Easy Investment Property Management with Cozy
Rent out your house and go here! (Free camping near the Valley of Fire in Nevada.)
Forget broken toilets. A handyman on speed dial can fix those. I think the most time-consuming part of renting out a property is screening tenants and arranging payment information. I’d wager you landlords out there dread it. If you don’t, your anti-anxiety medication is working!
We mostly invest via index funds, but own one investment property and our personal residence, both of which we rent out. In the recent years, we’ve leased to a half dozen people and it is always a pain in the neck to manage the initial setup.
For short stays, Airbnb works great, but we tend to leave our house for longer periods of time or rent our other investment property for at least a year. There are services for bigger investors (e.g. Appfolio), but they charge $200/month minimum, killing cash flow for single-family properties. Plus, professional online services have 22,231 features like a fancy T.V. remote where all you know is ON/OFF.
Enter Cozy, a Portland startup that changes this. It’s a free service aimed at small investors who don’t use property management companies (which charge ~10% for long-term rentals and half your child’s future income for short-term) and want a streamlined way to manage tenants. Nothing in this for me – I simply like Cozy’s service and think it would benefit small-scale real estate investors.
Why use Cozy? It’s simple, fast, and will save you time and headaches. Here are the basics:
- Set up a simple account at Cozy.co.
- Enter your property into their system, which takes just a few minutes.
- Set up your bank account info so that tenants can send you cash (by the truckload, hopefully).
- Cozy generates a link to a tenant screening application that you can share online, email, or include in any property listing (e.g. Craigslist). Sending PDFs via email and getting incomplete crap back is so 2003 – this is an easy, online method that notifies you when a new application comes in. On the tenant side, it’s simple, and even lets someone import employer info from LinkedIn. (I went through the process so I knew what to expect.)
- A credit check service is provided by Cozy, the cost of which you pass through to the tenant. You can also send them to get a free one at annualcreditreport.com if you don’t need a report with a credit score. You also can require a background check if desired. (In response to Trisha’s comment below – we always require a credit report with a score, and that is my recommendation!)
- Best part? Payment terms and setup are clean. No more giving tenants your address to mail a check, or figuring out monthly deposits bank-to-bank via a voided check. Cozy acts as the intermediary (for free!), and will initiate a withdrawal each month. It also allows you to set up split payment for multiple tenants, including for the security deposit.
That’s it! I would do screenshots, but any middle school kid can text 1,432 times and navigate their system at the same time. You can figure it out. So great to see a startup provide practical and useful functions instead of just another photo sharing app.
For all of you who are self-managing properties, I think this is a great way to streamline things. I am digging it and will not be going back to PDF applications and hacked-together payment setup. Next time you transition tenants, check out Cozy.
I wish we had known about Cozy two weeks ago! Dave had a lot of trouble using LegalZoom (I think it was). So this would eliminate the need to sign up for free seven day trials and nag our new tenants about getting us documents before we’re charged?
Rocket Lawyer is dead to me. Jen said it best…I wish we had known about this two weeks ago!
@jensoto:disqus Totally with you. Free trials timing out sounds like a negative way to enter the landlord realm! @david_hoch:disqus, glad I could (almost) help. Maybe my next post will actually benefit you!
Is that your house?? It’s beautiful! My husband and I have always thought of the idea of doing an investment rental but not sure it make sense in our area of the country, interesting stuff though!
Nope! I wish… That’s a fantastic rental at the beach.
Investment properties make sense if you charge enough for rent. 🙂 There is a balance point in the market that makes it worthwhile for an owner, otherwise they wouldn’t be buying it. I know that sounds simple, but it’s only to say that there are always opportunities to buy. Check it out!
We’re about a year away from taking off for a couple of years – have one rental property and will be renting our primary out as well. Did you rent your house out furnished or unfurnished and before Cozy did you just manage the lease yourself? We’re in SE PDX also and looking at Sprinters to build out so would love to take a look at yours if you’re at any meets ups in the coming months..
Nice! Can’t recommend long-term travel enough.
We rented our personal residence furnished. If you’re planning to return to PDX, leaving your things in place will save you a huge headache when you return. I’m going to write a post about planning a road trip and getting a house ready to rent out, so hopefully that will help you out.
Cozy doesn’t manage the lease – you still need a rental agreement in place. We’ve always managed our own rentals and just had a handyman and one other helper to ping if needed. Not worth paying the 8-10% for property management fees, in my opinion.
Just hit the road last Friday on a road trip, so raincheck on the meetup. Follow along on the blog and drop a reminder note when/if we’re back in town. I’d be happy to show you the rig, and it’s always fun to meet new people!
By the way, where is your trip taking you?
Trip is going to take us pretty extensive in the US to catch up with folks all across the place, but focused on the West and some off the beaten path and warmer areas but really depends on when we’re able to take off.
We will likely be based in Portland, so leaning towards furnished if we can get the right tenants the other house has a rock solid tenant so no worries there.
We’ll eventually be winding our way down to Mexico and possible the Pan-American Hwy, though we’re just going to head out with solid plans for 2-3 months and then wing it and see where looks/feels good. Have a business to transition so hoping we’ll be kicking off around this time next year – but need to get my hands on a van so I can get it dialed in, like you guys, bikes are a big component of the build out.
We’ll likely have to head South at some stage to stretch the budget.
Always checking the blog and lots more so getting plenty of tips so keep it up and enjoy the road…
Fantastic plan! I think having a relatively concrete route initially is fine, and then you can change it 2 weeks after you leave. Whatever it takes to get out the door, ya know?
If I were going to do the bike/bed combo again, I’d probably lower the bed about three inches and consider taking the seats off the bikes for the extra headroom in bed. Prototypes-turned-permanent are how it usually works! Also, people I know who have driven into Central/South America say they almost never use their bikes, so keep that in mind when you’re allocating storage.
Drop me a line anytime with questions. Good luck with it all!
..after making a thousand decisions a day we’re looking forward to maybe making one a week when we do head out. Bikes for the US segment of the trip are a necessity but we’ll evaluate when/if we get down south, not the network of trails as we have here so less beneficial.
As we zero in on a rig we’ll connect with some buildout Q’s and buy you a beer next time you’re in town for the advice.
This Cozy program seems like it would really be helpful to my brother. He has a rental property he is trying to advertise in an inexpensive way. However, he doesn’t like any of the websites currently available. Hopefully he will like this one, especially since it’s all free!
Everything here looks intriguing as heck….except this:
“…..Or you can send them to get a free one at annualcreditreport.com if you don’t need a report with a credit score. You also can require a background check if desired…..”
I would say this is terrible advice. The last thing you should do is rely on a free, quickie credit report. This is your valuable property, and you should have any tenant thoroughly vetted. You NEED a credit score. You can adequately screen tenants only if you have a credit score. Don’t overlook this vital step. You can pass on the costs for a credit check to a tenant. However, I’d refund the cost if you reject a tenant, based on their score. It seems the prospect (who’s probably cash-strapped) shouldn’t have to bear the cost of a credit check, if you won’t give them the rental. But that’s me.
Thanks for the input! I agree. To be clear, we always get the report with a score. That suggestion was simply an option for people who aren’t comfortable charging tenants for a credit for whatever reason or didn’t want to pay for it themselves.