Seven Successful Habits
House corporations are designed to provide safe and adequate chapter housing. To be successful,
consider the following habits:
1. Operate Like a Business
- File for incorporation.
- Conduct regular meetings.
- Prepare and distribute minutes for all meetings.
- Prepare an annual budget based on historical data.
- Develop a well-balanced board of directors with a mix of ages, experience and backgrounds.
2. Execute a Rental Agreement
- Specify the amount of rent for each period (monthly, semester, or annually).
- Establish reasonable rules and policies (like alcohol/substance free and no smoking).
- Specify the right of the house corporation to terminate the agreement if tenants breach the agreement.
- Require written rental agreements signed by parents/guardians from all tenants which includes a security deposit.
- Conduct regular property inspections for both cleanliness and maintenance.
- Have a check-in and check-out procedure.
- Provide professional cleaning of the bathroom and kitchen to ensure sanitary condition.
3. Charge Fair Market Rent
- Charge fair and competitive market rent. If you are fortunate enough to collect more than you need, put it into a reserve fund. You’ll need it.
4. Establish a Reserve Fund
- Establish a maintenance and replacement reserve fund.
- Update the reserve analysis every year.
- Schedule projects during the summer or winter break to avoid disruption.
5. Reduce the Debt
- Reduce interest on debt when possible by refinancing.
- Always charge a fair market rent even when debt is paid off to build reserves.
6. Fill the House
- Establish a fair market based on what is needed to pay house corporation expenses (insurance, maintenance, debt, etc. and reserves).
- Close the house in the summer unless it will raise more revenue that the maintenance costs required to repair the damage inflicted.
7. Promote a Sense of Ownership
- Allow undergraduates to attend board meetings to promote “buy in”.
- Solicit input from the undergraduates to provide a facility that will be competitive in amenities.
- Reacquaint the undergraduates every year with the purpose and functions of the house corporation.
Successful house corporations don’t happen by accident. Follow these time tested habits and become one of the success stories.