Property Management (FRPM) requires tenants to re-qualify under our screening criteria regardless of if they are an existing tenant or not. The application fee will apply for everyone that will be going through the qualifying process. Again, we have the some hard cost and personnel costs. If someone applies who is already an existing tenant and they are approved, they get their application fee back in the form of a credit on their account at the incoming property. It is a cost to tenants up front, but at the end of the day, our investors want to maintain properly vetted tenants and are willing to absorb the cost of those application fees in order to do so.

          Sanchez’ proposed ordinance is expected to crack down on property managers collecting application fees for units that aren’t available. While it is inconvenient & frustrating when someone applies and gets a call saying that the property has been rented, it is not a dead end road. FRPM works hard to accommodate as many people as possible. Whether it is the tenant, the owner, or the employee, we try to find a happy medium for everyone. Many property management companies allow tenants to apply once and have their application be transferrable between any of their available properties. In the summertime FRPM can have as many as 100 properties available to choose from. This helps to alleviate some of the concern tenants have about their application fees. 

          While I admire and appreciate Sanchez’ efforts to create a more accommodating application process for tenants across the valley, I simply ask for both perspectives to be thoroughly researched and represented in order to find a functioning solution to the application fee concern that she has expressed in this article. I hope to be able to find a compromise to be able to accommodate all parties involved. 


                                                  

Julie Tollifson, Leasing Team Leader

First Rate Property Management, Inc.
Boise, Idaho
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