Dec 20

How to Choose the Right Rental Property Manager

Investing in real estate can be a very lucrative endeavour, but it is also one that requires a lot of effort. Especially if you have bought a property with the intent of renting it, you should be prepared to provide a number of services for your tenant. From finding tenants, collecting rent, building maintenance and everything in between, collecting income from a rental property is not a passive exercise.

As such, many investors choose to work with a rental property manager so they can collect a regular income without being overwhelmed by the day-to-day tasks associated with managing the property. If you’re wondering how to choose the right rental property manager, you’ve come to the right place. The following tips will help you find the ideal manager that will help you maintain a profitable portfolio of rental properties.

Experience

First things first, you want to get a sense of a property manager’s experience before you hire them. Ideally, you are looking for an individual with experience managing similar types of properties. Do they manage single family homes, apartments, or commercial properties and what type of property are you intending to rent? Obviously, you want to find a good match between your property and your manager. In addition, you probably want to have an idea of how many properties a potential manager currently oversees. Not only do you want to know that your manager has adequate time to devote to your property, but also that they are active in the business.

Referrals and References

As you would likely do before hiring any professional, speak to colleagues, friends, and family about their experiences with property managers. Referrals are a great place to start when making a shortlist of potential candidates. Still, once you start meeting with property managers, also ask for references from current and/or past clients. You want to get a sense of their experience and skills from people who understand the property owner’s perspective.

Also, be prepared with a list of questions

  • How do you find tenants?
  • Describe your tenant screening process?
  • How many people are on your staff?
  • How do you handle building maintenance? Do you have in-house staff or is maintenance contracted?
  • Are your maintenance staff/contractors properly insured?
  • What are your fees?
  • How will you add value to my operation?
  • Sign a Contract

Finally, once you have chosen a property manager that meets your needs and budget, always be sure to sign a written agreement that includes the term and cost of management as well as the services that are included. In order to ensure effective management, you want your expectations clearly outlined in writing.

Dec 20

Fees for Professional Property Management Services

How much should one pay for professional property management services? It’s a good question. And the answer is… It depends, but hopefully it doesn’t cost not too much. At least that’s what most people would think.

There are three basic services for which most property managers charge a fee:

1. A leasing or often called a listing fee. (This is also sometimes called a procurement fee.) In any case this has to do with the tenant placement function.
2. Monthly management fee. This covers the cost of periodic interaction with the tenant (sometimes daily).
3. Annual lease renewal fee. Usually only charged when the management company is successful in negotiating a renewal at the end of the lease term.

Look at these incrementally, but also consider them collectively over a year’s time. These fees can be easily compared among competing agencies. You can be the judge of what’s reasonable. Keep in mind that such fees do vary from market to market. Be careful not to get hoodwinked into selecting the cheapest solution simply because it is less. Cut-rate management services may be just that, cut rate. The poor quality of services that you receive may explain the discount. A quality property manager can save you tons of money on the back end.

What you need to look for, and maybe even specifically contract for, is that there are no undeclared fees. Those are the ones that pop up and bite you when you least expect it. Read your management agreement carefully. Don’t get surprised!

Probably the fee that is most often hidden, or perhaps not fully disclosed, is the cost of home maintenance services arranged for by the management company. It is not uncommon for companies to add a surcharge to maintenance and repair invoices. For many property management companies this becomes a secondary or even primary source of profitability. The landlord is oftentimes completely unaware of these costs at the time they agree to work with the management company, and they may never become aware of what’s happening. Sometimes, even when such fees are disclosed, the disclosure language is so heavily couched in legalese that one would need a law degree simply to understand.

Get your prospective property manager to fully explain all aspects of the arrangement and make sure that what they say is also what’s printed in the management agreement. If the manager cannot explain everything to your satisfaction, move on to another manager that can. Don’t get caught paying for services your neither want nor need.

If you are determined to go for the least expensive service, keep these wise words of Benjamin Franklin in mind: “The bitter taste of poor quality outlasts the sweet taste of a discount.” You usually get what you pay for. Please be diligent!

Daniel R. Wilhelm
Executive Broker

The author is neither an attorney nor an accountant. Nothing written should be construed as legal advice. Conclusions conveyed are outcomes based upon practical experience and should not be depended upon to be a common outcome of other similar circumstances. Consult with a professional before making tax or legal decisions.

Dec 20

The Best Qualities of a Property Manager

The importance of property managers is not new to anyone, especially to the landlords, buyers, sellers and tenants. Real estate management is a career profession and is booming in every corner of the world. The manager works either directly for the owner of real estate properties or works for a real estate management firm. Nowadays, owning a rental property anywhere on this planet requires the assistance of property management services which are professional and efficient. Not all managers have the same competency to find you a rented house or a house to buy. Hence, you need to consider certain things before hiring a manager:. Wondering what are these? Check out here:

Reliable and ethical

Property managers need work on a code of honour while they deal with other people’s trust and money. While collecting rent, laundry machine money, maintenance charges, security deposits, etc. the managers should maintain a fiduciary relationship with the property owner. While the owner entrusts his money and property, the manager must be honest with these. The managers must perform at the highest level of integrity.

Local ordinances and state laws

There are separate land laws of every place and every country. The Government usually decides on how the real estate is to be managed. The manager needs to stay updated with the legal requirements of managing real estate so that he or she can take right decision and correct action whenever required.

Organised and detail oriented

The property manager, while collecting rent, must also ensure that the rent is paid and updated in the tenant’s account as “Received”. He should maintain financial records with details of each and every transaction. Also, it is their duty to remind the tenants about the rent increase, lease renewals, lease expirations, etc. In short, the manager must be able to multi-task based on priorities.

Technical competency

In today’s date, a property manager should have computer competency along with other technical skills like typing, driving, etc. The methods of mail merging, emailing and faxing need computer knowledge. Also, he or she should be in complete command of basics of computer usage. Only then they can efficiently handle all tasks.

Communication skills

The property managers must have good communication skills as they have to deal with people coming from all walks of life and all corners of the world. Hence, the managers must be able to document their cases in front of judges, negotiate with vendors, and talk to owners and tenants even when they are in bad state of mood. They should always deal with their clients in professional manner.

Flexible mind

The managers must have a flexible mind as this is a volatile profession. They should have ability to accept changes of law and have positive and unbiased attitude, obey fair housing laws, etc. They should not mistreat tenants.

Hence, hire the one who will completely understand the priorities and interests of the homeowners, landlords or home sellers. Make sure you hire a professional who had all these competencies and abilities.

Dec 20

Is It Better To Sell Your House To A Property Manager?

Property agents are what many people know and they help you with the selling process by handling interested buyers and handling the transactions all the way to closing after which you get your money for the sold property. In some cases this is a process that can take long because it means waiting until a buyer who is interested enough and likes what he sees comes along and is willing to go all the way. Depending on the location of the house and its current condition and other factors, it can take a considerable length of time to sell even though you eventually will sell.

Fortunately, apart from the property agents that can help you sell, there are property companies and managers that actually offer to buy the property directly from you easing up the process for you. Usually the condition of your home is not a factor because they buy it as it is and within a very short period of time so you can get your money fast and easy. This type of managers and property companies are becoming very popular and you might be wondering why it is better to sell your home to them. Here are some of the reasons why they might be the best path for you to take.

1. The property buyers close the deal as soon as you reach an agreement on the value of the house. This means if you do not have the luxury of time to wait until you find a willing buyer, you can still sell and go ahead with the other plans you have. They are the ultimate solution when you need money urgently or need to sell and relocate immediately.

2. They managers do not have any restrictions when it comes to the condition or location of the house. They simply value it according to the current state and give you the amount it really is worth without you having to make any renovations or repairs. They handle other property issues after the property is under them. This is nothing compared to individual buyers that want everything to be in top shape before they agree to buy the house, meaning you would need to do repairs and make all necessary changes within the property for sale.

3. The managers offer faster transactions. They are experienced in what they do and will therefore make the process as quick and easy as possible for you. You do not have to worry about long closing processes you might not have time for. Some are so good that they can do the survey, valuation and close the deal within a day and you will have your money to continue with any plans you have.

4. They offer very discreet services. Selling your home is sometimes not very pleasant, especially when you are forced by circumstances that are not very good to do so. The best thing about selling to the property managers is that the process remains short, discreet and very private to protect your interests.

Dec 20

How to Get Into the Field of Property Management

Property management is an exciting job that allows you to interact with people. By managing the site, you are responsible for taking payments, writing up lease agreements, hiring maintenance workers, and fielding problems from tenants. For someone who enjoys the day-to-day interaction with people and real estate, it is a good direction to go. So, how do you get into the field?

Education

While there are not many colleges that offer a bachelor’s degree specifically in property management, you can take other routes. By getting a degree in accounting, public administration, or business administration, you will have a head start on what you need to know. Earning your real estate license in the process gives you valuable information that will help you in your career.

No matter which path you take to earn your degree, there are a few classes you need to take, including courses that cover real estate law, leasing laws, and financial management. You should complete courses in bookkeeping, too. A certificate course that covers multi-tenant housing and government-assisted housing is also beneficial.

Licensing and Certification

In some areas, to be part of a successful property management team, you may need a license or certification. This requirement varies by state, so you should check with your state’s real estate board for specific requirements. If you are required to have a certificate or license, you will have to renew it on a regular basis, and you must complete a certain number of training courses each year to maintain that certification.

Even if your state does not require a license to work in this field, you should consider getting a certification. By going through the certification program, you can show potential employers that you have the knowledge needed to perform the job to their high standards. Prior to exams, however, most programs do require you to have some work experience as a leasing agent or assistant manager. Check with the National Apartment Association or Certified Apartment Manager sites to learn the exact requirements.

Career Experience

Once you get your education, you are ready to enter the field of property management. Of course, you need some experience in order to run your own office. You can start by working as a leasing agent for a firm to help gain necessary skills. Smaller groups may even allow you to take a job as an assistant property manager. This allows you to shadow the current manager and learn the necessary skills needed to run your own office in the future. No matter the size of the leasing agency, you need to prove that you understand maintenance and financial management before you will be allowed to be in charge of your own area.

It takes time to gain the level of education and experience in order to run your own property management office. However, by keeping yourself abreast of the changing real estate regulations and having a firm understanding of financial and business management, you can succeed.

Dec 20

Reasons for Hiring a Property Manager

The dreaded phone call comes in that your tenant has a clogged toilet at 8pm at night. What now? So you scurry over to your rental property to determine if you can fix it. You check it out, maybe even try to plunge it. Nothing happens, still a slow drain and a gurgling noise. At this point you have wasted over an hour of your time, time that you should be spending elsewhere.

You shrug your shoulders and tell your tenant you will call a plumber as they will need to snake the drain. Giving your tenant the benefit of the doubt that there are likely roots in the main line which is causing the gurgling. You finally get a hold of a plumber that will be there sometime tomorrow between the hours of 1 and 4 pm… and you need to be there to authorize work. Ugh! Now what?

So you take the afternoon off of work and wait for the 30 minute courtesy call that they are on their way. You get the call! You head over to the rental property and meet the plumber, the tenant says that the slow drain and the gurgling is still happening. The plumber looks for the clean-out, but can’t find it and you aren’t sure where it is. So the plumber goes to the roof with his snake. 30 minutes later he comes down with a child’s small toy that had been flushed down the toilet. OK, not great, but at least it’s fixed for a couple of hundred dollars and not tree roots. The plumber goes back inside to test the toilet and comes back out with bad news… still won’t flush!

So now the plumber says, do you want me to pull the toilet? That’s another charge. You shrug your shoulders and say yes, because what else are you going to do. The plumber takes his snake inside and pulls the toilet. He starts his snake and out comes a headless child’s doll covered in toilet paper from about 1 foot down the pipe.

Now the plumber comes back out and says, here is what I found. Since the toilet is off do you want me to camera the drain in the case there are more items down there. Of course you say yes, cause if he puts the toilet back then has to come back to do it that is another charge.

Plumber comes back out and says the camera showed nothing else is in the drain. You sigh and he fills out his paperwork along with charges of around $300-400. He puts in his report the issues and the apparent abuse caused by the tenant. You ask him to put as much detail in the report as possible so that you can charge back to the tenant, and he obliges and says good luck with that.

At this point you are into this little project for over 4 hours of your time, half a day off work spent standing outside of your rental, and a few hundred dollars because your tenant’s child decided they didn’t want their toys anymore.

And people say Property Management is to expensive.

Granted you still probably would have paid the plumber, but at a discounted rate. The soft costs are your time, energy, paid time off, and the stress of the situation.

Dec 20

Property Management Made Simple

A fast, simple and effective way for landlords to manage their property portfolio with minimum hassle.

Being a landlord or a property manager can be an arduous task. There is usually an endless list of jobs that need to be taken care of, whether you’re managing a single property or a vast portfolio. There are several landlord property care apps offered by property management groups to help property owners in managing their property and keep everything running smoothly, taking the stress out of daily tasks.

WHY DO I NEED AN APP FOR THIS?

Downloading the app provides a simple and efficient way for you to manage your properties. It’s intelligently designed, easy to use features have been developed by the experts in app development to cater for your specific requirements. With its key features you can digitally take control of all tasks with a swipe of your finger.

KEY FEATURES:

  • Managing Tenants
  • Monthly rental payments
  • Utility management
  • Rent review
  • Property inspection reports
  • Annual safety tests
  • Lease management
  • Print yearly/ monthly taxable finances.

MANAGING TENANTS AND RENT

When it comes to managing rent owed and tenants the app couldn’t make it simpler if it tried! You go to the sub section you need, click the icon and straight away you can add new tenants, storing their personal information i.e. phone number and address, as well as their moving date and contract end. As for rent you merely need to select the property in your portfolio, specify the date, rental fee and Estate agents commission and you’re sorted. This saves a lot of time and productivity in the long run, meaning you’re not chasing any overdue payments or tenant details.

TAX MADE SIMPLE

Everyone knows that trying to keep on top of yearly tax returns can be a nightmare, but this is just another reason why this app is extremely beneficial. It allows you to do your own book-keeping on the move, by logging all of your income and expenses, when and where you necessary, to keep on top of your accounts. In the long run this will be more beneficial for your accountant or even for yourself if you organise your own accounting. Moving forward, this means you can review monthly and yearly reports with the tap of one finger, as well as track your taxes making your End of Year returns report easy to access, and print off for your benefits.

The same format is used when logging Expenses, again these are all kept in one place, and you can easily input property expenses through their individual property details and log important expenses such as Interest only mortgage, Capital Mortgage, Repairs, Insurance, Cleaning, agents involved etc.

ADDITIONAL SUPPORT

An additional benefit is that you will have a dedicated support team which promises to assist you with any technical and non-technical help that you may require. This gives you reassurance and trust that your portfolio details are in the right hands, and that all information is deemed confidential, to which you will only have access to, and none of which will be shared to other Property Managers.

Dec 20

8 Tips for Tenant Improvements

The best type of tenant improvements are those that not only make the place look better and the tenants happier, but those that improve your revenue thus increasing your ROI. These improvements can take on many faces and investments of time, but in the long run if things are made better, then they are truly worth your time and money.

But, are there ways to make tenant improvements fulfill both of these needs? Absolutely! In fact, here are several tips that can make the road of property improvement easier.

1. Do your own homework. Take the time to determine what changes need to be made and what the priority is for each. Talk to those who will be affected and learn when would be the best timeline.

2. Stay involved with the planning process. Be sure you understand the blueprints and design plans so that you can fully understand what changes will be made.

3. Be sure that lease agreement ensures that all the parties involved get the best deal possible. Take time to study the lease agreement to ensure that your proposed improvements are a fair deal and that it provides the rent that works for you and the tenant allowance is realistic.

4. Walk through the space with your contractor and be sure that the scope of the work and all the details are understood prior to signing anything. Anytime changes are made after the papers are signed, it will cost you time, and quite often more money!

5. Be flexible. As you do the walkthrough, be open to ideas and alternatives in materials or use of the spaces.

6. Think about the present as well as the future in regards to your lease. If you are considering a long list of tenant improvements, it may be possible to space them out over several years, thus making it possible to recoup some of your investment sooner rather than later.

7. If you are new to the tenant improvement process, be sure that you understand the zoning regulations and that the contractor you work with knows you expect them followed.

8. Be upfront about your budget. If your contractor understands that adding on a multitude of extras is not going to happen due to budgetary restraints, they will be less likely to push you towards something that is not achievable.

Tenant improvements do not have to be the things that nightmares are made of! Due diligence and patience will go a long way towards making the process simpler. Talk to your local contractors to learn more about to make this process easier and more efficient.

Dec 20

Real Estate – A Great Career Option for Women

Real Estate was believed to be a tough, demanding job that can be handled by males which require hunting down houses for sale, connecting with clients and customers, etc. but in last few years, the statistics have proved that women have grown tougher and dominating this field.

You would be surprised to see a young, high school female graduate working as a real estate agent because of its extensive career opportunities which make it a great option for women as they can work independently and earn cash without many hassles.

But one needs to understand that every job has it’s demands and requirements that’s need to be filled or else there will be an imminent failure.

Unlike, the office job where you are hired and trained for a position as you have to attend your boss and his demands.

Real estate has it’s risks too as this is one career which is to be shouldered independently with no initial training, so one needs to be ready for what is to come and how to deal with it, yet it makes you your boss with no one to answer to.

So what makes Real Estate, a great career option for women? Here are few points that will get you reconsider if this is the option you were looking for:

• Freedom and flexibility:-

Women are believed to perform outstandingly when they are granted liberty and this career grants you that opportunity. Being women you have to balance family and career all along and if any job provides you with flexibility and freedom along with real cash, what else do you want as it’s a granted wish for every woman.

• Being independent:-

It’s such a big relief when you don’t have to rush in every morning and present an excuse for your blunders as you are your boss and independent working and earning according to your efforts and investments.

• Technology:-

Nowadays we are living in a tech-savvy world where you can post your ads asking your customers to get in touch if they are looking for some real real estate is the easiest way to reach them. Good response and connecting socially will also succeed you making it one of the best careers for women.

• Good service to clients and customers:-

Leaving an impression on client and customers will be a huge benefit to your career which comes naturally to most women as this will encourage them to deal with you again and even refer you to someone else.

• Growth:-

You may start as a real estate agent, but soon you will realize that you may need more staff or an assistant. Real estate is a field where income depends on a number of efforts invested and if you need an extra effort then don’t think about growing your real estate agency and adding people as this will lead you to more income.