Tips for New Rental Property Owners – Part 1

Tips for New Rental Property Owners – Part 1

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Tips for New Rental Property Owners – Part 1

 

Becoming a landlord for the first time can be a very stressful situation. Finding a qualified tenant is probably the first thing on your mind, but it is also very important that you are complying with all the important rules and regulations that go along with rental properties.

 

So what are the most important aspects of being a landlord? Below are some tips that will give you a basic understanding of owning a rental property and what you should focus on to be the best landlord possible:

 

  • Screen Potential Tenants – In order to find the best tenant for your rental, you will have to do a little bit of research. Anytime a potential tenant fills out an application, you should run background and credit checks. It is also very important to contact all references you are provided with. This will give you a great idea of how likely the tenant will be to pay you on time each month.
  • Have a Contact List of Maintenance Partners Ready – It is always a good idea to be proactive and create the relationships with your maintenance partners before any issues arise. This way, if it is 2am and you receive a phone call that your property is flooding due to a broken pipe, you know exactly who to call. This can help to limit the damage you experience before it is too late.
  • Know the Market Rate For Your Property Although you may think that your property is near flawless, you have to look at the situation from a potential tenant(s) perspective. What are the weaknesses of the property? Does it have a good layout? Is the home located in a good location? It is always a good idea to look at other similar homes for rent that are currently on the market. This will help to give you an idea of what your property will actually rent for.
  • Customize Leases – It is very easy to find a generic lease online that you can have your tenants sign. While this will cover you on many of the basics like rent, security deposits, and tenant rights, it may not cover the more in depth issues that you would like to outline (like your pet policy, how you handle late fees, and what maintenance the tenant will be responsible for). If you are not currently
    customizing your leases, you may want to consider starting this practice.
  • Create a Property Inspection Report – By getting a property condition report signed by the tenant at move-in, you can decrease the chances of a dispute when the tenant moves-out. This will help to eliminate the excuse of “that problem was already there when I moved in” from your tenant, as it will show all of the issues the property had before the tenant moved in.

 

Being a rental property owner can be very rewarding, but also very stressful. If you would like to discuss the best way to manage your rental or if you are considering hiring a property management company, please contact us at FRE Property Management. We are the premier property management company in Utah and will provide you with the peace of mind knowing that your investment is being taken care of. Contact us today at 801-673-5692.

 

Layered Window Treatments are Energy Efficient

Layered Window Treatments are Energy Efficient

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In this colder season, you may be looking to your windows to help keep your home cozy and warm, shutting out biting winds and inclement weather. It’s no secret that expanses of glass absorb the outside temperature and transfer it inside, so how can you make your windows work the best for you? Follow these simple steps!

  • First, check all your windows to be sure the weather stripping is in good shape. Overtime, weather stripping can dry out and develop cracks, allowing air leaks. These drafts around windows and doors will make your heating and cooling systems have to work harder.
  • Double-paned windows are another way to reinforce your home against the effects of harsh weather and they provide the added benefit of noise reduction.
  • Consider layering your window treatments. Just as an outfit with a jacket and scarf is warmer than a shirt, multiple window coverings provide additional insulation and protection for your home and help lower your utility bills.

See how the right window treatments can help you create a style perfect for your home by combining high fashion with practical functionality. The same way you accessorize your clothes using patterns, textures and colors, layering window treatments presents endless design possibilities for updating your home.

Layering with Blinds

Window blinds are a popular choice for window coverings because they’re always in style, extremely durable, and they come in dozens of styles and colors, including wood, faux wood, vinyl, aluminum and elegant fabric blinds. Our blinds can be customized to fit any shape window or door, horizontal or vertical. All the design options of color, texture and finish make them an ideal window treatment for any room in your home.

As a stand-alone window treatment, blinds have a clean, modern look. Blinds block sunlight and harmful UV rays, have adjustable vanes for light manipulation and control privacy and they provide insulation when closed. They can also be paired with curtains and drapery panels, giving you a layering look that enhances your lifestyle by increasing insulation. Layering drapes over blinds will help keep the cold out and the warm in.

Layering Drapery Designs

Some people prefer having only fabric treatments on their windows. They’re generally easier to clean and may be more cost-effective than other treatments. Luckily, wanting all fabric doesn’t hinge your options for layering techniques. A traditionally popular style for windows and doors is full-length sheers with a heavier drape on top. The sheers create soft, filtered light with a low-level sun protection and privacy during the day. Adding an opaque drapery gives you the option of complete privacy when the drapes are closed, as well as increased insulation due to the extra layer of fabric.

Layering with Sumptuous Shades

Window shades are the most versatile window treatment around. With options like top-down/bottom-up, cordless lift and motorization, you will be provided with complete light and privacy control. Custom shades range from light-filtering to room-darkening to complete blackout. These shades include Roman shades, roller shades, pleated shades, solar shades, woven wood and bamboo shades, and cellular and honeycomb shades. Dual-fabric shades uniquely combine pleated fabric and light-filtering cells in one shade.

As with blinds, window shades can be paired with curtains or drapery for stylish home décor or improved insulation. They filter light during the day, while giving you complete privacy at night by closing the drapes. The drapes add extra insulation against the cold, and in especially cold climates, the heavier the lining, the more energy-efficient they become.

Blindspot will help you maximize your window coverings for increased energy efficiency in your home with innovative ideas and creative designs that will transform your home. Contact Blindspot today at 801-915-0906 to start redecorating your home and lowering your gas bill.

Tips for Marketing Your Vacancies on the Web

Tips for Marketing Your Vacancies on the Web

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Tips for Marketing Your Vacancies on the Web

 

Remember when finding a new tenant meant throwing up a sign in the yard and placing an ad in the weekend paper? Times were simpler then. With sites like KSL and Craigslist attracting tons of local traffic and allowing free classified ads, the web has become your go to spot for finding quality tenants for your Utah rental property. But how can you make your rental stand out in the crowd? Following these simple steps will give your property a strong web presence and help find your next tenant faster.

 

Create visibility – Telling you to publish your vacancy to as many websites as possible may sound obvious, but do you know why? The more links available to your rental, the more likely it is to show up on your prospective tenants search results and ultimately on their radar.

 

Let your photos do the talking  – Almost anyone can write a glowing description that will make even a toolshed sound luxurious, but searchers want to see it. In fact, you should add as many pictures as the site will let you. Make sure they highlight your property’s best features and watch your lighting, because dark photos can make your top floor condo look like a basement apartment.

 

Add video – Sometimes photos just don’t tell the whole story. A virtual tour can really help people visualize the space and picture themselves living in it. Another huge advantage to using video is it will limit your showings to only truly interest parties since everyone will have already had a chance to “walk through” your property.

 

Update your information regularly – One of the biggest advantages web marketing has over print is that it’s editable. If you change your price or forget to mention a particular benefit, you can easily make the change at no additional cost.

 

Make it convenient for tenants to contact you – Not everyone does their searching during daylight hours when it’s appropriate to call, so always make sure your prospective tenants can contact you by email to ask questions. In fact, if you hire a property management company, they typically offer software that will allow tenants to schedule showings or send an application right from their computer.

 

If you aren’t already marketing your vacancies on the web, I suggest you start now. Your competitors are already showing their properties off online. The web can be very competitive, but following these simple tips will help you build a web presence and decrease your vacancy rates.

 

 

 

 

How should I choose between multiple qualified applicants?

How should I choose between multiple qualified applicants?

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While many owners struggle to find qualified tenants for their property, a distinct few may be fortunate enough to have multiple applicants willing to rent their unit. While almost all owners would agree, having multiple qualified potential tenants is a good problem to have; many owners don’t know the exact protocol to follow in order to comply with the Fair Housing Act.

So you have multiple applicants willing to rent your property, what is the first step in order to determine who to rent the property to? First of all, you must create a qualification criteria and apply it equally to all potential tenants. This may be a minimum credit score and minimum income requirement that you will require from your tenants. In addition, you may require documentation of rental payment, as well as one positive reference from a past landlord. The most important aspect is creating a standard and applying this to all applicants.

What if multiple candidates exceed the minimum qualification requirements? In the event that multiple applicants exceed the criteria you have set, you will need to create a fair method to determine the tenant you choose. An example would be selecting the tenant that exceeds the qualification requirements the most. This may be the tenant with the highest credit score, longest documentation of timely rental payments, and/or the most positive references from past landlords. Another example would be selecting the first qualified tenant that was interested in the unit. While there are pros and cons to each, whichever method you choose, be sure to remain consistent and apply to all properties you rent.

Once you determine which applicant you would like to enter into a lease agreement with, be sure to provide written notice to all other applicants. This should include the reason for not renting the unit to the applicant. As long as the reason for denial is not correlated with the applicant’s status in a protected class, you should be in compliance of the Fair Housing Act. In the event it was based on information contained in the applicant’s credit report, you must state this as notice of the denial per the Fair Credit Reporting Act.

The Fair Housing Act can be very confusing and a costly mistake if an owner does not comply.  If you would like to learn more about the Fair Housing Act or if you would like assistance in managing your investment, please consider hiring FRE Property Management. We are the premier property management company in Utah and will provide the peace of mind knowing that your investment will be taken care of. Contact us today at 801-673-5692.

What Options Do I Have if My Tenant Needs to Break Their Lease?

What Options Do I Have if My Tenant Needs to Break Their Lease?

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What Options Do I Have if My Tenant Needs to Break Their Lease?

 

Some of the best property management advice you’ll ever receive is simply to plan on bad things happening. No matter how lucky you are, something will inevitably go wrong and cause you to need a backup plan.  It’s how you prepare for these contingencies that will ensure the long-term profitability of your Utah rental property.

 

One of these inevitabilities is when your “perfect tenant” needs to move out early. Unfortunately, this situation is not uncommon, and you need to protect your investment. Here is a list of options available to you:

 

1) Include a lease buy-out clause – One easy solution is to include a lease buy-out clause in your rental agreement. This clause is essentially a dollar amount you set to allow the tenant to exit their current lease with no further obligations. This figure is typically set between one and three months rent. This strategy is a bit risky though, since you are basically wagering that it will not take you very long to re-rent the property. If you end up with a prolonged vacancy however, your buy-out amount may not cover your losses in rental income.

 

2) Allow them to find a replacement tenant – This is where you allow them to find someone else to move in and take over the lease. This can be a good option, but be careful. You must provide them with your rental criteria and inform them anyone they find will be measured against it. Also, be sure to receive a signed lease and deposit from the replacement tenant before allowing your existing renter out of their lease. The upside here is your renter will do much of the work, but make sure they know you are in control.

 

3) Charge your tenant the cost of re-renting – In this option, you can simply charge your tenant the costs you incur while trying to re-rent. These include unpaid rent, marketing expenses, cleaning and labor costs, as well as any damages. However, you must actively try to re-rent your property because you are legally obligated to minimize these expenses to your former tenant.

 

Whichever option you choose is up to you, and there is no “correct” answer. Each option will have its pros and cons, but what’s important is that you have a plan. Planning ahead and remaining flexible will always help you adjust to whatever challenges may be thrown at you.

Why Investors should purchase Multi-Family Homes in Utah?

Why Investors should purchase Multi-Family Homes in Utah?

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If you asked five different investors what the best real estate investment strategy is, I am sure that you would receive 5 different answers (every one being a viable strategy). While some may prefer subdividing land or a fix and flip strategy, I prefer the buy and hold strategy, particularly with multi-family homes.

 

While multi-family home investing is not a “get rich quick” plan, I do feel like it is the best long term solution to building wealth through real estate. You may be asking, “why multi-family properties instead of single family homes?” My answer to this question is simple – risk management. Below are some of the greatest benefits that you will experience by investing in multi-family properties compared to single family homes:

 

  • The cash flow should be greater – Due to the fact that you will have multiple rents coming in for one property, your cash flow should always be greater for a multi-family property compared to a single family home.
  • Risk of vacancy – If you have a tenant that moves out of your single family home, you are receiving no monthly income and are operating at a negative cash flow until another tenant moves into your rental property. If this takes several months, you will have suffered a significant loss that will you will never be able to recoup. On the other hand, if you have one tenant move out of your multi family property, you still have income coming in for the other unit(s) while you fill the vacancy. This will still negatively impact your monthly cash flow until the vacancy is filled, but not nearly as much if you were receiving no monthly income at all.
  • Property management potential – Since your cash flow should be greater on a multi family property, you may now be able to afford a property management company to find great tenants and manage all other day to day aspects of managing your investment. This will allow you to focus your time and energy on finding other potential multi-family properties to invest in.
  • Economies of scale – If you purchased eight single family homes throughout Utah, you would need to manage eight different tenants located in different locations. You would also have the risk of eight different roofs needing to be repaired, eight different air conditioning units that would need to be managed, and eight different yards that would need to be maintained. On the other hand, with an eight-plex you would get the benefit of the eight tenants, but they would all be located at one central location when responding to maintenance issues. You would also only need to maintain one roof and one yard, thus significantly reducing your risk.

Multi family investing can be a very attractive option to an owner that would prefer to hold the property for the long term. If you would like to discuss investing in real estate or would like to have your multi-family property managed, please consider hiring FRE Property Management. We are the premier property management company in Utah and will provide you with the peace of mind knowing that your investment will be taken care of. Contact us today at 801-673-5692.

Rental Advertising Tips for your Utah Rental

Rental Advertising Tips for your Utah Rental

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Rental Advertising Tips for your Utah Rental

 

Nothing puts a landlord on edge quite like a vacant unit. With no one to pay rent and expenses piling up, most want nothing more than a phone call from a qualified prospect to put their mind at ease. Sometimes renting your property is as simple as combining well written ad copy and strong sales skills. Use these tips when marketing your vacant properties.

 

Start with the basics – Good copywriting is certainly an acquired skill, but you’d be surprised how often even basic information is missing from Utah rental property listings. Always include the rental amount, property address, and property specifics like bed/bath and square footage.

 

Highlight features and benefits – Even the least desirable unit has some benefits and it’s your job to discover and highlight these. Top floor units typically have views, ground floor units are easily accessible without stairs, and homes on a busy street are closer to bus lines and freeway entrances. Every property has something that makes it unique and attractive.

 

Provide lots of information – The more details you provide, the more a prospect knows if your unit is the right fit for them. Items you should provide include detailed photos, lease terms and deposits, application process details, etc. Being this specific may limit your total number of showings, but you’ll find that the prospects who do contact you are much more qualified.

 

Sell to your audience – When showing your vacancies, try to point out features that will be important to each individual prospect. If you are showing the home to parents with young children, point out safety features like a fenced in yard. If your prospect is a student, highlight how close the unit is to public transportation that goes by the university. By tailoring your presentation to each individual tenant, you will be much more likely to fill your vacant unit.

 

Having unoccupied rental units can be very stressful for landlords, but there are some simple things you can do to help fill them quickly. Follow these tips next time you post your vacancy and watch how quickly it gets filled.

 

How to Market my Utah Rental Property?

How to Market my Utah Rental Property?

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So you have decided that you are going to rent out your home, the next logical question you will probably ask is: How do I find a qualified tenant? There will always be quality people that are looking for a Utah rental property, but you will need to actively seek them out. Here are some tips that will help you find the right tenant and start covering your mortgage each month:

 

  • Put a Sign in the Front Yard – This might seem like the most obvious marketing tip in the world, but it always amazes me how many owners don’t do this. By putting a sign in the yard, it will not advertise to potential tenants that drive, but it will also let your neighbors know that the property is for rent. If your neighbors really like the area, they will let their friends and family know about any available properties. It really is amazing how many rentals are filled this way, and how inexpensive this advertising is.
  • Make Sure your Property can be Found Online – Oh, how the times have changed! In today’s market, more than 80% of prospective tenants begin their search online for a Utah rental property. There are so many free classified ad websites on the Internet, as well as many inexpensive sources that specifically target renters. This makes it easy to market your home to a wide range of people. If done correctly, your property may only remain vacant for a few days!
  • Tell the World About your Property – You should never be ashamed to pitch your rental property to family, friends, and related professionals. Maybe your brother has a friend that is looking for a home to rent or your friend has a co-worker that needs to lease a place. In addition to these people, your real estate agent and mortgage broker are great resources for finding interested tenants. They are constantly working with individuals that would like to purchase a home, but can’t for a variety of reasons. This word of mouth advertising does not cost you anything and can be very effective.

 

There is no shortage of things that you can do to get your Utah rental property filled with quality tenants. They do exist, but you really do have to be proactive in finding them. If you have any questions about how to market your rental home for prospective tenants or if you are considering hiring a property management company, please contact us at FRE Property Management. We are the premier property management company in Utah and will provide you with the peace of mind knowing that your investment is being taken care of. Contact us today at 801-673-5692.

Why Investment Property Owners in Utah should consider refinancing through HARP?

Why Investment Property Owners in Utah should consider refinancing through HARP?

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Why Investment Property Owners in Utah should consider refinancing through HARP?

As most lenders continue to tighten mortgage requirements for investment properties, it has made it impossible for many owners to take advantage of historically low interest rates. As an investor myself, it pained me to continue to pay the mortgage on my rental property each month at a 6.5% interest rate knowing that interest rates were currently  being offered for 4%. I don’t know any investor that couldn’t benefit from the increased cash flow by reducing the interest rate on his/her property by 1.5%. I continually tried to refinance, but due to the fact that I had purchased this property in 2007 and was underwater, no lender would even entertain refinancing my mortgage.  Lucky for me a colleague of mine mentioned the possibility of refinancing through HARP.

As a property owner in Utah, you may be eligible for HARP, or the Home Affordable Refinance Plan. This was enacted in 2009 by the US government in order to allow home owners to refinance his/her rate in order to continue paying the mortgage each month and avoiding foreclosure. This was the perfect option for me, as it does not require the home to be owner-occupied and does not require an appraisal. Earlier this month, I was able to refinance my rental property from a 6.5% interest rate to 4% with closing costs totaling $500. In turn, the cash flow on my rental property went from break-even each month to $250 positive cash flow.

So what is required to qualify for HARP? First of all, your current loan must be backed by either Fannie Mae or Freddie Mac. Second of all, your current mortgage must have a securitization date prior to June 1, 2009. If these two criteria are met, you may be eligible to refinance your current mortgage through the HARP plan. Unfortunately, if your current mortgage is FHA or a jumbo loan, you will not be eligible for HARP.

So I am eligible for HAP, what do I do now? The first thing I would do is reach out to your current mortgage servicer and inquire as to the interest rate you would be eligible for with this program and the procedure to initiating this refinance. I would also reach to a few local mortgage brokers in order to determine if the interest rates they can secure are lower than the rate offered by my current mortgage servicer. It is also wise to determine the closing costs offered by each in order to determine your break-even point. Once you decide, be prepared for the process to take a significant amount of time. Lenders are receiving as many as 1,000 application per month with prospective owners wanting to participate in this program. From the time your application is submitted, the process may take 3-6 months. I will tell you though, that the savings can be well worth the wait.

If you would like more information regarding the HARP program or would like to have your rental property managed, please consider hiring FRE Property Management. We are the premier property management company in Utah and will provide you the peace of mind knowing that your investment will be taken care of. Contact us today at 673-5692.