Property Manager Archives - Legacy Properties-PM

Income Property Investors Use This Sneaky Trick

Income property investors are a brave breed. They have to stay on top of the market, have large sums of cash at their disposal, and be lucky.

Right?

Well, luck never hurts, but a great team, is really the sneaky trick income property investors use. Here are the four main things savvy income property investors know, and the team that is needed to create “luck”.

Income property investors know the reasonable costs

Understanding the costs associated with having a renter is important. These need to be measured to allow for a reasonable reserve of money for repairs, maintenance, insurance and the ‘unknown’. Much of this comes from experience, and if they are new and don’t have it yet, it is a good idea to have a Mentor- someone who has done it before. A good Home Inspector and reliable and reasonable General Contractor, must make the team. Without a clear understanding of reasonable costs, getting funding, from any source, will be difficult.

Understanding the market

Over or underpricing the rental can be very detrimental. It is important that the rental is priced correctly. At minimum, it needs to cover costs, however getting fair market value for the rent is the goal. Additionally, understanding how changes to the property can affect the rental is important as well. For example, if adding a washer and dryer hook up for $350 will bring in an additional $50/month is rent, that is valuable to know. A Property Manager understands the market and what is going to bring in the most bang for the buck. Their small management fees are typically offset by the value they bring in proper pricing to maximize profit.

Having access to legal support

Legal support is a normal part of any business venture. From reviewing contracts/leases to dealing with ending a contract, a lawyer is a key component to protecting your assets. Being on top of the law will help in resolving conflicts before they happen and having proper remedies if they escalate.

In this category also fall a good Accountant, an investment focused Real Estate Agent and an ethical Property Manager. All three have a valuable component to offer in transacting business as an income property investor. The accountant is going to help you best discover tax savings and keep you compliant with laws around that. The Realtor is able to help protect against purchasing the endless “fixer upper” with an investment mindset. And finally, the Property Manager is going to manage the day-to-day business of managing the income property or properties. Which brings us to…

Using a Property Manager

Property Managers are like the General Manager of a business. They allow the owner (the income property investor) to focus on growth (like searching for another income property), or enjoying the growth (like playing golf Thursday morning). Property Managers manage the biggest part of the “team” which are the vendors.

Plumbing will fail. Grass will grow and snow will fall. All the needs of the homeowner, such as windows, siding, roofing, electrical and more, don’t go away. They still need to be handled and one of the roles of the Property Manager is to get good, qualified vendors in place to handle the maintenance and emergencies that come with living in a home.

The additional benefit of a Property Manager is that it their primary goal to protect the real property- the home. This means they are on top of laws and they manage the tenants themselves- from applications and background checks to making sure the home is in great condition when the tenants vacate the property. And, in the worst of scenarios, they manage an eviction, late payments and the rest of that “stuff” owners don’t want to deal with.

Income property investors can have a good business of passive income. With a great team in place to help with the business of running the day to day operations, it can be a dream lifestyle. If you have questions about becoming an income property investor, or if you already are and are looking for the support of a great team, call 720 989 1996 and contact Legacy Properties-PM today using the form below.

Free Property Assessment

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The top 3 reasons property owners change Property Management Companies

Property Management

As a Denver Metro and Aurora Colorado Property Management company, we never want to see our clients go. And there is something bittersweet about getting clients from another property management company. After all, we want our industry well represented and we want people to get a tremendous value from using a property manager, because “a rising tide lifts all boats”.

Here are the top 3 reasons we have found that causes someone to ‘jump ships’ in the property management world.

Lack of Communication

This problem is certainly not unique to the property management industry. In fact, the irony of our super connected world, where you can communicate with people via dozens of methods, we suffer from lack of communication more than ever. You can call, text, email, Facebook message, leave a voice message, write a note, put a note on an invoice… yet somehow, we fail to know the BEST way to communicate with any given person, and therefore communicate in the way we like best, or sometimes, not at all. We can take for granted that the other person somehow heard from So-and-so, or will know the work was done, the bill was paid, etc. by way of NOT receiving something.

Nothing can lose a customer faster than simple lack of communication. Owners want to know expectations and they want to know results. Without these two things, it is like talking to a sail. Eventually, the owner feels ignored and they go looking for someone to talk to, someone who will listen, someone who lets them know they exist and are appreciated.

Too many tenants

There are a lot of costs involved with getting a rental filled. Marketing the property, spending money on conducting background checks, and labor hours to interview prospective clients, are just a few. Owners have to cover these costs, which cuts into their profits.

When an owner is dealing with constant tenant turnover, it is a hassle, and worse, cuts into their profits.

Why is there high tenant turnover? It can be a result of:

Unqualified tenants. The Property Manager possibly didn’t do a thorough job of screening the applicant. Even though the applicant was able to produce employment verification and the required deposit money, the employer wasn’t contacted. References, including the former landlord, weren’t called. Basically, due diligence wasn’t done and the tenant ended up being low quality. This happens sometimes- people get laid off or have medical emergencies, but when tenant turnover is high, repetitive and habitual, it is an issue with the manager.

Poor Management. If the Property Manager is neglectful of the tenant, this can result in high turnover. Ever heard the term “slumlord”? This is the term that is applied here. When the Property Manager ignores the legitimate needs of the tenant, is belligerent regarding requests or otherwise is problematic with boundaries, laws or ethics, this is a big problem, and tenants won’t stay.

Tenant Dissatisfaction. This goes hand in hand with poor management, but is separate for another reason. Sometimes the needs of the tenant changes- they moved into a one bedroom and now they have a baby on the way and want a second bedroom. This is not something that can be foreseen or controlled. But, when tenant dissatisfaction comes from the property not being maintained, or the rent is too high, those can contribute to tenant turnover. While most people will say their rent is too costly, there is the truth of what the market is barring. If comparable units are going for a third or half of your unit, tenants are likely not going to stay. A good property manager keeps up on the market trends.

Lack of communication between property owner and property management

This has been said already, but needs to be said again because it is so important. Good communication should be the goal of a Property management company. Owners should expect updates on the property including inspections, any changes and always the status of vendor service orders.

Is it too much for a home rental property owner to be given an update on a repair status? We think not.

If the property management company you are using is no longer steering you the way you want to go and you are looking for a change, Legacy Properties-PM would love to help. Want to avoid the pitfalls of poorly managed, high tenant turnover companies? Call 720 989 1996 and contact Legacy Properties-PM today using the form below.

Free Property Assessment

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A Quality Property Management Company Can Make Investing w/ Out-of-Town Real Estate a Possibility

Property Management, Real Estate Investing

When many people think about a real estate investing strategy, they often look only at properties in their own geographic area.

This might be a wise idea if a person plans on dealing with all the landlord responsibilities themselves, or doesn’t have a property manager they feel confident in, but a quality property management company can open up a whole new world.

Thinking about having to travel by plane or long road trip to visit and check on your property can cause anxiety. Some people never even consider it because they start to ask themselves, “What do I do if the tenant doesn’t send the rent? What if there’s an urgent maintenance issue, like a broken furnace or a leak in the roof? How do I know the renters are taking care of the place and not trashing the property?” Obviously it’s not an option to travel every time an issue comes up, but with a well-qualified property management company, there’s no need to fret over these questions.

In the greater Denver and Aurora area, Legacy Properties-PM is a property management company that takes care of everything on your list of concerns. Because they started out managing their own properties, they are experts at showing and renting you property, taking care of leasing paperwork, collecting rent, dealing with maintenance needs, performing property reviews, and even evicting tenants.

Whether you live close by or the other side of the country, there’s no need to worry when you have an experienced property management company that truly cares about your property and your investment.

When you hire Legacy Properties-PM, a property management company you can trust, it opens doors to other markets for investments. The Denver market is busy with people constantly moving to the region to take advantage of all the area has to offer. If investing in this area is something you’d like to consider, Legacy Properties-PM can even help you find a desirable property at a great price.

If you’re ready to think outside the box and invest in a single family home, condo, or townhouse in the greater Denver area, contact us or call 720.989.1996.

Even if you live out of town, our property management services make it a great option for investors.

How do I pick a good property manager?

Aurora, Denver, Property Management

In Denver and Aurora, there are many very good property management companies.

The question then is, how do you decide which property management company is the best one for you?

What I tell people all the time when this comes up is that while you do need to make sure that the one you choose has the experience and training needed. But, you also need to feel a personal connection with, someone that you feel you can trust. The first part is a much easier one to answer. The most important part to finding someone who is trained and highly qualified in any field is to look for those that invest in themselves. In the case of property management, that means looking for someone who is a member of the National Association of Residential Property Managers. NARPM members spend hours learning what is happening legally at the federal, state and local levels. The truly dedicated ones even take it one step further and earn special designations. These designations require a greater investment in time, more specialized training, and giving back to their community of property managers by way of service. The other things that you need to look at when selecting a property manager for your investment would be:

Price – While important, this should not be your primary consideration. In the Denver or Aurora area, most, if not all companies charge a percentage. The most common are between 8% and 15% of the collected monthly rent. Depending on how much time they spend on your property, it usually works out to about $4-$8 an hour. Some also charge a flat fee that is due every month; this is something the Legacy Properties-PM does not do. The other cost is the leasing fee, in other words, the fee charged for the handling all of the prospective tenant contacts, showings, application reviews and lease writing. This is also usually a percentage-based fee and there is a wide range out there of what is charged. You need to talk to any company that you are considering about what you are getting for your money, and see if you can get references.

Experience – This is probably the most important thing for you to look into. Not only how long have they been managing homes, but also what experience do they have that ties in with it. Some examples would be: do they own any rental properties themselves, have they done any hands on cleaning or repairs of rentals, have they personally done any evictions. The staff at Legacy Properties-PM has done everything from cleaning and repairs to being a part of the physical eviction team and everything in between.

Fees – I actually think that this is far more important the price, because this is where your dollars can really add up. You need to know what items your property management company will be charging you for. The most common one is a renewal fee, this is charged for the time spent in discussions with you and the tenant and getting the proper paperwork filled out. Other questions to ask would be: Do they add anything to your repair bills, or charge for property reviews? I’ve even heard on some companies that charge a “paper-processing fee”. What that means is that they add a charge on to every piece of paper or email that they come in contact with for your property. Do they charge a service fee for your evictions, or insurance claims?

Maybe they charge an advertising fee or an account setup fee. These are all things that you need to find out and decide for yourself if they are worth it. With Legacy Properties-PM, you’ll only have three fees. The leasing fee, the management fee and the renewal fee, that’s it.

One other thing you might want to ask them about is how they handle calls that come in after hours and if they will show your property during evenings and weekends. These are very important in keeping your property in good repair and getting it rented quickly.

Once you have done all of your research and compared all of the companies, it’s time to narrow it down to the best two or three companies for your needs. Now comes the hard part, you need to contact those companies again and have a one on one conversation with the person who will be managing your property. Talk to them about your goals and expectations, they may be right on track with you, or maybe not. Either way, you will have a good idea if your personalities match or not. Remember, this is likely to be a person that you will be having a business relationship with for years to come. So, if it seems strained, or they don’t feel genuine to you, then you probably want to keep looking.

Call 720.989.1996 or contact us Legacy Properties-PM; the best in property management in Denver, Aurora, Centennial, and more.

The Top Five Calls You Won’t Get When You Hire a Property Management Company

Property Management

Many Colorado landlords struggle with the idea of whether they want a property management company overseeing their investment.

On one hand, it’s nice to be involved and know whats going on. On the other, when things aren’t going well, your phone is ringing constantly and you have non-stop anxiety over dealing with whatever is going on in addition to all your other responsibilities. During those times, it’s easy to make the decision. From a casual poll of property owners who have teamed up with property management, these are the top five calls they don’t miss getting:

“My heat/AC isn’t working.” HVAC is one of those things you don’t give much thought to until there’s a problem, and it usually happens on the hottest or coldest day of the year.
“There’s a lot of water on the floor.” This is usually the start of the conversation, and then you have to play guessing games to figure out what’s going on. Did the toilet overflow? Is there a broken pipe? Maybe the roof is leaking. Water problems are one of those problems you can’t put on the back burner. They must be dealt with immediately.
“My neighbor is too __________.” You fill in the blank. Noisy, smelly, inconsiderate, and the list goes on. It’s hard to know when to get involved in disputes between tenants, and it’s never fun.
“I won’t have my rent until next week.” Chasing down rent is one of the worst tasks, especially from a tenant who chronically pays late. The excuses can get humorous, but the hassle is no laughing matter.
“I know the lease said no pets but…” People are forever signing a lease and then asking to change the agreed upon rules, and many times it’s about pets. One cute little puppy can’t hurt anything, right? Wrong!

Whether you’ve been managing your own investment properties and have experienced these calls before, or are just getting into the game and are not sure you want to handle these types of issues, a property management company will take these calls so you don’t have to deal with them. Enforcing the lease, dealing with maintenance needs, and collecting rent are just a few of the tasks that they take care of so you have more time and less stress.

In the Denver area, Legacy Properties-PM is happy to take these calls. For more information, contact us.

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