Landlord FAQ

Tenants who are on Happy Doors Property Management’s lease agreement will be required to pay rent each month by the 1st, without a grace period. There are certain cases in which rent may be delayed such as those participating in section 8 or tenants who receive some form of government aid in which we are legally obligated to grant them additional time.

We understand the importance of processing payment to our property owners as quickly as possible. This is why HappyDoors Property Management is committed to initiating disbursements on or before the fifteenth of the month and is typically received around the 10th or 11th depending on weekends or holidays. This is to provide our Oahu property management team sufficient time to process the rents that are received, pay any outstanding bills and invoices, as well as preparing monthly financial statements. Please note that it may take several business days before the funds are deposited into your bank account.

Management fees are only charged when a lease has been secured, depending on the selected service.

Trust accounts are FDIC insured accounts specifically designed to hold funds on someone else’s behalf. Companies specializing in property management on Oahu generally use trust accounts when processing money that belongs to tenants or property owners. These funds are usually only held for specific purposes as detailed in our management and lease rental agreements. Money and rents held in trust accounts will be used only according to the terms within the agreement between the all parties involved.

For example: HappyDoors Property Management will hold onto the tenant’s deposit with a separate trust account until a tenant moves out. During this time, the money still legally belongs to the tenant, however, we are holding on to it as a form of collateral to ensure that the tenant adhered to the terms of the lease rental agreement. When the tenant moves out, we must then return the deposit to the tenant after making any appropriate deductions based on the terms of the lease agreement.

In Hawaii, security deposits are considered to be the legal property of the tenant. Generally, they are held by a landlord or property management company as a form of collateral to help make sure the tenant does not violate the terms of the lease agreement. The owner can only make deductions from the deposit after the tenant has vacated the rental property. In general, the security deposit can only be applied towards unpaid or late rent, property damage, past due balances, and any other damages the owner may incur if the tenant breached a term of the rental agreement. The tenant’s security deposit may not be used towards items that are considered normal wear and tear, which is any wear that a leased property would accumulate over the length of the lease resulting from normal use of the rental property.

When a renting a property through HappyDoors Property Management, we use the income from monthly rent to pay expenses that you may incur. In some cases, we may ask the owner to provide us with money to pay for expenses if the monthly rent amount is not enough to pay for all the charges or the property is vacant. This does not happen very often and normally only comes up during larger repairs such as installing new flooring.

A benefit with using our management services is that we have established great working relationships with some of the best vendors available in Honolulu and the island of Oahu. Some of our vendors are able to setup payment plans usually over a two to three month period so that you do not have to pay for a large repair all at once. This usually only applies to occupied properties since there is a signed lease in effect.

Another way to pay for larger repairs is using a credit card. A few of our preferred vendors accept credit cards. For those who are not, you can use a credit card to fund your account with HappyDoors. This is a great tool for our property owners as you not only can stretch out payments for larger repairs, but you can also take advantage of credit card rewards that you may be signed up for. Please do note that there is a credit card processing fee.

Step 1: If rent is not received from the tenant on the first, a late fee will be applied to their account.

Step 2: Our Oahu property management team will try to make contact with the tenant either by phone or email to discuss why the rent payment is late.

Step 3:  We will initiate the eviction process around the 5th of the month starting with at 5 Day Notice of Non-Payment of Rent. The five business days starts once it’s received by or delivered to the tenant. There may be delays in processing this notice based on weekends, holidays, or if our Oahu property management team has been in contact with the tenant and are actively working on a payment agreement.

Step 4: If the tenant does not respond within the five business days, our Oahu property management team will attempt to make contact with the tenant to discuss the past due rent.

Step 5: If we are unable to get a hold of the tenant or they are uncooperative, our Oahu property management team will contact you and request and eviction from the court. We hire an attorney to assist with the eviction in order to make sure that the process is carried out correctly. Procedural mistakes or poorly written legal documents can result in delays to the eviction process.

Step 6: The tenant will be served a notice that an eviction filing has taken place and that an initial response or answer hearing has been set.

Step 7: During the initial response or answer hearing, the tenant will be given an opportunity to contest or state their claim. In Hawaii, it's typical that if a tenant shows up, then the proceeding will move towards a mediation session. If the tenant is not present, then the court will issue a default judgement granting the eviction.

Step 8: During the mediation hearing, the tenant and landlord, or their appointed representative, are given an opportunity to come to arrangement for the tenant to pay the balance owed. If an agreement is reached, then the paperwork will be filed with the court. In some instances a tenant will adhere to the terms of the agreement. If this happens, then the court will usually grant an eviction depending on the terms of the mediation agreement.

Step 9: If a mediation agreement cannot be formed, we will be informed by the court when the hearing date is where a judge will allow both the tenant and landlord an opportunity to speak. Based on the information provided, the judge decides if they will grant the eviction. It may take a couple weeks before the hearing date will be set.

Step 10: If the judge grants the eviction, a legal notice will be sent to the tenant informing them that they will need to vacate the rental property.

Step 11: The eviction lockout will be performed by a sheriff and locksmith. Anyone who may be at property will be required to leave and the locks will be changed.

Step 12: Once the eviction lockout is complete, we will get the new keys from the locksmith which may take a couple days.

Step 13: Our Oahu property management team will go out and evaluate the property once the keys have been received. We will be able to determine if the property needs any repairs at this point in time and if we need to coordinate with the tenant to have any personal belongings removed. We legally have to provide the tenant with fifteen days to remove any personal belongings left in the rental property.

To assist in covering our expenses when attempting to collect past due rent, HappyDoors Property Management will keep legal and late fees that are recovered from the tenant.

The tenant and owner are required to supply a 45 day written notice of their intent to vacate the property. When a notice has been received to vacate the property, a letter will be sent to the tenant providing them with instructions on what they should do during their final days in the home.

• The tenant must pay rent for their last month which may be prorated depending on their move-out date and lease termination date.
• We require the utilities to stay on in their name up to the day that they move out. Our Hawaii property management team will automatically transfer the utility services on your behalf to minimize any disruption in service.
• The tenant is required to have the carpet professionally cleaned.
• We ask the tenant to thoroughly clean the property:
  • All doors, trim, and baseboards
  • Draperies, blinds, windows, and window screens
  • All Appliances
  • Ceiling fans and light fixtures
  • Water fixtures such as sinks, faucets, bathtubs / showers and toilets
  • Countertops and cabinets
  • Flooring
  • Face plates and protective covers around outlets, light switches, etc.
  • Sweep garages floors, porches, balconies and lanais
• The tenant must leave the yard in good condition:
  • Trim and prune bushes and shrubs
  • Remove trash and debris from the yard
  • Pull weeds
  • Replace any plants which may have died
  • Cut and trim the grass
• Repair damage caused tenant:
  • Patch larger holes in the walls
  • Replace batteries or light bulbs that may have gone out
  • Clean or replace air filters

As your property management company, we will need to retain a small reserve to cover expenses which could come up during the month while we are waiting for the tenant to pay their next month’s rent. It can also be used towards small expenses while the rental property is vacant like utility bills or advertising expenses.

While our Hawaii property management team makes every effort to keep minimize your expenses, there are times when we do not have sufficient funds in your account to pay for all the expenses in a single month. Depending on the amount needed, we may be able to negotiate a payment plan with the vendor or you can provide us funds:

• Electronically through our website via credit card, or online transfer from your savings and checking account.
• Authorizing us to draft the funds directly from your savings or checking account if you are signed up for direct deposit.
• Mailing a check to HappyDoors Property Management.

Our Oahu property management team prepares all of your year-end tax paperwork by the thirty-first of January each year. We know how important it is to file your taxes early so we have made it our goal to process this information for you as fast as possible. We will provide you with:

• Annual income statement
• year-end financial statement
• 1099 tax form

Hawaii has a special consumption tax in the amount of 4.5% called the General Excise Tax which all landlords are required to pay. To help make your life easier, HappyDoors Property Management can make arrangements to pay your GE Tax Payments as a free service to you. Just one more thing we do to try and make your life easier.

If you have not applied for a GE Tax license, we can also do this for you.

In addition to the GE Tax, Hawaii requires all landlords who lease out there property for a period of less than six months to pay an additional 9.25% Transient Accommodations Tax. This applies to all leases less than six months, but usually affects vacation rentals. The total tax rate is 13.75% for both the GE and Transient Accommodation tax. As a free service to you, our Hawaii property management team can also make arrangements to pay the Transient Accommodation Tax along with your GE Tax Payment.

If you have not applied for your GE Tax license, we can also do this for you.

HOA is short “Home Owners Association.” It’s a group of homeowners who belong to the same building or neighborhood that have created rules and regulations for residents to follow. Rules for each community may and normally there is a fee for owning property that is located in an HOA community or building. The fees are used towards any expenses incurred by the HOA for common area maintenance, legal fees, and administrative costs associated with managing the HOA

We understand the importance of preserving your investment which is why HappyDoors Property Management has made it easy for tenants to place a service request. When a tenant notices something that may need attention, they can notify our office quickly through our website, by emailing us, or calling our Hawaii property management team. After receiving a request from the tenant, we start off by trouble shooting the problem. If we are not able to resolve the problem, then we will work with some of the best repair technicians available and have them assess the problem. If it’s a small repair, we will have them repair it then to avoid any further inconvenience to the tenant and, more importantly, help save you money on additional trip charges. If it’s a larger repair, we will request an estimate from the technician and submit it to your for consideration.

In the event of an emergency, as a property management company, we are required to act immediately. During these rare occasions, our goal is it minimize your risk and expenses and our team will keep you informed every step of the way.

In order to protect your interest and the interest of the company, HappyDoors Property Management has been warned by our insurance providers and attorney that we should not keep a copy of the keys for your rental property. Keeping a copy increases your liability and risk of being accused of theft and vandalism.

One of the most important reasons for a landlord to have a key is if there is an emergency at the property which requires immediate action and the tenant is not available. Fortunately, we are prepared to act quickly if something like this were to occur. A member of our Oahu property management team will arrange for and meet a locksmith at the rental unit so that we can secure your investment.

Offering a onetime pest treatment not only helps us set a standard that the tenant will have to follow. In addition, it also can help identify insects like termites which could potentially damage your investment. After the initial treatment, the tenant will be responsible for general pest control with a few exceptions for insects that may pose a serious risk to the property.

One of the biggest deterrents when leasing out a property is cleanliness. If a rental unit is not very clean, it will not show well and leave the prospective tenant with a bad impression. People often associate cleanliness with maintenance and a home that feels or looks dirty also comes across as not being well maintained. A clean home can make a huge difference in the amount of time it takes to lease out a home, the quality of the tenant, and the amount of rent you receive.

Another important reason to have your investment cleaned professionally is that it helps establish a standard that the tenant must then follow. One way to look at it is that it’s a onetime investment. Once it’s done, the tenant is supposed to return it in the same clean condition. If they don’t, then our Hawaii property management team can use a portion of the tenant’s security deposit towards a professional cleaning service.

There are many landlords who will not allow tenants to have pets in their rental property which inadvertently makes it harder to locate a home for tenants who have pets. There are a lot of tenants, especially in Hawaii, who have pets. Just by letting prospective tenants know that you open to considering pets, it expands the total number of potential tenants who may have interest in leasing your property. To help offset the additional wear and risk that a property may incur as a result of a pet, an investor can require an additional pet deposit and / or increase the monthly rent.

Landlords and management companies in Hawaii cannot request more than one months’ rent towards the tenant’s security deposit. However, an additional deposit can be collected for pets in an amount agreed upon between the tenant and owner.

Our Hawaii property management team has determined that the best approach to lease out a property quickly and to a well-qualified tenant is by making sure the property is in great condition before listing it for rent. Presentation and perception are extremely important when leasing out property. If someone gets the wrong impression because the rental unit is not quite ready, then it can easily turn them away.

Alternatively, someone who may apply for a property that is in need of repair may have lower standards. This could mean that they will not maintain the property as well as most other tenants could prove to be more costly in the long run if they don’t maintain or report problems with the property.

As your property manager on Oahu, we have vested interest in your rental property. By listing us on your insurance policy, it extends your coverage to help protect our interest. Another benefit is it gives us the ability to file an insurance claim for you if something were to happen at the property such as a fire or water leak. This is required for all of our clients.

Like you, the last thing we want is to run into unexpected surprises. Keeping the utilities turned on while we are searching for a new tenant helps us avoid unpleasant surprises by giving the prospective tenant an opportunity to fully evaluate the property and test the amenities before they submit their application. The goal is to limit the amount of work that may be needed shortly after a tenant moves into the property. In addition, it also helps with showing the property by allowing us to turn on lights and demonstrate how to operate various things in the home that the prospective tenants may have questions about.

In order to make sure you are getting the best rent possible, our Hawaii property management team will perform a detailed analysis of the current rental market. This allows us to compare your rental property to other properties that are similar which helps us identify the appropriate rent range for your investment. Things that we take into consideration would include how many bedrooms and bathrooms, age, square footage, location, appliances, if its furnished, etc. We also take into consideration upgrades like hard wood floors or granite countertops, but we have found that these types of improvements do not usually increase the value but instead only help the property lease out more quickly. Once we have identified the rent range, we then contact you to discuss what your starting rent price will be.

There are three major components that factor into how quickly a property will rent out; condition, location, and the rent amount. Properties that are in great condition and priced correctly should be leased within two to three weeks. If a property is vacant longer then this time period, it usually means we need to adjust the rent price and possible make some additional improvements to the property depending on the condition.

HappyDoors Property Management is committed to exceeding your expectations with our happy and innovative team in hopes of developing long term relationships. To accomplish this, we must provide exceptional service without making sacrifices in quality that is often found in other companies practicing property management on Oahu. Common problems that exist in the industry includes poor communication, erroneous or unexplained spending, and overlooking the small details.

Our management fees are based on the overall cost to manage a property in order make sure that we are providing you with the best service possible. However, we do offer discounts for high-end or luxury rentals starting around $3,600 per month and investors with multiple properties or communities.