Decisions. Decisions. Decisions.

As a property owner, you are continuously presented with maintenance issues.   Some issues are small like cabinet doors that don't close right,  and other issues are big like roof replacement.   For some property owners, roof replacement is the least of their worries, but I am not going to go there...

The decision making process for property managers (homeowners, investors, landlords, managers, etc) can be simplified by answering several questions:

1. Is the issue at hand urgent and necessary to maintain safety and/or preserve the investment?
2. How long do I have to solve the issue and what are the implications of delaying a solution?
3. Budget?  If the issue is not budgeted for, you will need to find the $$$...

The first question is the first for a reason.  As an owner of real estate you have made an investment and it is in your best interest to preserve and protect that investment.  In addition, you have a responsibility to keep your property safe whether for your family, your tenants, guests or anyone else...

The second question has as much to do with saving money as it does with protecting the users of the property and maintaining your investment.  It doesn't matter if you live in a bungalow, a 5000 SF home on the ocean or are managing an apartment building- all property owners want to minimize their cost of maintenance and capital expenditures.  If you have the time and delaying the solution will not cause a hardship, you can start with the most convenient solutions. 

EXAMPLE: My company manages many different types of property.  We recently had a bathroom tub stop draining, an issue that was reported by the tenant.  The issue at hand was important, but not urgent (the solution could be implemented over a few hours). We sent a member of our maintenance team to troubleshoot.  He spent 3 hours and $35 in materials, and was unsuccessful in freeing the drain.  In the end we had to call a drain opening company, who solved the problem in 2 minutes...  Now, 9 out of 10 times our guy is successful and when he is the property owner saves money.  In the above example, we would have saved money had we just called the specialist first, but we don't have the luxury of hind site so we play the odds.

 If the above example had been different... Instead of a tub drain, it could have been a sewer drain that was backing up into a finished basement...  That solution would have been urgent and the we would have called the specialist immediately.

The third question is where I find most people start.   My point in starting with questions 1 and 2 is that you don't always have the luxury of proactively planning your maintenance.   In most cases there are three options that you can look at:  1) The Nickle, 2) The Dime, and 3) The Quarter Solutions.  Your answer to question #3 will be based on a number of factors, the least of which may be budget.  

My advice to you is to find a way to implement the most appropriate solution for your investment.

Just When You Think You Have Seen It All...

One of the many hats that I wear affords me the unfortunate title of property manager at a low class mobile home park...   I am however, fortunate to have an onsite manger who is smart (not overly encumbered by education, but very smart...).  She is also tough as nails.

Last week she was collecting rent.  One of the tenants came up $5 bucks short.  After a little pushing  the tenant closed the door, rustled around a little inside the mobile home and then returned to the door.  She handed the manager 4 quarters and two scratch tickets worth $2.00 each! 

If you can top that!..

I would love to hear your rent collection stories...

Real Estate: Asset or Liability?

With voting season approaching, it is an opportune time to consider the political principles (and the candidates that embody them) that protect the rights of property owners. Whether you find politics interesting or a nuisance if you are a citizen they should concern you and if you a property owner, it does effect you. For example, a single piece of legislation can turn your property from an "asset" into a "liability". If that happened what would you do?  What if you still had a mortgage to pay? One thing for sure- you will always have property taxes to pay... 

Generally speaking, the candidates who will support the rights of property owners will:
1. Fight for lower state spending, leading to balanced budgets and lower taxes.
2. Reject legislation that places more regulations and restrictions on the real estate industry.
3. Defend against new taxes that might hurt our business, e.g. capital gains tax, increased transfer tax, LLC Taxes, etc.

If you are a voter in New Hampshire, there is a website with candidate endorsements that embody these elements.  These endorsements are based on actual voting records for incumbents and survey responses from challengers.  The New Hampshire Liberty Alliance, chaired by Mark Warden, is dedicated to promoting Liberty in the State of New Hampshire.

Leasing an apartment is like dating

It is a numbers game... And it is not easy to find a match.   There is always an interested “other” party, but do you want to settle?  If you settle, how long will the relationship last?  Will your property and assets suffer damage if you choose unwisely?  Will you end up with a long term headache?  Will you get lucky???

Depending on your goals, chances are that you know what you are looking for.  When you are young and inexperienced, you may just be trying to get lucky…  When you are older, but not necessarily wiser, you may just want to avoid headaches…  Regardless of where you are in your investing career, the wise landlord does not settle and does not compromise their gut. 

If you are like me, you are finding today’s rental market a bit soft.  Prospects are making the usual inquiries, and often times they like what they see, but that is when business-as-usual comes to a screeching halt-  

“I like your unit, but I have 12 more to look at.  I will get back to you.”

We are in the business of renting apartments, not just showing apartments.  So when this happens, what do you do?  Renovate?  Clean? Lower the rent?  Include heat or other amenities?  Change or otherwise improve your advertising?   The answer is yes.  Do it all, but do not compromise your tenant screening.   A wise landlord once told me that every time I compromise my gut in the selection of a tenant, that it would come back to bite me.  He was right.  Only twice have I done it, and while I have been involved in many evictions, only twice have I evicted tenants that I screened.

In order to be successful in a soft rental market, you need to maximize your numbers.  How many inquiries are you fielding per day?  Are you available to show your unit when the prospects want to see it?  Are you overlooking good prospects, by pre-screening too strictly?  The next time that you have a unit to rent, remember that renting an apartment is like dating- in order to get lucky you have to meet many different players.

The First of the Month is Not a Suggestion.

I am a landlord.   As a landlord I count on the rents received from my rental properties to pay for the plethora of expenses associated with operating my rental properties.  If you are like me, very, very little of that rent is profit- at least these days

So… Last Friday was the 9^th of the month and I had the not so pleasurable responsibility of delivering several Demand for Rent notices to my tenants.   Would you believe that one of them actually got mad.   She marched down to my office, with her rent by the way, and actually had the audacity to reprimand one of the agents in my office (I also operate a real estate services company, where we broker and manage property for clients).  My associate is an experienced landlord and handled the situation well... 

 

Is their a politically correct way to inform the tenant that “The first of the month is not a suggestion”?

  

I guess we’ll see if the message was delivered next month