Thomas R. Martin- Broker/Owner, ICPM, Property Manager in Sacramento, Folsom, Natomas, Elk Grove, Roseville, Property Manager's Blog

It Pays to Keep an Eye Out For Better Technology~

Thu, 17 Sep 2009 08:30:26 -0700

I did not think I was in the market for a new laser printer, but during a recent shopping trip to Costco, I decided to purchase a new HP Officejet 6500 Wireless Printer/Copier/Scanner/Fax. I have a 6300 model from HP that has been a little workhorse for our small, service-based property management company over the past 3 years, but it always had a drawback- the toner cost. The toner cartridges cost about $40 each, or I can get a combo pack at Costco with 2 black and 1 color cartridge for $75.00, not a bad deal at first glance. The printer itself cost me $225, but I was noticing that the toner costs were really outrageous. What really tipped the scales and convinced me to buy a new printer? Several things actually: 1. Technology is getting better AND cheaper, so my new hardware cost a whopping $139.99, almost half the cost of the old machine. 2. Efficiency: The new Officejet offers an XL toner cartridge that can handle an estimated 1200 copies before it needs changing. The old 6300 model (per manufacturer specs) can handle about 400 copies before it is screaming for a refill cartridge. The XL toner cartridges cost about $68 each, but if they truly perform 3x better than the old ones, this machine is going to save us hundreds of dollars per month in toner costs. 3. Energy: The Officejet 6500 is an energy star rated piece of hardware, and features a sleep mode when it is sitting idle, something the old 6300 model did not do.Wireless is also thrown in for networking, though I use mine as a hardwired system only. I used to always be a "don't fix it if it isn't broken" kind of guy, but I am definitely seeing the benefits of keeping an eye out for technological advances, both to improve our small company as well as to always strive to improve on our already fine tradition of customer service-based Property Management. Investors Choice Property Management (ICPM) manages 105 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

When Fiduciary Duty, Honesty & Fair Dealing Collide- Always Err on The Side of Doing What is Right~

Thu, 20 Aug 2009 06:11:55 -0700

As a small Sacramento-based property manager for the past 16+ years, we have had the privilege to work with some of the very best Landlords in the area, from 1st time investors to seasoned real-estate professionals, people are coming (and staying) with our services due to a simple but stringent governing principle- We say what we do, then we actually do what we say. Our business is mostly word-of-mouth and the feedback has been overwhelmingly good. Our clients enjoy personalized services customized to their individual needs, grounded in the knowledge that they have first-hand access to a licensed Broker, without having to deal with various departments and other roadblocks. As agents for our Landlord clients, we have a fiduciary responsibility to act in their best interests. We also have an obligation to everyone else we deal with to be honest and fair. Recently, these concepts collided with the move-out of a tenant from one of our rentals. Our ex-tenants, Mr. & Mrs. "Jones" (No one knows why the Smiths and Jones' get all the bad press), moved from a condo we manage in Roseville after a 12 month lease. As always, we documented their move in and move out with digital photos to protect our Landlord client's interests. As part of the move-out process, the Jones' requested and were granted a pre-move out inspection, wherein we inspected the property and noted any deficiencies needing correction in order to maximize the security deposit refund, up to 100%. Overall, the walk-through went well, though we did note that the carpet needed cleaning, 2 smoke alarm batteries were missing and the furnace filter needed changing. otherwise, the tenants did an admirable job of keeping up the rental over their lease. The tenant had a history of being argumentative, and was loudly critical of our findings during the inspection, but that is just an unfortunate part of the job our clients pay us to do. The owner inspected the property after vacancy, and emailed us to breakdown the charges they would be assessing the ex-tenants- charges which did not align with our inspection results. Among the erroneous charges were fees to remove stains in the carpet, replace a broken mini-blind, and dismantle a large plywood cabinet in the garage. It was fortunate for the ex-tenant that we maintained accurate digital photos showing all of the pre-existing conditions at the rental, including the ones above that our client was planning on charging the ex-tenant for. I had to bring this up because it is one of those "behind the scenes" incidents that the ex-tenant will never know about nor appreciate, how we defended his deposit and had to stand up to our own client, erring on the side of what was honest and fair, rather than go along with what could be "gotten away with". At the end of the day, we'll likely lose a client over our principles, but it is a small price to pay to keep one's integrity intact. Investors Choice Property Management (ICPM) manages 105 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Predictions for the Rental Market Heading into Fall 2009

Wed, 19 Aug 2009 09:47:23 -0700

It has been an eventful year of foreclosures and short-sales, but don't start thinking we are out of the woods yet. The government's moratorium on foreclosures is due to lift August 31, 2009. As a small property management company that can often rent to people facing foreclosure, we are looking forward to what we think will be a brief respite from government intervention in our market. No one can say for certain, but I'll venture to speculate on the immediate future of our rental market- It is going to get a little better in short order as the banks rush to push through as many foreclosures as possible through the system before the government stomps on the brakes again. I would predict the next moratorium gets put into place by November 1, or the 15th at latest. This should translate to an unseasonably busy September/October as the next wave of foreclosures hits the market, followed by a surge of new rental vacancy (to go with the abundance of vacant inventory we have already) as the REO's are bought up by speculative investors and returned to the market as rentals. There are differing opinions on the effectiveness of government intervention in the real estate industry, but I think it is pretty safe to say that intervention got us into the current mess, and we know whom to thank for that. Do we really trust the same people to get us out of this? Investors Choice Property Management (ICPM) manages 105 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Landlord/Tenant Relations in Property Management- The 4 Types~

Sat, 15 Aug 2009 04:54:47 -0700

As a professional residential property manager these past 16+ years, I have had my fair share of challenging scenarios. Most scenarios involving Landlord/Tenant relations fall into 4 possible categories: 1. Good Landlord/Good Tenant- My favorite scenario, and by far the most rewarding one to work with. The Landlord recognizes their responsibilities to the Tenant and the property, while the Tenant fully understands and adheres to the terms of the lease agreement. 2. Good Landlord/Bad Tenant- I would say I hate to work with these scenarios, but they tend to be a significant part of new incoming business (Client placed a tenant themselves and now needs our help to straighten them out or evict them and start over). 3. Bad Landlord/Good Tenant- Almost as bad as you can get, here you have a Tenant that is adhering to the rental terms, while the Landlord does not keep up his/her end of the deal. These scenarios tend to be short-lived in our business, as i find that I have less and less patience with clients that refuse to keep up their properties. 4. Bad Landlord/Bad Tenant- A rare situation indeed, where on one hand you have an uncooperative hostile tenant, while on the other a perpetually irate client that seems to always be questioning why they are paying us to make their life miserable (bothering them with repair requests and other expenditures, etc.). If you have a property management question, we are always happy to lend some support. Investors Choice Property Management (ICPM) manages 105 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Landlord's Learning Center- Cutting Your Losses- Evict Sooner Rather Than Later

Wed, 13 May 2009 12:34:35 -0700

Unlawful Detainer Actions (Evictions being the more commonly used term) are an unfortunate part of the Property Manager's job, and one that we hate to have to perform. In situations like these, the best that can be hoped for is a quick turnover with a minimum of damage, so here are a few pointers if you are a Landlord facing a possible Eviction with your tenant: 1. Do NOT make it personal. I have found over the past 16+ years as a property manager that the best approach one can take is a "sorrowful" one. As a Landlord, you are "sorry" that this situation has resulted in legal action, and while you can sympathize with your tenant's position (even if you can't, you pretend to), they have left you no other choice but to proceed with Eviction. Whatever small satisfaction one might derive from letting the tenant know in no uncertain terms "exactly" what you are thinking about them is nothing compared to the kind of property damage a vindictive tenant can do to your home. Keep it simple and professional, but take no personal satisfaction in doing (or at least try not to let it show). 2. Do NOT stall. We recently advised an owner client that he should let us commence Eviction proceedings against his non-paying tenant on April 7, 2009. At that time, the tenant owed April rent. Contrary to our advice, the owner tried to "work it out" with the tenant, and made a verbal agreement to let them stay until May 10, 2009. Here we are at May 13 with no rent and a non-paying tenant STILL in the property. 3. Count the costs, then cut your losses. Our client's main reason for avoiding the Eviction route was cost. He did not want to pay the $675 in attorney fees, court costs and sheriff's fees to get the tenant out. However, I pointed out to him again today that at $1150 per month (the current rent), the tenant is "in our owner's pocket" for $1650 with no end in sight because no legal action has been taken. Had the client acted on our recommendation, the tenant would likely have been shown to the curb by the sheriff by now. 4. Get Eviction Protection if it is offered. Many property management companies (ICPM being one of them) offer Eviction protection programs where, for a nominal monthly fee (ours is $10), the property management company will cover the legal costs to evict a problem tenant (subject to certain circumstances covered in the management agreement). Have a question about rental management, landlord-tenant relations, or just want to find out more? We welcome your questions. ICPM is a small, service-oriented property management company for discerning investors looking for "a bit more" than they are used to getting from property management. Our business is over 95% word-of-mouth referral, we do NO sales, and property management is our only business. Find out what we mean when we say: "Experience Property Management The Way it Should Be." Thomas R. Martin Broker/Owner, ICPM (916) 770-9707 Work (916) 722-2121 FAX www.investorschoicepm.com

"The Ballast Banshee" From Our Archive Entitled ~Tenant Tales of Terror~

Tue, 12 May 2009 02:40:57 -0700

As a professional property manager since 1992, I have my fair share of odd stories that have stuck with me over the years. Here is one of my favorites: I had occasion to call Ms. Parker (name changed to protect the slightly deranged) during the summer of 1995 after I noticed her lawn was looking unkempt during a routine drive-by inspection. "You have to get your lawn mowed, or your rent will be increased to pay for gardening", I explained. She did not miss a beat, replying "I am NOT going to risk catching AIDS from a mosquito, so do what you gotta do!" Ironically, in 2008 we were getting the same occasional complaints about West Nile, but that is another story. "While I got you...you need to send out someone to arrest the man staying in my attic!". Now, I should point out that I already knew Ms. Parker was, shall we say, a little eccentric."Why do you think someone is in your attic?" I asked. "Well, my kitchen lights flicker, so that must be from him walking around." I am shaking my head at this point. She continued- "And he stole from me...I was making lunch and had my chicken on the kitchen counter, and when I went to the bathroom, he came down and stole it!"."He must be using the attic as a bathroom, because my kitchen smells awful!" In the end, we sent out the ghost busters (aka: our contractor) who discovered and corrected the problems. The kitchen ballast was bad, causing the lights to flicker. And the smell? Yes, her chicken had fallen off the kitchen counter and fell between the cupboard and refrigerator, where it proceeded to rot over the next 2 weeks until discovery. True story. Does this mean I get to list "paranormal experience" on my resume?

My Tenant Has Never Heard of "Small Nails", and It Cost Them...

Sun, 10 May 2009 04:06:00 -0700

We just pulled off a small miracle this week. Our tenants moved out of their home on Tuesday, we had the home painted Wednesday, cleaned Thursday, carpets cleaned Friday, and new tenants moved in Saturday morning. Even for professional property management, that is a pretty tight turnover. What should have been a very easy turnover was complicated by our ex-tenants use of anchor, or "molly" bolts. While it was evident that the home they lived in was kept quite nice over the past 18 months, we did not know the damage that was hiding under every wall hanging. The walls of our 2400sf 4-bedroom home were studded with molly bolts, at least 3 on EVERY wall. Molly bolts are typically used to mount heavy wall hangings (mirrors, etc.). Our tenants used them to hang calendars, 5x8 picture frames, you name it. New paint is based on a 3-year lifespan, so we could only charge the ex-tenant for 50% of the touch-up paint cost. However, we maintain that any hole larger than a nail hole is treated as wall damage, and is therefore considered beyond normal wear and tear. As we dug deeper into the move out condition, it was clear there were more hidden surprises in store. The ex tenants made off with all 6 smoke alarm batteries, the garage remote batteries, half the light bulbs, and a host of other items that would be easy to miss if we were not being so thorough. Comprehensive inspections are vital at both move-in and upon vacancy, to insure that the Landlord's interests are protected, as well as to maintain a policy of honesty and fair dealing with the Tenants.

Thank Goodness, The Tenants Are Coming (and Staying) with ICPM

Fri, 08 May 2009 13:41:42 -0700

We are seeing a definite increase in call volume for all of our vacant rentals, as if someone turned on an imaginary switch somewhere. What started as a fairly slow week has turned into a dash to screen applicants, as we now have 6 vacancies ready to rent with applications on almost everything. We continue to receive good positive feedback from applicants, telling us (without exception) that our rentals are far and away the cleanest and most well-maintained they have seen. After 16+ years in the business of property management, I have seen what passes for "habitable" in some landlord's minds, and it is not good. At ICPM, we pride ourselves on the services we provide, and not just to our owner clients. Today's tenants are tomorrow's landlords, so we treat our tenants with the respect and courtesy they deserve. Our approach has paid off- we have had tenants go on to become landlords needing our exceptional services. We have had many tenants opt to negotiate renewal leases, saving our owners thousands of dollars in vacancy loss and turnover costs. Happy tenants take better care of our clients' homes. Take care of your tenant, and they will take care of you. Thomas R. Martin Broker/Owner, ICPM (916) 770-9707 Work (916) 722-2121 FAX tmartin@investorschoicepm.com

Good, Better, or Best? Which Do You Think Your Clients Prefer?

Thu, 07 May 2009 11:36:35 -0700

As a property manager in the greater Sacramento area, we are often compared to other companies with differing philosophies on just how the job should be done. With over 16 years of management experience, I have had some time to consider how we want to be identified in the marketplace, so I have taken measured steps to insure our services meet or exceed our client's expectations. To demonstrate what I mean, we'll use a little excercise we like to call "Good, Better or Best" in relation to various aspects of property management and how different companies handle those aspects. Here goes... Management Contracts: Good: Clients have the option to sign a 6 or 12 month contract for services, but pay no management fee during an initial vacancy. Better: Clients have the option to sign a month-to-month contract providing flexibility, and pay no management fees during initial vacancy. Best: Clients sign a flexible month-to-month management agreement, pay NO management fees during initial vacancy and NO fees during subsequent vacancies longer than 30 days. Maintenance Services: Good: Property Manager will coordinate maintenance on an ongoing basis, with little or no involvement from landlord as they have the ability to spend substantial amounts of rental revenue without landlord approval. Maintenance is usually marked up and provides an additional profit center for the management company. Better: Property Manager will coordinate all maintenance both during and after business hours, with some limitation on the amount of money that can be spent without securing landlord approval. Best: Property Management Broker will personally monitor maintenance 24/7 and follow Landlord's specific instructions for each property, using management's vendors or Landlord's own vendors as directed, all with absolutely zero markup on any repair or maintenance item, insuring an impartial and unbiased assessment of all maintenance related issues, eliminating an inherent conflict of interests. Vacancy Marketing/Showing: Good: Property Manager or leasing agent shows 7 days per week and advertises on the Internet as well as newspaper and signage. Better: Property Manager continually re-evaluates the market, giving weekly updates to all vacant property owners and negotiating rental adjustments to stimulate activity where and when appropriate. Best: Property Management Broker personally re-posts web ads every Monday, Wednesday and Friday to keep vacancy postings on the top, middle and bottom of the Craigslist listing, personally monitors and usually attends most showings to witness the applicants' response and to evaluate the overall quality of the vacancy, curb appeal, etc. and personally updates each vacant property owner on at least a weekly basis until rented. Investors Choice Property Management (ICPM) is proud to say we meet or exceed the examples of "best" given above, as our niche market values consistent quality over mere portfolio size, and client retention over "revolving door" growth. If you or someone you know is interested in finding out more about our services or our exceptional referral program, don't hesitate to give us a call or email. We are the cure for the common property management company.Visit us online at www.investorschoicepm.com, and find out what we mean when we say: "Experience Property Management The Way it Should Be." Thomas R. Martin Broker/Owner, ICPM (916) 770-9707 Work (916) 722-2121 FAX tmartin@investorschoicepm.com

2nd Generation Referrals- The Mark of a Job Well Done~

Wed, 06 May 2009 13:01:33 -0700

The market is right for buyers out there and we are reaping the benefits of providing exemplary service through the acquisition of new accounts via referral. These are not just any referrals. Instead, they are our absolutely favorite kind of new business- 2nd generation referrals. In just the last 2 months, a former tenant of ours went on to become an investment property owner and signed up their rental with us in Antelope. Their reason? They stated: "We remembered how thorough you were on qualifying us for the rental, and how responsive you were throughout our tenancy, so we could think of no one better suited to manage our first rental." Fancy slogans and marketing dollars aside, nothing tops an earnest compliment for hard work done properly. This month, we have two 2nd generation referrals. One was from an owner that referred his best friend (after a flawless 2 years of property management), the other from a father referring his daughter's first rental. I can't decide which makes us happier, knowing that we provide the kind of service that has our clients referring their own friends and family, or the thought that one day we just might manage for our owner's grandchildren. It's times like this when you know your doing things right. In today's fast-paced industry, when everyone is trying to work smarter, it is good to know there are rewards to be had from simply working harder. To all of our supporters, from referring agents and top selling professionals, to each and every client that believed in management "the way it should be", to every vendor that gives our clients the quality service they've come to expect at prices they can afford, we say thank you. Investors Choice Property Management (ICPM) is a small, service-based property management company serving the greater Sacramento and surrounding area. Our business is over 95% word-of-mouth, we do absolutely NO SALES, and pay among the highest referral fees available for management accounts. We charge NO MARKUP on any repairs, and believe in complete transparency with the public, as our services, fee structure and contracts are available online at our website www.investorschoicepm.com. ICPM is a proud member of NARPM (National Association of Residential Property Managers), as well as an honored affiliate of the SAR (Sacramento Association of Realtors). Stop getting lost in the shuffle or treated like an account number, and get ready to... Experience Property Management The Way it Should Be.

Never Settle for "Good Enough"

Tue, 31 Mar 2009 12:35:23 -0700

As I sign up our latest new client, I pause to reflect on why they chose our company over our larger competitors. Month after month, our advertising budget is dwarfed by the monstrous amount of marketing money spent by larger companies, yet time and time again we come away with the new account after careful comparison of services and fee structures. But it is more than that... In the end it was our old mainstay, customer service, that won the day on this occasion. The client, an investor with a home in West Sacramento, called around to several companies, yet ours was the only one to respond in 2 hours or less, standard policy for us. We booked the appointment right away for the weekend, and had the sign in the ground with pictures on the web in less than 24 hours. Monday night we got an after hours call- it was our new client. They had come to town to perform some minor maintenance at the property and had forgotten their key. We answered the phone at 9:30pm and provided them access via our lock box, providing a little extra service while cementing the relationship with the knowledge that they made the right choice for their property management needs. It was another good day. I enjoy providing personalized services to our clients, while ruining them for any future "cookie cutter" company with generic policies and procedures. I have heard the saying before "we must be doing something right, because look how many homes we manage". It begs the question "yes, but how well do you manage?" Everyone measures their success differently- some by the number of zeroes on their paycheck, others by the quantity of business they generate. At ICPM, we measure our success by the quality of the business we run each and every day for our 112 satisfied customers and their well-qualified tenants. In my opinion, if you take care of EACH and EVERY ONE of your clients and treat them with the courtesy, diligence and respect they deserve, the money is incidental. Investors Choice Property Management (ICPM) manages 112 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

2009...The Year of Hope and Change...What Exactly Does That Mean???

Thu, 19 Mar 2009 12:07:10 -0700

I put it off as long as I could...the appointment with my CPA looms large on the horizon, only 10 days to go. I know it is going to be bad..I just do not know exactly how bad. Unfortunately, I am pretty good with math, so I cannot delude myself with false consolations, telling myself "it'll all work out just fine". Funny, when I was in my 20's, $100,000 seemed like such a large amount of money. Now staring down the tail end of 41, it all looks quite different. We have a small property management company, nothing large by Sacramento standards, only 110 properties. We managed to earn just over $100,000 in 2008, but running a business like ours costs money. $8000 paid out in agent referral fees, $3000 in advertising, phone bill, office rent, property tax, business licensing, office supplies, software, hardware, it all adds up to about $30,000 in expenses. Still, if my math is accurate (and it usually is), we are looking at a tax bill of about $13,000. $13,000?!?!? Why do I feel like I am working for the government? Year of "Hope & Change"? Translation: This year, I "Hope" I still have "Change" left in my pocket when uncle Sam gets done with me. I know what my CPA will say...time to buy a rental or two. Odd how we are often raised to save our money, yet as a society we punish such behavior. The only way to really acquire any real wealth is to be leveraged to the hilt, cash poor and property rich. Well...I am ready. Sign me up.

Housing Slump Means Industry-Wide Slowdown, But Small Businesses Survive

Tue, 17 Mar 2009 12:00:08 -0700

As a small, service based property management company serving the greater Sacramento area, we are often asked how our company is doing during these uncertain economic times. While our new client acquisitions are somewhat lacking, they really are not doing any worse than same time last year. We continue to receive inquiries from prospective new clients, but most are looking for services to start in the late Spring or early Summer. Historically, property management not only does well in a down sales market, it thrives. However, this market has impacted more than just the sales prices of homes, so we are experiencing some of the secondary effects. Fortunately, we have not lost a single tenant due to layoff or owner due to foreclosure (knocking on wood). Our small account base (110 units) remains solid despite the slowdowns we see all around us. It is during times like these that I am thankful we chose to remain small and focused. I would never want to be in the position of having to cut someones pay or lay them off because the company's revenue could no longer support them. Our referral program remains intact and is perhaps our most successful marketing tool. Because we do no sales, we are able to secure referrals from competing sales offices. We pay a $400 referral fee per client, and agree to refer that client back to the agent that sent them to us for any future buying or selling they wish to do. Recently, an owner of ours asked us for a recommendation on a sales agent, forgetting that an agent had referred them to us. We saved the listing for the referring agent by sending his former client back to his doorstep, over 1.5 years after the initial referral to us. With one call, this agent secured a vital service for his client, earned a $400 referral, while building a base of future sales leads. If you or someone you know has questions about property management, we are always happy to lend an ear. Investors Choice Property Management (ICPM) manages 110 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Franchise Tax Board Delays Implementation of Lousy Tax Law- Gone For Now But Look Out in 2010~

Sun, 15 Mar 2009 06:32:47 -0700

The FTB has agreed to use 2009 as an educational year to get ready for full compliance in 2010. While this decision comes as a relief to small business owners like me, it is short-lived as we will be facing this issue again in 2010. Property Managers for out of state owners earning more than $1500 in a calendar year are required to remit 7% of net proceeds to the state on a quarterly basis. Unless we see shift in the political winds later this year, we will take steps to protect our clients from the effects of this tax code revision as best we can. So far, the 2 best options on the table for avoiding the withholding are as follows: 1. Set up the tenant to pay the rent direct to the owner, and have the owner establish a reserve to pay for management and maintenance costs. 2. Set up the owner's account to pay all home-related expenses (mortgage, utilities, etc.) so that the net proceeds to owner is less than $1500 per year (no withholding required). Investors Choice Property Management (ICPM) manages 110 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Landlord's Learning Center- The Perilous Pitfalls of Renting to Friends and Co-Workers

Sun, 15 Mar 2009 06:03:53 -0700

Recently an unhappy applicant posted their thoughts in a comment on our blog, so we thought it best to touch on an important subject that has or will impact many landlords- the decision to rent to a friend or co-worker. Applicants Mr. & Mrs. "Smith" submitted applications to rent a home of ours in Elk Grove. Mr. "Smith" was a co-worker/friend of the owner, so certain concessions that would not normally be allowed were approved by the owner in order to make the move-in go as easy as possible on the applicants. The rent was reduced along with the pet deposit, and 4 month financing was approved to pay off the security deposit. From the onset, we felt that our clients were being taken advantage of, in that the applicants were already getting a home at a serious discount, along with generous financing terms on the security deposit, pet deposit, etc., yet they neither acknowledged nor appreciated any of the concessions they were being given. In the end, they were unable to come up with the move in money in a reasonable period of time and were subsequently rejected. Fortunately, we were able to secure well-qualified applicants (with no pets, a higher rent, and no financing issues) within a very reasonable period of time.We harbor no ill-will to the "Smiths", though it was plain to see they took the news of their rejection for the property very poorly. Hopefully they found a suitable home and a landlord willing to work with their unique situation. When considering a friend or co-worker as a tenant, it is important to establish clear boundaries so the lines between the business relationship (landlord/tenant) does not blur with the personal relationship (friend/co-worker). This is an area where property management can really come in handy. As property managers, we are paid to look past the personal relationship and make decisions for the long-term health of our clients' investments. In over 16 years as a property manager, I have been called upon to evict my fair share of problem tenants. It is an unfortunate truth that many new clients that come to us for service after trying to self-manage fit a standard profile- they thought they could do it themselves, they thought their friend/relative/co-worker would make a great tenant, and they found out the hard way that it was not the case. Investors Choice Property Management (ICPM) manages 110 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Get Your Greedy Hands Out of My Clients' Pockets! CA's Misguided Attempts at Securing More Revenue~

Sun, 08 Mar 2009 05:04:16 -0700

3 down, 8 to go. 11 clients and approximately $1000/month in income is at stake, not monumental but significant for a small property management company like ours. CA Franchise Tax Board has been playing around with the tax code, and it looks like our industry is next in line for their wrath. The Franchise Tax Board enacted a revision to the tax code in February, retroactive to 1/1/09, making it the property manager's responsibility to withhold and remit 7% of rental payments sent to owners that reside out-of-state, and even more for those outside the U.S. Because there was little notice, there was no way to avoid this train wreck of a new law from affecting our clients. The withholding rule only applies once the landlord has earned $1500 in a calendar year, so it is awfully convenient that they passed the law in February retroactive to 1/1/09. Had we known about this last year, we could have taken steps to protect our clients from it's effects. Like any new tax rule, this one has loopholes. The biggest of which- if the tenant pays rent direct to the landlord, no withholding is required. Great- now when we call our clients to tell them we are holding back 7% of their money, all they have to do to get out of further withholding is fire their property manager. So far, no one has taken that option, as they still recognize the importance of having someone local to address regular maintenance as well as emergencies. The other loophole still adds significant work to our task list. If we pay all home related expenses (mortgage, utilities, property taxes, etc.) then we only have to remit 7% of what is left, and 7% of nothing is still nothing. In the interest of keeping our 11 out-of-state clients happy, we are offering free "bill-pay" for all home-related expenses. Anything we can legally do to keep our clients' money out of the hands of people that will only waste it (because isn't that what we've seen them do for years?) is worth the effort, in our opinion. 3 out of 11 clients have made the decision to stay with our company despite the new law. The remaining 8 are weighing their options, but we expect to lose at least 1-3 clients over this. It is going to be an interesting month.

Shattering the Stereotype- Property Management is a 24-Hour/Day Job~

Sun, 01 Mar 2009 04:43:59 -0800

Another rainy weekend here in Sacramento. The weekend was, by all accounts, supposed to be slow. My friends and family have this picture in their minds of property managers like me- usually it involves sitting with my feet up on a desk, greedily counting the rent money as it flows in, effortlessly and never-ending. If only that were the case....believe me, it's not. Property Management can and does have it's perks- we are not as dependent on a good sales market and typically thrive in a downward cycle, though we do feel the economic pinch when our owners and tenants are laid off. We do not make the big commissions like our sales brethren, sacrificing the "feast or famine" pay scale in favor of a slower, steadier and more stable (usually) business model. We certainly do get our surprises, however. This weekend was "supposed" to be slow. So far, we have handled 1 unscheduled move in (in order to accomodate a tenant that was being forced out of their previous rental due to foreclosure on the landlord), 2 emergency calls for heat and plumbing, and 1 unscheduled move out wherein a tenant (an inherited tenant that we did not place) was in the process of being deported, leaving the rental unit open and unattended. Being a property manager means staying flexible, able to respond quickly and effectively regardless of the timing or situation. We were able to gain entry to the unit today, lock the unit to prevent further damages, and turned off the water to stop a leak that was costing the landlord money. The locksmith has been called to change locks, and our contractor will be there tomorrow to commence turnover repairs. This unit will be rent-ready again before this Friday. A lot can and does happen over the weekend. If you employ a property manager, thank him or her for being on call 24/7. Ours is a complicated profession, not understood by many for the tangled web of responsibilities that it truly is. Investors Choice Property Management (ICPM) manages 110 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Voicemail is Great...But Nothing Beats the Personal Touch and Novel Approach of Answering the Phone~

Sat, 28 Feb 2009 02:50:21 -0800

We did it again. For the.....(pause while counting).....let's say "umpteenth" time, we managed to secure a fantastic applicant on one of our homes, even though ours was one of a dozen homes these people were calling on and we were NOT the cheapest rental. How did we get the applicant over our competitors on Craigslist...what's our secret? It is nothing special, yet in this age of automation where everyone is so dependent on voice mail, perhaps it is somewhat unique. We answer the call. In this case, the caller was transferring here from the Bay Area, called on at least 12 other ads within the previous 24 hours, yet ours was the only company they could get through to, or get a call back from within 2 hours or less. On this particular day (yesterday), we took the call live, scheduled the showing within the hour, met the applicants, collected their applications, and had them approved for tenancy this morning. Yes, this morning. That is secret #2- we work when there is work to do. We are one of the very few property management companies that will show and process move-ins on the weekend, to be as accommodating as possible for our incoming tenants. This is just one area where personal, professional property management can really make the difference in a highly competitive market. We have consistently leased properties through superior service, shorter callback times and more flexible appointment scheduling. I'd blog more, but have to get on the road. It is Saturday morning and we have a move-in to do for yet another satisfied client. Investors Choice Property Management (ICPM) manages 110 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Internet Is Great For Home-Hunters, But Beware Of Scams~

Fri, 27 Feb 2009 10:18:57 -0800

We caught another clone-scammer today. They had stolen one of our digital photos posted on Craigslist and duplicated our ad. 2 people reported getting responses back from what they thought was a landlord, asking them to send an application and "good faith" deposit. It is amazing how many cheats there are out there, but here a few tips for spotting them before they make a victim out of you: 1. Never rent a property unseen. Walk through the property with an agent, and get a business card. 2. Never place your trust in someone just because they "sound nice". 3. Scammers will often invoke religious undertones (we need to rent the home quickly because we are leaving to do missionary work). That is not to say everyone that mentions religion or god is a bad person, but it is often used as a tool to gain trust, so beware. 4. If a deal sounds too good to be true, it is. The clone scammer that we caught under priced our ad by $300, advertising a $1300 home for $1000. 5. Make sure the person you are dealing with is a legitimate party. Title companies can look up registered owners, as can many management companies (including ours). Check out property managers on the Department of Real Estate Website, or check local resources (citysearch.com, yelp.com, etc.). We will never do away with all the scammers, but we can be better about identifying them. Good luck and safe web-browsing.

State of CA wants Property Managers to Act as TAX COLLECTORS

Thu, 26 Feb 2009 03:56:24 -0800

Has anyone else heard about this? The Franchise Tax Board has decided to revise a tax law effective 1/2009 making it a property manager's responsibility to collect and remit 7% of rents collected out-of-state landlords. While there is some ambiguity in the explanation of the law as it pertains to residential tenants vs. commercial tenants, we are faced with a serious problem in that the law has one obvious loophole: If a landlord fires their property manager and collects the rent directly from the tenant, no withholding is required. Fortunately, we are a small company that would only feel these effects on about 1 dozen clients, but that is still a significant loss. In our state's misguided efforts to fill coffers, they are dealing a serious blow to small business owners like us that will not be the legislature's tax collecting puppet. Currently we are researching this issue (gathering info from the CA Apt. Assoc., CPAs, etc.) and will report back on any findings. In the meantime, if anyone out there has useful info on this, please do share it.

The Mystery of The Mauled Birch Tree

Tue, 24 Feb 2009 12:59:25 -0800

We have a small Sacramento-based management company serving the greater Sacramento region. I have been a property manager for over 16 years now (I started at 24, and am told 41 is young in property manager years). I love the variation that every day brings. New challenges, new laws to work with every year, it is anything but dull. I am 3 days away from renting a home near Elk Grove. It has been a trying market out there, but we managed to find a well qualified tenant that is ready to move in. I went to the home yesterday just to check up on things, and what do I find? Someone has stuffed at least one half of a tree worth of large limbs into our green-waste can. Sounds simple? It's not. The limbs are birch, very distinct, yet not one neighbor has a butchered stump from a birch tree in their yards to speak of. Not only that, we are talking about a neighborhood where the trees are too small to generate limbs the size of which were dumped in our can. The owner does not want to pay the $75-100 hauling fee to remove them. Here is a theory I am looking into: Our ex-tenant purchased a home about 1/2 a mile south of this rental. I am headed over there tomorrow during my pre-move in walk through to see if they have a mauled Birch tree in their yard. Here's the question for those that like these legal what ifs....if I spy an appropriately sized Birch tree with obvious recent chopping done, then I photograph their tree and the tree limbs left in our can, could I make a convincing argument to charge the cost of removing the branches from their security deposit, even though these "damages" occurred at least 2 weeks after possession was surrendered? Anyone know the answer? I suspect I do, and the words "circumstantial" and "coincidental" come to mind, but I hate to let something like this go. If harm is done to one of my clients, those responsible should be held accountable. Justice for all, etc. etc. Investors Choice Property Management (ICPM) manages 110 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Fair Housing- Does Anybody Still Not Understand This?

Mon, 23 Feb 2009 12:59:19 -0800

As a small, service based property management company serving the greater Sacramento area, we are always mindful of our clients' wishes, except to the extent when a client's wishes are in conflict with anti-discrimination laws. Frankly, I am surprised just how often the question comes up, so we'll ask it again here: How much say does the landlord have in the placement of the tenant? The answer: It depends. If the tenant is being placed within a bedroom in the landlords home AND the landlord is still occupying the home while a portion of it is being rented (a sublet), then the owner can make the call as to whom he or she would like to rent to (i.e. man/woman/single/married/etc.) However, if the rental dwelling is being offered on the market for lease or rent (not a sublet), federal fair housing laws apply. Recently an owner client called to state she "really liked the couple that viewed the home last week, but did not want to rent to them because they have 4 children". I was quick to inform the client that she could not make such a distinction, that health and safety codes permitted up to 2 persons per bedroom +1, so a 4 bedroom home conceivably could accommodate up to 9 people. It looks like we'll lose a client over our insistance to comply with fair housing laws, but that is preferable to a fair housing complaint. Investors Choice Property Management (ICPM) manages 110 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Fixing The Market- One Broker's Opinion~

Sun, 22 Feb 2009 05:39:39 -0800

As a property management company, we work with people facing foreclosure to find suitable rentals they can qualify for. This used to provide us with a steady stream of recently foreclosed applicants looking for good quality rental homes. Lately, the supply of these applicants appears to have dwindled. I suspect the reason has to do with our government and their stimulus package. I say "their" as I certainly did not vote for it, nor do I think it is going to be good for the market. In the last month, I have spoken with at least 6 people that stated they were remaining in their homes, not making mortgage payments for 6 months or more, and their bank had not even called them about it. These people are clinging to the hope that our government will ride in on a white horse, forcing the evil bank to forgive the past due balance on the loan, while slashing the principal balance and saving the homeowner forever, happily ever after, etc. If the government would just get out of the way and stop giving false hope and empty promises, the market could do what it was designed to do- correct itself. Those who had no business becoming homeowners or bought more home than they could possibly afford need to step back into a rental, helping to solve our vacant inventory problems and drive rents back up to where they should be, which in turn attracts more investors to buy investment properties. The market was destabilized be de-regulation- the government played a major role in the predicament we are facing. Why would anyone think the ones that got us into this mess are the most qualified ones to get us out? The one glimmer of hope I had for the stimulus package was the tax credit for home purchase- until they decided to place limits on it (1st time homebuyer). Does anyone believe there are really enough 1st time homebuyers out there right now to jumpstart the market? Imagine how much more effective this plan would have been if the offer extended to any home purchaser- investors with smart money would flood back into the market making a drastic impact. I think it is just another example of the disconnect between our leaders and the people. We are fast becoming a nation divided into two groups- the haves and the have-nots. The "haves" are made up of government officials and big business which fall under the category "cannot be allowed to fail". The have-nots are the rest of us.

Landlord's Learning Center- My Top Ten Things an Applicant Should NEVER Say...And WHY?

Sat, 21 Feb 2009 05:39:11 -0800

Fellow ActiveRain neighbors- This one is just for my own sanity, as it helps to list the things that slowly drive us just a little closer to crazy over the years. Maybe you can identify with one or more of these beauties, offered purely in jest (with a healthy dash of reality): 1. Reminding the property manager that "this is my 2nd call." We return all business calls within 2 business hours, but this still comes up as impatient people (those whom the world clearly revolves around) will call at 11pm, then 6am, then 7am. Starting out crabby is never a good way to go. 2. "We are really clean." 9 times out of 10 this means you are anything BUT clean, as neat and tidy people never point this out; it just comes naturally. 3. "We have NEVER been evicted." Yet. Again, good tenants don't feel the need to point out an obvious truth or seek recognition for something that your supposed to do. You should never be evicted, but just because you haven't, it doesn't mean congratulations are in order. 4. "We have the cash to move in right NOW." Smells of desperation. A well qualified tenant assumes we, as property managers, will be verifying employment and income, so they have little reason for pointing out the obvious. 5. "We really love the place and hope we get it...God help us." Now this is a tough one, because I consider myself a decent Christian, but I think the almighty has more important things to attend to that doctoring up a bad credit report. If credit is the issue, we encourage applicants to discuss this with us before we run the application, in the hope that we can, at the very least, spare them a wasted application fee. 6. "I have an eviction, but it was from before when I had a roommate, so it wasn't MY fault." In life, we are often judged by the company we keep. If a rental unit is damaged or the rent is unpaid, the responsibility lies with each and every occupant, as they are all "jointly and severally liable". 7. "I have bad credit, but I went through a divorce, so it was my ex-husband's/wife's fault" Pretty much the same as #6. We log it under the subheading "It wasn't me, except it really was". 8. "How much is the Late Fee?" One of the worst questions an applicant can ask, as it gives us a glimpse of future headaches as yet unfelt. 9. "My boyfriend/girlfriend has an eviction, so can we just run the application under MY name?" It amazes me how often this one comes up. Granted, I go out of my way to look more casual and approachable than most in my profession, and it pays off. People will actually confide in me with the idea being that I will help them dupe our owner client into renting a property to them. Hmmm, will I lie to my client to help you out, because I am just such a nice guy? Let me think- NO. 10. "My dog? Oh.....he's a MIX." 99% of the time, mix=pit bull. Any time I hear this one, we either review photos of the animal, or meet it in person. Non-Pit bull mixes have more specific names (i.e. labradoodle, tiny mutt, etc.). Beware the "Mix". Investors Choice Property Management (ICPM) manages 110 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say: “Experience Property Management the Way it Should Be.”

Landlord's Learning Center- Does Your Property Manager Stay Involved With Your Rental?

Sat, 14 Feb 2009 03:46:47 -0800

Investors Choice Property Management (ICPM) is a small, serviced-based management company serving the greater Sacramento area, as well as Lincoln, Auburn, Natomas, Folsom and Elk Grove. Our business is almost entirely word-of-mouth referral and all properties are personally managed by a Broker that stays involved with every aspect of the management process, including: 1. Broker review of all prospective applicants. 2. Broker inspection of all move ins and move outs. 3. Broker review of all maintenance requests with NO MARKUP on any repair or maintenance item. 4. Broker / Owner communication with no middlemen, departmental transfers, trainees, etc. In short, our clients have the distinct privilege of having their property personally managed by a licensed Broker with over 16 years of experience. If you or someone you know has an investment property in need of effective management, stop getting lost in the shuffle or dropped into voice mail. If you are not on a first name basis with your Property Management Broker, isn't it time to remedy that? Try ICPM for 30 days, and find out what we mean when we say: "Experience Property Management the Way it Should Be. ICPM manages 110 units with superior care and diligence for people from all walks of life- from serious long term investors to established real estate professionals to individual investment property owners, like Tony and Jennifer Chu, current clients with an upscale Elk Grove home. Recently, they paid us a valuable compliment: Hi Thomas, Thank you very much for your efforts. My wife and I are very glad we have your services and we can usually sleep better knowing we have someone with your experience on our side. We are very impressed with the professionalism, prompt service, and attention to detail of you and your business. Regards, Tony and Jennifer We appreciate each and every unsolicited testimonial we receive and value each client as an individual, not just an account number. We sincerely thank all our our clients and referring agents that have made our business such a success over the years, and look forward to a prosperous 2009. Thomas R. Martin, Broker/Owner ICPM