Property Management
April 15th is just around the corner. If you’re really on the ball, your federal and state taxes are already submitted, but if not, there’s no need to panic just yet. You’ve got plenty of time and some things to consider. If you’re expecting a refund from your taxes this year, maybe it’s time to think about investing it. If you have ever considered real estate, this is a great time to talk to a residential property management company.
Many people get so excited about the unexpected money that they blow it on something they think they really want. Sales of new cars, televisions, and vacation packages increase this time of the year for a good reason. But once that new car smell wears off or the vacation is over, many people probably wish they’d made a wiser choice.
That income tax return could make a nice down payment on a house, condo, or townhouse that you can rent out to improve your family’s financial health. In the long run, you’ll build equity in the property, but residential real estate also gives you the opportunity to increase your income now when you make a smart investment.
Not sure where to start? An experienced property management company that keeps up with the local market can advise you. In the Denver area, Legacy Properties-PM can help you find real estate that is a sound investment. We know what tenants are looking for, and the right property will make finding responsible renters easy.
If you’re not sure you have the time or inclination to be a landlord, our property management services can take care of most of the work for you. From finding tenants and taking care of the leasing paperwork, to collecting rent and fielding maintenance calls, our services allow you to reap the benefits of making a wise financial investment without taking up a lot of your time.
This year, don’t blow your income tax return on something frivolous. Make a wise investment that will start a financial legacy for your family. Legacy Properties-PM can help you with the process, so call 720.989.1996 or contact us for more information.
Property Management
If you own Denver or Aurora residential investment property, then you know how much work it takes to keep up with things.
Leasing paperwork, collecting rent, and dealing with maintenance issues are just a few of the time-consuming tasks, and if you’re like most owners, you may wonder if it might be better to hire someone else to carry some of the load. As an investor, the question that probably comes to mind is “How much do property management companies charge?” There are two different approaches to this, and it’s important to know what you’re getting before signing on with any property management company.
Property management costs vary depending on the market you’re in and how the business is organized. Some companies charge a flat fee each month for management. In several major metropolitan cities, the average seems to be about $80.
Other companies price property management services on a percentage of the rent. On average, companies usually ask for about 10% of the rent collected.
Property Management
covers services such as collecting rent, working with vendors to coordinate maintenance needs, conducting property reviews, and keeping track of financial records. Sometimes there is an additional leasing fee, other times that cost is included in the property management services.
In addition, most property management companies offer additional services. Tenant placement services include thorough checks and investigation to make sure you’re getting a quality, responsible renter and is usually a one-time fee. Some companies charge as little as 50% of the monthly rental amount, all the way up to 2 times the rental amount.
While the fees can be confusing, there are two questions owners must ask. First, is the company you’re considering capable and trustworthy? Second, how does hiring a property manager change the situation?
To find a reliable company, find out if they are a member of NARPM, the National Association of Residential Property Managers. This ensures they are ethical, professional, and at the top of their field, knowing the ins and outs of their local market.
A quality property management company will change the situation for the better. First, they take over much of the responsibility, freeing up your time. Second, as experts in the field, they have knowledge that will save you money in the long run. Maybe they discover your property could go for a higher monthly rent, or they have contacts with local vendors who do better quality work for less. That, in addition to the fact that property management fees are typically tax deductible, means the monthly fees are well worth it in the long run.
In the Denver, Aurora, and Parker Colorado area, Legacy Properties-PM is an experienced property management company that is associated with NARPM. Our management fees are 10% of the monthly rent, as well as a leasing fee of 35% of the first month’s rent. If you wish to take advantage of tenant placement services, they cost 50% of one month’s rent. For more information on our services and fees, please call 720.989.1996 or contact us.
Property Management
When you buy a rental property with a self-directed IRA (individual retirement account), it’s not just easier to rely on a Denver property management company.
It’s also the legal approach. According to an article by Forbes, the IRS expects a third-party property management company to oversee property owned as part of a self-directed IRA arrangement. Some investors have misconceptions because the term “self-directed,” conjures up a DIY approach. While you do decide which property to buy and who to hire as contractors and property managers, you can’t perform work yourself or live in the rental. In other words, you don’t put “sweat equity” into a rental you purchased through a retirement account.
- Understanding the advantages
Some of the advantages of buying an investment property in Denver with a self-directed IRA include having your asset grow tax-free and relying on others to do the manual labor and management. Another major advantage is the fact that using a self-directed IRA means you can make an all-cash purchase on an investment property. In many cases, a seller will offer a better price or terms for all-cash buyers. You can also tap the self-directed IRA to pay contractors and your property management company, which means no money out-of-pocket for you.
- Remembering the restrictions
The IRS is strict about rental properties purchased through an IRA. You can’t use the property as your vacation home or personal residence. You can’t allow your children, grandchildren or parents live in the home. According to a piece by Wealth Counsel, it’s important to talk to a tax attorney before forming a self-directed IRA. Since the housing decline, a lot of investors have misused the accounts by failing to comply with IRS rules.
Having a property manager for your rental property in Denver can provide peace of mind for most pre-retirees who want a good return on their investment. With the volatile stock market and financial uncertainty in the global financial markets, it makes sense to buy real estate in a booming market such as Denver. Using a self-directed IRA helps investors who have retirement savings but don’t want to dig into their emergency fund or paychecks.
At Legacy Properties-PM, we provide excellent property management services for investors in the Denver area. We belong to the NARPM, the National Association of Residential Property Managers. For more information of self-directed IRAs, please call 720.989.1996 or contact us.
Property Management
There are ups and downs with any real estate investment experience, but the eviction process is probably the hardest thing to deal with.
Landlords who have gone through this know that having a property management company on board from the beginning makes the eviction process much easier.
The biggest reason for evictions is a tenant who is late paying the rent. A property owner has to know the terms of the lease, which states exactly when rent is due, and if there is any grace period.
There are specific guidelines for the eviction process including:
Serving the tenant with a 3-day notice to “Pay or Quit”
How to serve the notice (whether it requires hand-delivery or via certified mail)
How to count the three days (the delivery day does not count, nor do weekends or holidays).
The eviction process requirements vary by state.
If the tenant will not leave, then you must go to your local court to start legal proceedings. You will be given a court date and will need to have the tenant summoned. When going to court bring any and all documentation to support your claim, including communication between you and the tenants, receipts, bounced checks, a copy of the lease, and proof of the 3-day notice. It may seem like an easy case, but this is where it gets complicated.
In Colorado, courts will decide in favor of the tenant
Since many tenants can’t deny they failed to pay the rent, they try to get out on a technicality. If you failed to complete any part of the eviction process or forgot to “dot an I or cross a T,” the court will decide in favor of the tenant. Then you have to start the process over.
The eviction process is complicated, time-consuming, and extremely stressful. The best thing you can do is partner with a property management company from the start, so there’s no need to panic when it gets to this point. They take care of all the legalities, including signing the lease and collecting the rent. If there is a problem, they know the eviction process and have the proof to go to court and win the eviction.
If you own investment property in the Denver area, contact us or call 720.989.1996 to take advantage of property management services. Legacy Properties-PM has the experience to find quality tenants so you probably won’t have to deal with an eviction in the first place, but if it comes to that, we know exactly how to handle it.
Property Management
April 15th may still seem like a long way off, but it will arrive before you know it. Filing income tax returns can be complex for someone who works one job and files the easy form, so if you own investment properties and find it daunting, you’re not alone.
The first challenge is knowing what is tax-deductible. You’ll need to get specific guidelines for your state, but in general, the following items are deductible:
- Interest paid
- Insurance
- Legal services
- Property management fees
- Losses due to theft or casualty
- Repairs
- Depreciation
- Some travel expenses, both local or long-distance
- Some home office or workshop expenses
The next issue is keeping track of all of these expenses. If you’re like many income property owners, you might have a shoebox somewhere that may or may not have receipts from the year. You may have started out strong and organized, but as time goes by, they get stuffed in a pocket, your car, or even thrown out.
While a property management company will not do your taxes for you, having them on your team will help you when tax season arrives. They keep track of your rent income as well as any expenses directly involving them, including maintenance and management fees. Plus, because those property management costs are deductible, it makes even more sense to use their service.
Every deduction you can claim makes your investment property more profitable. If you find it difficult to keep track of income and expenses, let us help you with your property in the Denver area, including the Centennial & Aurora areas, as well as, Parker & more. For more information on how Legacy Properties-PM can help you with keeping records as well as the day-to-day operation of your investment, please call 720.989.1996 or contact us.
