Property Management and Investor Information

Showing Vacant Rentals After Dark

Wed, 02 Dec 2009 00:03:53 -0600

Each winter the subject comes up about whether it is advisable to show vacant rentals after dark. This time of year it is getting dark around 5 pm which is pretty early.

We have a policy not to show after dark. That means we do not show past 5 pm during the winter. The reason is simple, the safety of our showing agents.

We do get an occasional compliant about this, but most people understand and stick to daylight showings. I sleep better knowing that we are not walking around vacant property at night.

ACH Phishing Alert

Thu, 19 Nov 2009 15:24:31 -0600

The Electronic Payments Association (NACHA) has just released a Phishing Alert.

Individuals and/or companies may have received an e-mail with the subject title “Rejected ACH Transaction”. The e-mail, which appears to be from NACHA, indicates that there is a problem with an ACH transaction, and contains a link that redirects to a web page that resembles the NACHA web site.

This is not the NACHA web site. DO NOT OPEN THIS EMAIL as it will infect your PC with a malware virus.

If you have questions or need assistance, please call Global Treasury Management Services at (800) 322-2778, Monday through Friday, from 7 a.m. to 6 p.m. Pacific Time, excluding Bank holidays.

The bad guys are out there 24/7.

What Do You Do If The Rent Is Not Paid?

Wed, 18 Nov 2009 10:53:28 -0600

One of the many nightmares in a property manager's day (yes nightmares are possible during the day of a property manager or property owner) is when the rent does not show up. It might even happen when a manager has auto draft from their bank since funds have to be in the bank to collect.

When this happens we suggest the following steps:

1. Call the tenant on the next business day after the rent becomes late. Note: The tenant gets the next business day to pay if the due date falls on a weekend or holiday. Tell the tenant that you have not received the rent and to avoid a 3 Day Notice being served it must be received immediately. Listen to their story but don't make any deals.

2. If you cannot get them on the phone or if you can, serve a 3 Day Notice to Pay Rent or Quit (in California) as soon as you can. See your property manager or attorney if you do not know how to do this.

3. When the notice expires begin an eviction using a local eviction attorney.

4. Drive by the property at least once a week, Monday is a good day, to see if they have vacated.

It is best to be in the drivers seat in this situation. Do not let the tenant be the driver. If the tenant wants to stay, let them sign a stipulation and work out a payment plan. Included in the plan should be a provision for them the pay you back the attorney fees and to admit guilt. In case they default on the stipulation they would be immediately turned over to the sheriff for lockout.

Need more tips? Contact us at www.HomePointe.com

Where is the best place in the Sacramento area for an investor to buy?

Sat, 07 Nov 2009 09:56:31 -0600

It is always a tough decison where to buy since good properties tend to be priced above what makes sense for cash flow (low rents compared to sales price). I personally like to buy in marginal neighborhoods since they tend to have better cash flow and my company is good at picking tenants like South Sacramento(95820, 95823, 95824, 95828). But some like more middle of the road neighborhoods and pay a little more, with less cash flow Natomas (95834, 95835) or Elk Grove (95624, 95757, 95758) make sense for that middle area. Higher end properties like Folsom (95630) can make sense if the deal is good and the investor can wait out the slow sales market. Of course, there are a lot more choices than that, but most fall in one of those three categories.

Fannie Mae Deed for Lease Program

Sat, 07 Nov 2009 09:45:36 -0600

Yesterday Fannie Mae announced a new program it has designed to further assist homeowners facing foreclosure.

The Deed-for-Lease Program (D4L) allows qualifying homeowners to remain in their homes by signing a lease in connection with voluntarily transferring the property deed back to the lender. According to a press release from Fannie Mae, “The new program is designed for borrowers who do not qualify for or have not been able to sustain other loan-workout solutions, such as a modification.

Under Deed for Lease, borrowers transfer their property to the lender by completing a deed in lieu of foreclosure, and then lease back the house at a market rate. To participate in the program, borrowers must live in the home as their primary residence and must be released from any subordinate liens on the property. Tenants of borrowers in this circumstance may also be eligible for leases under the program. Borrowers or tenants interested in a lease must be able to document that the new market rental rate is no more than 31% of their gross income. Leases under the new program may be up to 12 months, with the possibility of term renewal or month-to-month extensions after that period. A Deed for Lease property that is subsequently sold includes an assignment of the lease to the buyer.”

To learn more about D4L please visit www.efanniemae.com. There you will find program details, eligibility requirements, and a helpful FAQ document.

Rental Market Report For Sacramento 4th Quarter 2009

Fri, 06 Nov 2009 13:51:44 -0600

The Sacramento rental market is struggling a bit more than usual. There are fewer rentals available and those that are on the market are not seeing a real strong demand.

Our firm rented out an above average amount of rentals in October which has lowered our overall available properties. It appears the winter will be slow and that usually means the spring will see a rebound.

Vacancy rates are holding at around 5% or lower for single family homes, but don't expect rents to rise anytime soon.

You can access our rental survey at our website: www.HomePointe.com and click on Owner Services.

Rental Market Softening in Sacramento

Thu, 29 Oct 2009 00:15:21 -0500

We have noted that the rental market is pretty soft right now. It is a combination of the soft job market, state furloughs, soft real estate market, lower amounts of foreclosures, and finally, school is in sesson and the holidays are close. In sum, everything is working against a strong rental market right now.

One thing I know, the market in Sacramento has never fallen off the cliff. We have a stable job base in the state, the exception this time being the 10-15% pay cuts for state workers.

The next big event will be the new year. Pent up demand usually makes Janaury a strong month. We will see.

The funny thing is that we are still renting property at a brisk pace. Just at lower prices.

2010 NARPM Past Presidents Golf Tournament in Seattle WA

Sun, 25 Oct 2009 09:40:51 -0500

At next year's National Association of Residential Property Managers (NARPM) Convention and Trade Show the past presidents will host a charity golf tournament. The location in Seattle has yet to be determined but the date is to be October 13, 2010. The shotgun style tournament will be a best ball scramble and each foursome is to include a NARPM past president.

So far we have a committment from Chris Hermanski, MPM, who owns Mainlander Property Management in Portland, Oregon to be the Site Chairman. Mark Kreditor, MPM, who owns Get There First Property Management in Dallas, Texas is in charge of Sponsorships.

The charity part is something that will change year to year based on one of the past presidents selection. For this 2010 tournament the charity is Creative Living Options which is located in Sacramento, CA. Here is some information on this non profit and the work it does:

Creative Living Options (CLO) is a non-profit agency that provides Supported Living Services for adults managing developmental disabilities in Sacramento, Yolo, and Placer counties in California. Creative Living Options: • Enables people to live in homes of their own • Encircles people with holistic, individualized supports • Embraces each person’s lifestyle choices • Encourages and supports people to participate in their communities • Empowers people to pursue their dreams

Their website address is www.creativelivingoptions.com

We have not yet set the goal for funds to be raised but that is coming soon.

I am the this years chair of the tournament and am seeking additional help. Contact me if you are interested. Stay tuned for updates as they become available. I welcome your support.

Will Owners Go Paperless?

Thu, 22 Oct 2009 16:07:17 -0500

Some property managers are telling their clients that they must now receive their owner statements via email and owner proceeds checks via ACH (direct deposit). This is a "go green" proposition and money saving for all as it reduces delivery costs and speeds delivery of both statements and funds.

I am curious what you think of the idea of forcing that issue. A property management company may lose some older and institutional clients by going completely paperless.

HomePointe offers both methods at this time. But, certainly "going green" has its merits if every client does it.

Appfolio Golf Tournament in Orlando Florida

Tue, 20 Oct 2009 16:28:57 -0500

The first annual Appfolio Golf Tournament held at Osprey Ridge in Orlando, Florida in conjuction with the National NARPM Convention and Trade Show went off on time this morning at 9:30 am with a shotgun start.

Bob Machado took the early lead but Chris Hermanski did not remain far behind. In the end, Bob sunk a short putt on 18 for par to win $10.00 and the tournament. Chris came in second but did win the 16th hole, a long water laden par 5.

Next year promises to be an even better and bigger event. We thank all the tournament organizers including Alana Pergis, Aimee Miller, and Albert Oaten. Without Appfolio's committment this tournament would not have been a success. See you next year in Seattle!

Flight to Orlando includes stop at Favorite Breakfast Burrito at Sac International Airport

Mon, 19 Oct 2009 12:26:21 -0500

Whenever I have an early flight out of Sacramento I always stop at La Salsa Fresh Mexican Grill in Terminal A. Their breakfast burrito and and an orange juice is a real treat.

The burrito includes scrambled eggs, salsa, and chorrizo. Just the right amount of food and made fresh.

My flight to Orlando will be much more pleasant on a full stomach without having to suffer through hungry. Give this place a try on your next flight.

National Association of Residential Property Managers Convention Held This Week

Sun, 18 Oct 2009 17:31:47 -0500

The highlight of year for us single family property managers is the national convention. This annual event is being held this year in Orlando, Florida.

Among the many features of this event are a trade show featuring the many vendors that serve our industry including software, advertising, and credit reporting companies. There will also be keynote addresses, classes on many subjects of interest to professional property managers, and lots of networking. Getting to know managers and how they do business all over the country is a huge advantage for the attendees. Much time is saved and profitability increased by paying attention to the best practices in the industry.

For more information go to www.narpm.org.

Who Needs to Sign a Property Management Agreement?

Tue, 13 Oct 2009 17:44:58 -0500

We sign up a lot of owners for our property management services. Once signed up, we check the county records to see if we have signed up the actual owner of the property.

Some of the time we sign up an owner that has a spouse who is not present at the meeting. So we just sign up that spouse and follow the directions of the person we met.

Recently this happened and then we got a call from the other spouse stating that they were getting a divorce and she wanted the rent money. My first inclination is to stop everything and wait until the two of them work it out. My backup plan is start writing owner proceeds checks in both of their names so they both must sign the checks.

Anyone got a better plan?

Creative Living Options Offers Supported Living Services

Tue, 13 Oct 2009 12:39:37 -0500

Supported Living Services What is SLS? Supported Living is an individually tailored set of services and supports designed for adults who manage developmental disabilities. People using Supported Living Services create their own lifestyles and live in homes of their own, with or without housemates, according to their choice. With the support of family, friends and agencies, they choose their activities, companions and goals, creating lives that are typical of others in their communities. They participate in their communities and work, with individualized support, toward achieving their personal goals.

If you want more information about Supported Living go to www.CreativeLivingOptions.com This agency is one of many that offers an alternative to group homes and living with parents.

Kenny Thomas of the Sacramento Kings Becomes Fan Favorite

Thu, 01 Oct 2009 01:13:30 -0500

I took my son, AJ, the one wearing the Red Sox Jersey, golfing with me this past weekend. AJ rides shotgun and drinks soda while I golf. This time we golfed with Sidney Poritz (the red shirt) who is one of our property managers (and a good one, too!) at HomePointe.

At the conclusion of our less than memorable 18 hole round, we ran into Kenny Thomas who was making the turn at Teal Bend. Well, Kenny made a huge effort to say hello, gave an autograph without being asked, and he had his golf partner take this photo.

Kenny was so friendly that he got me excited about the upcoming season. I am hoping he has a great year. Kenny is a person that is giving back which is the way it should be.

I tip my hat to Kenny for giving us a great memory.

HomePointe Upgrades Internet Servers

Thu, 24 Sep 2009 00:49:02 -0500

We have just completed moving our websites to a secure location with automatic backups. We were one of the first companies to use the internet and due to that we were self hosting. Self hosting was great while it lasted but over time it is a bit riskier having the servers to deal both from a security standpoint and maintaining the servers.

I sleep a little better knowing the sites are off my site as well as our accounting software which is internet based.

When you are selecting a property manager, find out where their data is located. If it is located in their home or office, it is subject to theft, storm, fire, etc. A disaster for your property manager could be a disaster for you!

Can The Owner Demand to Have Their Tenants Alarm Code?

Tue, 22 Sep 2009 10:13:55 -0500

The better question should be, "Does the owner want to have the alarm codes?"

My answer is an emphatic no. The landlord/owner should not be giving the tenant any reason to blame them for lost items in the tenant's rental dwelling. Having access codes will put the landlord on the short list of suspects.

If you need to get into the property, give proper notice and go in. If there is an alarm you might need to notify the police in advance where a forced entry is needed (which is very rare).

If you don't know what a proper notice is in your state, check with a property manager or the local rental housing association.

Land Park Golf Course in Beautiful Sacramento

Sun, 23 Aug 2009 11:22:45 -0500

If you have not golfed at the 9 hole Land Park Golf Course recently you should give it a try. Morton Golf has taken over the management and they have done two important things. First, they moved the tee boxes back creating 3 distance levels. Second, they are really making an effort to keep the course in top shape. The greens are very good and the fairways just as nice.

This course is short, only 1 par 5 and 3 par 3's, making it a par 34 overall. Just right for a quick drop in after work, and at about $14 for a round, the price is right too.

Nephew Goes Upside Down

Sun, 23 Aug 2009 11:12:54 -0500

I have a nephew with a young family that asked for some advice. Seems their mortgage is now upside down and their mortgage payment has increased. They wanted to know what to do.

The have tried to talk to the lender, but no response.

I told them that they have a few options. Keep going with the minimum payment, try to short sell (but if the lender will not cooperate what good is that), walk away and rent somewhere else, or stop making their payment and eventually they will be contacted.

I don't much like the last option, but the lenders have put many people into a position to consider this option in order to get the conversation going.

It is still not pretty out there, especially in California.

Tenant Wrecked the AC

Fri, 21 Aug 2009 00:17:23 -0500

I got a call this week from a do it yourself landlord. She wanted to know what she could do about a recently moved out tenant that wrecked the central air conditioner. Seems the tenant's pet used the condensor to relieve itself.

I told her to get two bids and then prorate out the life expectancy of the unit. Charge the tenant for their share of the life. Or, if it is just a repair, charge them for the whole repair cost.

Seems simple enough until the tenant complains that they did not do it.

Golf Tip In Las Vegas

Sun, 16 Aug 2009 19:51:54 -0500

I have the opportunity this weekend to play golf in Las Vegas. I paid just over $150.00 to play at Bali Hai on the south end of the strip. It is a luxury course but the greens to pretty sandy and rough. The next day we played at Desert Pines and it was a real treat at $99. Beautiful fairways and greens, very narrow at tmes.

Both of these courses are a little short, but you can play the championship tees and make it reasonably long.

If I could only play one course it would be Desert Pines.

Note: These courses are related and if you play Desert Pines you get a 20% discount at Bali Hai.

Happy Golfing!

Don't Use Your Driver If You Cannot Control It

Sat, 08 Aug 2009 00:14:00 -0500

I played golf this morning with a young fellow who can kill the ball with this driver, 3 wood, and irons. On the first par 4 he pulled out a 3 wood to take to the tee box. I know him to be very aggressive in both business and sports so I was surprised to see his club selection.

I asked him about his choice to downsize his club. He replied that he had been playing golf for a long time and had come to realize that he scored better when using the 3 wood on par 4's. He only used his driver on par 5's.

I thought about this and told him that he should take that approach to his job as a property manager. Instead of taking the aggressive approach to problems, find out through trial and error what works best and use that tactic. Maybe it is calling a late paying tenant before serving a notice. Or maybe getting another opinion on a repair issue rather than taking the quick first bid.

I noted that on the first par 5 we played this morning, my young golf parter used his driver and hit his ball into a big tree on the right. That was no surprise!

HomePointe Installs Appfolio Software

Thu, 06 Aug 2009 00:45:20 -0500

We chose Appfolio as our software solution for several reasons.

First, we wanted a program that could handle our current portfolio of 2,000 tenants consisting of single family, apartments, and commercial properties.

Second, we wanted a web based program. Web based means no more backing up issues (Appfolio does it), no hard drive failures, no network issues, and consistent program availability for our three offices and for onsite staff. We can also use the program at home or on the road.

Third, Appfolio has an accounting program that is both understandable, foolproof, and consistent with trust accounting requirements.

Fourth, we are convinced the Appfolio is committed to providing an ever improving program.

Fifth, we are serious about reducing our use of paper and Appfolio is a great vehicle for both going green and saving money doing it.

Finally, Appfolio was able to migrate all our Yardi Enterprise data which was important for us. We have a large database and being able to bring all our data into Appfolio is a huge advantage.

We are still learning the program but we are confident that Appfolio gives us a competitive advantage over our competition as well as increased productivity. The whole idea is to give our customers the information they want and provide our staff a tool to get that information to them on a timely basis. Appfolio helps make achieving that mission month in month out a reality.

Rental Market Remains Strong in Sacramento

Mon, 03 Aug 2009 00:24:27 -0500

Our 3d Quarter 2009 Residential Rental Survey is now available. You can access this survey at our website along with past surveys by clicking this link: HomePointe Surveys .

You get on our Quarterly Email List at your request. Email me at rmachado@HomePointe.com and I will add you.

The rental market remains healthy despite high unemployment and furlough days here in the Sacramento area. It seems many people are downsizing and certainly are not purchasing in great numbers. They have to live somewhere and rentals are the option that makes the most sense. Sales are strong at the bottom end and this is due to entry level buyers and investors grabbing the lower prices. If you own a rental, hang on to it if you can. Investors that are upside down are still letting theirs go, keeping the foreclosure pipeline alive.

Foreclosure Activity Seems to be Abating

Mon, 03 Aug 2009 00:17:20 -0500

We have noted that in the last 45 days fewer of our clients are letting their investment homes go into foreclosure. This is mirroring what I am reading in the Sacramento Bee and Wall Street Journal. We may well have hit bottom or at least taking a breather.

I suspect that most of the upside down owners have already let their homes go leaving the rest of us that have owned for longer periods.

It is noteworthy that the low end is experiencing mulitple offers and price bidding wars. Things are looking up for a change! We are also seeing a steady stream of investors needing their homes rented.