Property Management and Investor Information: October 2008

I am a big advocate of education.  I have many designations and have taken many property management courses over the years in order to improve with the idea of delivering better service.  I have also taken the time to teach others which is another way to learn as the instructor has to stay ahead of their students.

I have noted that some in our industry think talking a good game, smiling, and making arguments why their methods are better seem to think that pursuasion and personality is more important than skill.

I do take comfort knowing that in the long run skills keep a business afloat a lot longer than smiles.

At HomePointe we pay a portion of all property management related courses for our property managers and reward them further for obtaining designations.   We take many courses throughout the year at the local Rental Housing Association and many attend meetings at the local chapter of the National Association of Property Managers.

What do you think about this? 

www.HomePointe.com 

In California a landlord can raise the rent in any amount unless they live in rent controlled community like San Francisco, Berkeley, and some others.  Most of California does not have rent control.

If the amount of the increase is 10% or less, the notice need only be 30 days.  If the amount of the increase is more than 10%, the notice must be 60 days.  If the landlord gives more than one increase in a year, the notice would have to 60 days when the cumulated rent increase totals go over 10%.

The notice  should be served at the tenant's and a copy mailed.  This is proper service.

Most landlords give 3% increases on an annual basis when single family dwellings are the subject.  Much more and you are inviting your tenant to pack up.

I would suggest that landlords and property managers do a rent survey prior to considering a rent increase so you know what the tenant will be looking at when the increase arrives.

The greater Sacramento Region, including Sacramento, Yolo, Placer, and El Dorado Counties do  not have rent control.  

www.HomePointe.com 

Disclaimer:  I own a large company by industry standards.  (1000+ houses from three offices)

Some smaller property management companies will tell you that smaller is better.  I personally believe that each company size has it's advantages and this argument should not be part of the discussion.  Service is the issue, not how many people work there.

That said, most smaller operators would love to have more clients.  That is just human nature.  If the company stays small forever they may be very picky as to who they will work for.  That may be a good thing unless you are one of people they don't want. That small company owner may be so stuck in their ways that they are not growing and changing with the market, which could be a bad thing.  They may not be motivated to grow and improve or they just may not be very good at the business.  

Smaller operators do have challenges.  What happens when the sole proprietor gets sick, goes on vacation, gets sued (and is distracted with depositions and court appearances), gets injured, etc.  A small company with less than 200 units may be a husband and wife team.  Now the effective management of your property may depend on what happened last night.  Larger companies have departments with some cross training so that the busines of the day goes on even if someone inevitably calls in sick.  

Larger companies have their challenges too.  A less experienced manager may be working on your property. But, that person does not work alone and has the benefit of plenty of help.  The property manager may have a larger portfolio.  But, they don't have to to accounting, rent postings, maintenance intake calls, etc.  

The bottom line is getting what you want out of the company.  Do they know how to do the work at hand?  Do they seem motivated to do it?  Do they get it done at a reasonable price?  Are they known in the marketplace (do they show up in the search engines?  Do they communicate with you? Do you like the people you are working with?

HomePointe Property management in Sacramento, Roseville, Folsom, Elk Grove and more.

www.HomePointe.com 

 

 

 

 

 

 

The fact that we have three offices puts us close to more property than most all other managemet companies, especially those with only one or no offices.  What, some companies have no office?  Yes, some property managers choose to work out of their homes to the detriment of their clients.

Detriment because tenants have no where to go to pick up a vacancy list or to meet with their property manager. How is the security of your files if everything is at home?  Where are the computer backups stored?  

Some companies rent a phone line and conference table at a commercial center which can be confusing for clients.  It is just too eay for a tiny company to drop off the face of the earth.

5896 South Land Park Drive, Sacramento, CA 95822  (Serving Sacramento, Natomas, Elk Grove, & more)

1220 Melody Lane, Suite 110, Roseville, CA  95678 (Serving Roseville, Rocklin, Lincoln, Antelope, N. Highands)

8856 Greenback Lane, Orangevale, CA 95662 (Serving Folsom, El Dorado Hills, Cameron Park, Gold River & More)

www.HomePointe.com 

Once a tenant has told you that they suspect mold, a prudent owner or property manager should do a few things immediately.

First, find out if there is a water leak or water intrustion.

Second, find out how large of an area has been detected.  

Third, is there a musty smell?

Let the tenant talk and tell you all they know about the condition.

At that point you need to make a determination as to whether to hire a regular handyperson or a company with experience in mold remeditation.  The larger the area affected the more likey you will want to hire the remediation company.  Normally, an affected area of less than 10 square feet can be handled by a handyperson that knows how to clean mold.  Larger areas should be worked on by someone with some mold remediation training.  

Mold needs moisture, something to eat, and heat.  Take away the moisture and the mold problem will go away. But, you should clean up any mold or old mold.  

If you are a landlord or property manager, there is lots more to know about mold and mold remediation.  So take a class or at least google "mold remediation" and read all you can.

www.HomePointe.com 

Property Management in Sacramento, Roseville, Folsom, Natomas, Elk Grove, West Sacramento, and more.

I have noted that some banks are now contacting property managers about fixing up and renting some of their Real Estate Owned (REO) property.  I had previously thought that banks could not do this but I am finding out that it may have been that they did not want to do it, but could.

Real Estate values in Sacramento have taken such a beating that it is no wonder banks are wanting to hold off selling for the time being.  By renting out their holdings they can get a return on their investment, better preserve the asset, and sell in a few years.

HomePointe is happy to have banks as clients and will provide the services necessary to make their new business plan a success.

www.HomePointe.com 

Housing Now's Independant Living Assistance Program (ILAP) Emergency Utility & Rent Help Housing Now was awarded a Community Service Block Grant (CSBG) from the Sacramento Employment and Training Agency (SETA) in January 2008. This funding is being distributed from Jan.'08-Dec.'08, (while funds last,) to people with developmental disabilities, living in Sacramento County who can demonstrate emergency need of financial assistance to avoid eviction, avoid utility disconnection, have utilities reconnected, or are in need of an emergency motel voucher for temporary shelter.

Applicants must provide identification and proof of emergency need; i.e. eviction notice, utility disconnection notice, or other documents that will demonstrate/verify emergency situation. Upon verification of need, qualified applicants will receive assistance for the minimum amount necessary to avoid utility disconnection or eviction, to restore utility service, or a voucher for a designated amount of time at a motel.

Payments will be made directly to the agency, landlord, or utility that is demanding payment, or to the motel where voucher is given. Persons receiving assistance from Housing Now will be asked to enroll with a payee service to help avoid future financial emergencies.

To apply for assistance, call Housing Now at 916-549-1044 or send an email to Patti@HousingNowResource.org. PLEASE NOTE! The ILAP is currently available for developmentally disabled residents of SACRAMENTO COUNTY ONLY, but Housing Now is working on grants to expand help to other counties served by the ALTA CA Regional Center. 

Our 4th Quarter Residential Rental Survey is now available for Houses for Rent, Duplexes for Rent, Apartments for Rent in the greater Sacramento area. You can also access this survey at our website along with past surveys by clicking this link: http://www.homepointe.com/owner_services_rental_survey.asp. Is the sky falling or what? Last I looked at my own haunts, I noted that restaurants are still busy on weekends, but I can now walk in instead of needing a reservation. I still see that the malls are busy, but some stores are no longer there. Gasoline is coming down, and that is welcome relief. I just saw my 401k and noted that my accounts have taken a hit. Luckily I got out of the stock market earlier this year and have bought some REO’s. With 6-10% cash on cash return I sleep better. As for rentals, we are getting inquires from investors looking to buy houses for cash like I have done. That seems to be where the action is. How long will this last? I am hearing maybe 5 years! Rents are holding steady and houses and apartments are renting. That market is a bright spot. Tell your investors! Remember, we don’t sell, just manage and maintain. www.HomePointe.com

Of course, this came up during the interview of Governor Palin with Kati Couric. 

I read the Wall Street Journal, the Sacramento Bee, Newsweek, the Business Journal, several trade publications including the Journal of Property Management, The Residential Resource, The Regional Housing Association Magazine, and a some others.  I also read a few fiction books every month or so and love to read about historical events.  I really liked 1776 and the Path Between the Seas (the history of the building of the Panama Canal).

So, what do you read?