Types of Services You Should Receive from Your Property Management Company

When you hire a real estate property management company, you have certain expectations – or at least you should have – of what you want and need from them. These companies are meant to make life easier for property owners like you, by professionally caring for your property or properties, and the associated people – your tenants. A good residential property management company does this by providing services to make life run smoothly for the tenants, and maintaining and repairing the properties those tenants call home. In effect, caring for your investments.

                       

Here are the basic services you should or can receive from your property management company:

Evaluation of Property/Unit & Rent Determination: documenting the inside and outside (if applicable); offering suggestions on repairs and improvements; investigating local rental rates to determine appropriate rent; discussion about policies on smoking, damage deposit for large pets,

Marketing Your Property/Unit: repairing, painting and refreshing the interior, having it professionally cleaned; landscaping to bolster curb appeal; creating enticing, informative advertising; screening calls and emails for prospective tenants; arranging showings; supplying appropriate rental applications

Tenant Screening/Selection: verifying identity, income, credit history, rental history, reference checks, and care of past property

Tenant Acceptance: drawing up & signing the lease; collecting first and last month’s rent, as well as a damage or pet deposit if required; ensuring tenant has apartment insurance; walk- though of unit with pictures to verify the move-in condition of the property; reviewing rules and guidelines or giving tenant a copy of them; scheduling the move (especially if elevators are involved)

Collection of Rent: receiving rent at beginning of each month; following up on late payments (enforcing late fees); delivering pay or quit notices; processing rent received; sending reports to owners

Financial Services: payments on behalf of owner (insurance, mortgage, etc.); documentation of expenses (invoices & receipts); maintenance of historical records (paid invoices, leases, inspection reports, warranties, etc.); annual reporting; monthly cash-flow statements with breakdown of income and itemized expenses

Repairs & Maintenance: dealing promptly with repairs 24/7 to prevent small problems from becoming bigger and more expensive ones; consulting owner for major repairs/replacements; maintaining a network of licensed, bonded and insured contractors to provide affordable work to code; apartment painting, lawn cutting, leaf removal, landscaping, snow removal, salting, trash removal

Periodic Inspections: once or twice a year; evaluate how tenants are caring for property; putting a stop to unsafe or inappropriate use of property; noting and stopping code violations, lease violations; reports sent to owner

Legal Situations: knowledge of local, provincial, federal laws and legislation applicable to rental properties; advising in litigation or legal disputes; having name of qualified lawyer

Evictions/Collections: knowledge of local Landlord and Tenant rules; filing necessary paperwork; representing owner in court proceedings; working with law enforcement to remove tenant(s) from premises

As you can see, there’s a lot involved in properly managing an investment property – and these are just the basics! Only the best real estate property management companies go the whole nine yards to make sure you get the most out of your properties – and that includes prompt and consistent communication as well as accountability.

Before hiring a company, get recommendations from real estate agencies or mortgage lenders at banks, go and personally look over some of the properties a company manages, check on-line for comments from current and previous tenants. If you do choose a residential property management company that’s not working up to the standards you expect, don’t waste any time finding a better one. Remember, it’s your investment at stake!

The Top 5 Problems Landowners Experience

There are five main problems that landowners have to deal with when they rent or lease their property or properties. These are problems that can be easily solved with the right real estate property management company. However, some people try to save money by handling these challenges themselves, and end up wasting valuable resources and burning themselves out in the process. If you see yourself struggling with some of these issues, this might be a good time to take a step back and reconsider your choices when it comes to property management.

TIME - You only have so much time in a day. If you’ve invested in property and still have a full-time job, you don’t have a lot of time left over - especially if you have a family - to give your property the attention it needs. Even if you are retired or semi-retired, there’s a lot of work to do when it comes to the day to day issues of renting and maintenance. It’s a 24/7 commitment. Your time is better spend arranging financing for necessary renovations or looking for new investment opportunities.

DISTANCE – If you don’t live near your rental property, checking on it and even interviewing potential tenants takes a lot of time and effort. Now add in dealing with tenant complaints, maintenance issues, emergencies, even just collecting the rent on time. If you manage your own property or properties, you’d need to live close by to be efficient and time effective. And the best investments may not be right around the corner. This limitation can affect your long-term success.

INEXPERIENCE – If you don’t know anything about residential property management, you’re in for a series of nasty surprises. There is so much involved that you’ll be overwhelmed just finding out all you have to do. And you not only have to do it, you need to do it quickly, correctly, and legally. Hire a bad or lazy repair person, or take too long filling vacancies and watch your profits melt away. Legal errors will cost you if you don’t understand the housing laws, or if you take too long to fix a furnace in the middle of winter.

MANAGEMENT – There is much more to it than you realized, most of it dealing with people: tenants, repair people, accountants, maintenance people, and lawyers to name a few. Along with collecting rent, maintaining the property to code, and dealing with complaints and problems, there is payroll and a pile of legal requirements and considerations. Basically, you’re an employer with all the accompanying headaches. And I’ll bet that’s not what you signed on for when you invested.

TENANTS – Finding and keeping good tenants isn’t easy. A vacancy is money slipping through your fingers. You need to create enticing ads with good pictures to attract the kind of tenants you want. You must respond to emails, interview people, show the unit, review applications, pull and review credit reports, call references and past landlords, prepare a lease negotiate the terms, get the lease signed…and this is still no guarantee of getting a good tenant – especially if you’re not experienced with renting. Good tenants need a quick follow-up for repair needs. Bad tenants cost you time and money and a few rounds with the legal system to get rid of them! Until they’re gone, one bad tenant can cost you many good tenants, and a lot of money.

The answer to all of these problems is simple. Hire a good residential property management company. They will handle every management issue from renting to maintenance…from emergencies – they get the 2am call that a pipe has burst – to evicting the nightmare tenant. They know the ins and outs of vetting and keeping tenants, all the legalities involved in any situation, and have the best repair people on call. They will lift the weight of property management from your shoulders, and let you relax and watch your investment grow. If you haven’t before, now might be the time to look into finding a good real estate property management company. 

Residential Investment Tips for First Time Buyers

Hundreds of thousands of people across North America are happily living off money made from investment properties. If you do it correctly you can join them. But it’s much more complicated than just buying a building. There’s a lot you need to know and do before you take the plunge. You also need to understand a bit about the dark side of residential property management – but we’ll point out a great way to handle that!

Don’t rush into it. You need to go into property investment with your eyes open – knowing what the potential gains and risks are. That means doing research, as well as getting advice and help from professional property experts. Do your research in person as well as on the internet. Talk to anyone you know who owns investment property. Sit down with them to get a first-hand look at what it really entails, the good, the bad, and the ugly. As for those property experts, they should include an independent mortgage broker, and a real estate agent with investment experience.

You’re not buying a property, you’re buying a business. And this isn’t always the easiest paradigm shift to handle. It’s not simply a case of sitting back and watching the money roll in. You have responsibilities to shoulder and legal aspects to understand. You need to factor in municipal rates, interest rates, and operating costs like property insurance and taxes. A good way to handle this is to draw up a business plan with all the details you should consider, and set realistic goals. Are you willing to handle the day to day details of an investment property? If not, hire a good residential property management company. It’ll save you money - and headaches - in the long run.

Look for an ‘income stream’ instead of capital growth. Before you buy, you need to work out – and understand – the ‘yield’ of a property. Yield is the actual income you expect to receive – the rental income relative to the property’s value. To figure out the yield: total up all property costs (include closing fees, renovation fees, etc.). Take the estimated annual rent amount and divide it by the cost of the property. Multiply this by one hundred for a percentage – and this is your net rental yield. Balance this annual ‘yield’ against the price your property could be sold for in the next five to 10 years. Now you can see if the property is worth investing in.

Buy Where Renters Want to Live. You may get a great deal for a property in a small town, or in what appears to be a good area – but if it turns out no-one wants to live there, you’re in trouble. When scouting around for a rental property, look for areas of a city that show signs of growth and economic sustainability. Find out which areas have jobs available and people moving there for those jobs. Is there a school nearby, is transit handy? If you’re not familiar enough with all the different parts of your city, hire a real estate agent who’s experienced with investment needs.

Understand Your Monthly Costs. There are more than you may have realized when you first decided to buy an investment property. Those costs include: mortgage payments, interest and property taxes, maintenance costs, possibly garbage pick-up, water usage, or strata fees. You should also have an emergency fund to take care of unexpected repairs or vacancies. Those monthly costs may also include a property manager to handle the business end of things.

A Property Manager is Your Best Friend. Good property managers are worth their weight in gold! They’ll deal with the many day-to-day details of running your property and handle the dark side of rentals - like the call in the wee hours of the morning when a water pipe breaks, and dealing with the ‘tenant from hell’ who just doesn’t get it! – all for a small monthly fee. They’re proven to generate higher rent incomes, have connections in enough industries to handle any situation, and understand the applicable legalities. Shop around when it comes to choosing your real estate property management. And ask around. People are more than happy to recommend a good property manager.

If you’re considering buying an investment property, and hadn’t really looked into it too much, your head might be spinning right now! But if you are serious about this, you can now move forward in the right way, with the right people, to make this dream a successful reality.

Ideas for Landlords on How To Keep Good Tenants

Retaining good tenants is a key part in successful residential property management! The only thing better than a good tenant, is a good tenant who’s there for the long term! In some ways, keeping good tenants can be harder than finding those tenants in the first place. As any good property manager and landlord knows, having good, long term tenants is not only important for regular rental income, but it also cuts back on your time and paperwork.

There are many different things you can do to keep these people. Here are a few tried and true suggestions for you to consider:

Go the Extra Mile.  A tenant is like a customer, so make some effort to keep them happy. Have a welcome basket waiting for new tenants to ease the stress on moving day. This starts things off on the right foot. Send a card at Christmas to thank them for being your tenant and to wish them well. It takes little effort but lets them know they’re appreciated and respected.

Be Clear on What You Expect From Tenants. Give them a list of rules and regulations that apply to living on the property in terms that apply to their wellbeing. It should include everything from parking and noise expectations, to leaving laundry in the washer or dryer and how garbage is to be dealt with. It’s easier to be a good tenant if you get some guidance.

Open Communication is critical. Never ignore calls, texts, or emails from tenants. If you can’t answer immediately, return those communications as soon as possible. If you don’t agree with their requests, talk the issue through and try to reach a compromise. When you’re around your tenants, be friendly and approachable.

Take Care of Problems Quickly. Fix that sticking window or loose tile as soon as you can. It may seem minor to you, but it’s a daily irritation to a tenant who lives with it. If it’s not something you’d fix yourself, send a contractor. If you need to order parts, or if it’ll take extra time, tell the tenants so they know their concerns are not being ignored.

Keep Your Property Maintained. Clean the hallways, stairways, and elevators regularly. Trim those hedges and cut that lawn every month. Visit the property regularly to check for any things that need fixing or repairing and take care of them – don’t wait until they’re brought to your attention. A well-maintained property is a nice place to come home to. 

Use Quality Appliances, Fixtures & Fittings. It not only gives the property a feeling of value and worth, it makes tenants feel that they’re getting their money’s worth. Using quality materials also means less repair and maintenance, so less annoyance for tenants, and less work for you. Also, if tenants feel proud of where they live, they’re bound to stay.

Get Rid of Bad Tenants. This is the dark side of residential property management. If they’re irritating to you when they don’t come up with the rent, or give you attitude, just think how much worse it is to have to live near them! If they fail to pay rent, indulge in illegal activities, constantly ignore noise restrictions, or cause damage to your property, you have every right to take action. If they don’t leave, in many cases, the good tenants will.

Consider a Tenant Retention Plan. What would you give to have a good tenant sign another lease - or after 3 years or 5 years, or even 10 years as a tenant? Consider offering things that enhance their ‘home’ space: a maid service for 2-3 hours, a professional carpet cleaning, refreshing a room by painting an accent wall in an acceptable color. Let them know that long-term tenants are valued.

Tenants who feel valued and appreciated, usually stay longer. The way to make this happen is by hiring the right property manager. A good property manager is actively involved in all aspects of a maintaining a property and a major part of that is tenant satisfaction. The most costly part for any real estate property management is constant turnover – or, heaven forbid! – empty rental units. In the long run, it takes less time, effort, and money to keep the tenants you have happy, than it would to be constantly looking for new tenants. So take a few suggestions and make some positive changes!