Paying a property manager to take a slice of your pie might seem excessive.  After all, a property manager just finds renters and collects rents right?  Wrong.  If you’ve owned a rental property for quite some time, you’ll know that a property managers fee is a small bit of insurance when the going gets rough…and it will get rough. Not to mention, property managers are skilled at saving you money and time. Usually in the time it takes you to get your own home rented, a skilled property manager could have saved you a mortgage payment!

A successful rental is only as good as your tenants.  The key is to get the largest stack of applications to choose from, not just one or two.  Getting all those applications is what property managers do best…if you let them.

What does a property manager do?

A [good] property manager does more than just collect the monthly rent.  They provide a full list of  services that you aren’t likely to do on your own.

Experience is everything.   Renting out your home is best left to the people who know and understand landlord/tenant law, especially if things deteriorate.  A good property manager has the experience in not only identifying great tenants through screening processes, but can also employ conflict resolution if needed.   You might get lucky on your own, but a property manager has the experience and skills to avoid pitfalls and common mistakes by do-it-yourselfers.

Here is a quick list of things that good property managers do daily:

• Competitively price rental rates with the market.
• Advertise and promote your property effectively.  Anyone can buy a $12 “For Rent” sign and put up an ad on Craigs List, but can you access a database of real estate industry relationships and share your vacant rentals with other industry professionals?
• Show your property at the drop of a hat.  While you’re working people want to see your home.  If you’re not available, the other rental is and that’s where tenants go.
• Interview prospects.  You might be a nice guy, but can you identify a snake in the grass?  In my 5 years of management, there are at least 3 things every bad prospect will say and when they do, they’re off the list.
• Screen Applications.  Easy enough right!  You bet, collecting the appropriate documentation to prove income, employment and good rental history is just the beginning.  How about prior eviction filings or even criminal history?
• Run a Credit Check.
• Execute a strong lease.  Do yourself a favor, don’t get a fill-in-blank lease from Office Depot or Staples.  Instead, have a lawyer draft you one that will work with Idaho Code.
• Perform inspections.  Keeping on top of the issues before they happen is key.  Thousands of dollars of damages can happen in one day.  If you don’t check up on your property how will you know what’s really going on inside?
• Enforce a lease.  Knowing how and when to evict might come up.  In fact, it’s not a matter of if, it’s a matter of when.  To do it right takes a firm understanding of Idaho tenant/landlord law.
• Repair work.  When a pipe breaks, you need immediate action.  With preferred relationships, property managers will get service before you do every time.
• Reduce loss.  Knowing how to reduce the turnover rate in a rental is important when considering the validity of your investment.  What can you do to keep tenants in your house?

Before you attempt to manage your own rental:

Ask yourself the following questions

• Do you have experience managing rental property yourself?
• Are you familiar with fair housing and landlord/tenant laws in the jurisdiction(s) where your property is located?
• Do you have relationships with contractors that ensure you can get 24 hour service at reasonable prices?
• Do you have a reliable means to determine fair market rent and returns on your investment property?
• Do you know and have the proper notices and legal process to deal with non-paying tenants?
• Do you have a current, professionally crafted lease and related agreements/forms to minimize your exposure to liability should a tenant sue?
• Do you have relationships within the real estate and rental community to get leads and referrals for outstanding tenants?
• Do you have 24/7 availability to manage the property.
• Can you show the property daily?

If you answered ‘NO’ to any of those questions, then you should likely hire a property manager to avoid wasted time and excessive loss.

If you’d like a free consultation about the services that my company, Southern Idaho Management LLC., provides, just give me shout: 208-724-7602!

Property Management is just one of the services that I provide as a Real Estate Agent.  As such, I’ve decided to ditch my old property management website and put all of my available rentals here on Boise Real Estate Soup.

You’ll notice that at the top of the site along the navigation bar, you’ll see a page that says “Rentals”.  Click that button and you’ll see that I have them categorized in the areas that we currently have availability.  Right now we have a few homes for rent in Boise and one home for rent in Meridian.

If you know of people looking for a place to rent, just send em over to the site or have us call em!

Also, don’t forget to sign up on my RSS Feed for notifications by email or on your Google Homepage!

Welcome to the very first ‘Guess The Place’ photo contest!  I’m out and about the Treasure Valley all the time and will be posting photos on my blog and if you can Guess The Place, you win!

It’s pretty simple really – be the first to successfully guess the photo and leave a comment below with your answer.  At the end of the day, I’ll approve the comments and see who the winner is!

Make sure you leave an email address so that I can get you your prize!

For me, property management is an integral part of my real estate business. It keeps me connected with the housing market at large, not just the buying and selling part. Property management allows me to make contact with investor buyers/owners who are in the business of providing rental units to the rental market. It’s also a great opportunity for me to stay active in the residential real estate market even when I am not working with a buyer or seller; I get to meet people who are relocating, people who have sold their primary residence and are looking to buy another and even college students among many others.

What does a Property Manager do?

As the name implies, I manage the day to day operation of a residential building from single family homes, duplex or multi-family dwellings for the owner. Essentially, we take over the tasks that all landlords are responsible for, but we handle them in a professional, legal manner.  Here are just a few typical tasks or responsibilities we find ourselves doing as property managers:

• Screening Tenants
• Collecting Rent Checks
• Scheduling/Coordinating repairs and upgrades
• Paying utilities, bills, taxes and warranties
• Showing Rental Properties
• Posting advertisements about vacant rentals
• Inspecting Properties and doing walkthroughs

Again, these are just a few of the responsibilities that we handle on a day to day basis as property managers.  Recently I wrote a list of important things that a property owner should be doing with their own rentals if they don’t currently have someone managing for them.  These responsibilities shouldn’t be taken lightly.

How much does a property management company charge?

I cant speak for every company, but I charge a percentage of gross rents received and that percentage is usually between 8% and 10% depending upon the property, location and other circumstances.  The fee I charge on a typical rental is usually $70-$90 per month; Less than the monthly utilities.

Why would someone need a property manager?

There are many reasons that someone would want a property manager, but here are some of the reasons that my current clients have:

• The Property is owned through a Self Directed IRA/Trust
• The owner doesn’t have time to deal with the responsibilities.
• Collecting rent and keeping track of income and expenses is a hassle.
• The owner lives out of State and can’t reasonably manage the property.
• Most owners are not skilled or capable of showing, screening and meeting tenants because of their ‘personal attachment’ to the property.
• Because we understand the business and know how to deal with just about every circumstance that could threaten the property.

Most owners call us because they aren’t familiar with how to convert a home into a rental.  While it sounds simple, there are complex housing laws that are always changing.  In addition to the legal aspect, there are ‘tricks of the trade’ and knowledge that I have over someone who has never managed a rental unit.  The cost of hiring a manager is well worth it when you consider the liability and the time associated with properly managing a home.

What is the current rental market look like?

At the time of writing this letter, the outlook for property owners is mixed as well as it is for tenants.  As with the re-sale real estate market, the outlook is based on location, time of year and type of home.  But, with the re-sale market continuing to slip, the opportunity for owners to purchase quality real estate is quite good!  For tenants however, be weary!  There are a lot of good rentals available, but many are in some sort of financial distress where owners have stopped or are going to stop making payments to the bank which means you are likely to get evicted once the home has been auctioned.

In the coming months, expect there to be fewer quality rentals available and prices to trend upward with the warmer weather.  Here is a list of my average rents throughout the valley:

• Southeast Boise- 3 bed 2 bath 1500-1750 square feet- $1100-$1200+ (quality market for owners- short supply is the cause)
• Meridian- 3 bed 2 bath 1200-1500 square feet- $750-$900 (moderate to high inventory)
• Meridian- 4 bed 2.5 bath 2000+ square feet-$1200-$1500

• Kuna- 3 bed 2 bath (and a bit larger) 1500-2000 square feet- $850-$1000 (for whatever reason, homes are renting quick)

Do I need to hire property manager if I own a rental?

In one word, yes!  Certainly, you are capable of managing your own rental, and perhaps you’ve been doing so just fine, but, there will come a time sooner than later that the scope of your knowledge and understanding will not cover a certain scenario, usually by that time much is lost.   If you aren’t updating yourself on the changes in law, the changes in marketing and protecting your rental like a professional company would, then its time to give us a call.  We can diagnose your situation or even give you insight into how to get started in acquiring rental properties and start building a solid rental portfolio.

Being a landlord isn’t easy but given the Resale Real Estate Market, many homeowners are turning their home into rentals. It can be a great idea, but, few of the owners with for rent signs are actually operating their rental in professional manner and in some cases illegally. Managing your own rental can be done, but there are many pitfalls and dangers if its not taken seriously or with care. The consequences are great and it’s your home at the end of the day that you are putting out there to be treated either with care, or vandalism. Hiring a professional Property Manager is great idea because of the experience and professional care involved.

The statement that gets me the most from wannabe landlords is, “I can’t afford a Property Manager”. Little do they know that my fee is usually less less than the gas bill and with the property management services that we provide, we can actually save them money – in some cases, thousands of dollars per year.

In either case, what are the things that most rental owners aren’t doing that they should be? Here’s a list in no particular order:

#1 Execute Effective Marketing Strategies

To catch fish, you have to go where the fish are, simple, right?  Well not exactly.  You can still see that most owners still advertise in print media.  Why?  I estimate that at least 25-50% of all calls we get on our ads are from people who are relocating to the Boise Area.  So, again, why would they be looking in a printed paper?  They aren’t!

Good Bait:

• The internet.  Most people put an ad on Craigs List, which is a good start, but its a ruckus.  You get what you pay for.  I advertise my rental properties on no less than 15 websites.  Each rental has its own URL so it can easily be found or can be used to link to other sites, or to send to people in my network.
• Social Networking Sites.  Whenever I have a new rental that needs marketing, I post it to all of the Social and Professional Networking sites.  On Facebook alone, we give a call to action to over 150 “Friends” to go see the listing and notify anyone that they know who is looking to check it out!
• Real Estate Networks.  I leverage my vast network of colleagues who almost always know of someone who needs a rental.
• Applicant Data Bases.  I keep a track of tenants who are looking for rentals and whenever I have a new property come up, they are the first to be notified.  The best part of it is, they are usually already qualifed to move in!
• Signage.  Duh!  Of course we use signs

Don’t think that just because you are putting your listing on Craigs List that you won’t be on page 3 by the end of the hour.  Most people are listing their properties there and so should you, but realize, that it’s not Maximum Exposure.  Do you want a couple of applications or a bunch of them?

Most landlords don’t even do this step! Why, because its complicated. Most screening companies have requirements that the average Joe can’t even meet.

#2 Run Credit Reports

Credit reports turn up current and past financial history and gives you a current idea of the prospects debt to income ratio which helps you determine if your applicant makes enough to comfortably pay you rent each mont.  It also turns up any legal items like leins from past landlords and property managers or any outstanding collection items from utility companies.

#3 Perform an Eviction History Search

It is what it says.  We run an eviction search on every applicant to see if they have ever broken a lease and were legally evicted.  An eviction is a big red flag that should not be overlooked.  If your applicant got evicted from a previous residence, why would you want them to be living in your place?

#4 Do a Criminal Search

While it’s illegal and unethical to discriminate against a tenant for their Age, Sex, Race, Color, Religion, National Origin, Familial Status, Pregnant Women and Handicap, it is not illegal to discriminate against a felon.  We run a Criminal Background on every applicant and have found some applicants who have been charged with Vandalism, Grand Theft and even writing bad checks (probably rent checks).

#5 Verify Current and Previous Residency

We interview past landlords about the residency of the applicant in question.  This turns up valuble information of you know the right questions to ask.  Contacting more than the current landlord is obvious for many reasons, but more importantly, if you go back a ways, you might be lucky to find a past landlord who remembers how great the were.

#6 Verify Applicant Income

Before we even SHOW a property to a prospective renter, we verify income.  There is no reason to rent to someone who will be getting laid off or getting hours cut back after the Holidays.  We contact past and current employers to verify their income so that when you go to cash the checks, they don’t bounce.

#7 Disclose Lead Based Paint Hazards

If your home was build in 1978 and prior, you had better be doing this!  Failure to do so will result in at least a $10,000 fine.  There are Federally Required disclosures that you need to use and a Federally Approved Pamphlet that must be delivered to the tenant prior to signing the lease.  Forgetting this one could have paid my management fee for years and years to come!

#8 Conduct Move-In Inspections and Documentations

When a tenant moves in, you should have a comprehensive property checklist that you and the tenant fill out to note any pre-existing damages prior to them moving in.  They need to sign this!  When they move out, there will be no question as to which damages are new and which ones were existing.  It will also serve as evidence should you wind up in small claims court.

#9 Perform Periodic Inspections

One of the most overlooked aspects of property management.  Stopping by the rental on a scheduled periodic basis helps prevent damages before they occur or get out of hand.  I’ve seen tenants do over $7500 in damage in less than 30 days…Imagine what would have happened if it was 1 year!  (Fortunately, these tenants weren’t associated with our rentals)

#10 Enforce your Lease

What are you going to do when a tenant lets the lawn and flowerbeds go to weeds?  What happens if you have a tenant late on rent?  There are a TON of things that qualify for breach of lease, but how you enforce the lease is just as important as how you identify the violation itself.  Most owners get caught up in being “Mr. Guy” and letting violations happen.  This reason alone is enough to pay a management company a small fee to take care of the property.  Property managers are a shield between your tenants excuses and your easygoing charitable nature.

#11 Start Bookkeeping

Keeping the books organized and itemized is just as important as collecting good rents.  At the end of the year or at any given moment you should be able to print out an accounting of your income and expenses so that you can claim any gains or losses on your taxes.

#12 Hire a Property Management Company

With all of the time, the potential pitfalls, legal implications and information associated with managing a rental, you’ll be far better off having a Property Management Company in your corner.  While they aren’t the ones to blame if things get bumpy, they are there to prevent hitting the bumps in the first place.  Southern Idaho Management was started by me and my wife out of a necessity to manage the rentals that we owned.  Our real estate clients liked our real estate work and nearly demanded that we manage their rentals too.  We do far more than the items on this list and take pride in our work.  Our fee is cheap in comparison to you stepping on one small legal landmine and with all of the time necessary, you could be out focusing on your career, small business or time off with family.

If you or someone you know has a rental property get in touch with us to see how we can help relieve the headaches and help you avoid a serious costly disaster.  Our coucil has saved our property owners Thousands of Dollars.  We can be reached at 208-724-7602.

Check out our current Boise, Meridian and Kuna Rental inventory.