[Video] – 4 Reasons You Should Consult a Property Manager Before Buying Investment Property in Overland Park

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At Home Rental Services, we work within the greater Kansas City area, and we love providing helping investors find properties that will make great rental homes. Today, we are sharing four reasons you should use a property manager when buying an investment property.

Overland Park Property Management Knowledge

A property manager will know the local market. This is invaluable when you are trying to buy an investment property that is in demand. A property manager will be able to help you with the areas that are in demand and the rental price point that good tenants are willing to pay.

Increasing an Investor’s ROI

When you talk to a property manager before you buy an investment property, you’ll get the maximum return on your investment. We recently spoke to an investor about the value of buying two $200,000 homes instead of one $400,000 home. The return you earn will depend on what’s in highest demand in terms of school districts, desirable locations, and the floorplan of the home.

Overland Park Property Management Home Evaluations

We will walk the property down before you put a contract in on a home. We know what renters are looking for and what will work for the home you’re considering. Recently, we looked at large house with a huge utility box in the middle of the back yard. That’s not a useable yard, and tenants would see that. So, we encouraged our investor to continue looking.

Helping You Attract Top Notch Tenants

When we walk the property, we put together an A-B-C list. On the A list are things you have to do. That might mean painting the purple bedroom or the red dining room. These are the things that must be done to get the property ready for the rental market.  On the B list are optional things like upgrading the light fixtures or putting in stainless steel appliances. The C list is what you’ll refer to when you still have money left over. You can do granite counter tops or put in some new landscaping.

These are four good reasons to work with a property manager when you’re buying an investment property. For more information on investing wisely, please contact us at Home Rental Services. We’d be happy to talk to you about our Overland Park property management services.

Japanese Beetles causing damage across the KC Metro

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Japanese BeetleHave you seen any Japanese Beetles on the plants or shrubs in your yard? Take a look at the picture. They usually have an iridescent green thorax and head and copper colors on their bodies. In a way, they are pretty. The problem is that they are destructive.

We’ve heard from some of our landscaping vendors that this beetle is causing damage all over the Kansas City metropolitan area. They damage plants by “skeletonizing” the foliage, that is, consuming only the leafy material between the veins of leaves, leaving skeleton leaves behind.

It’s called a Japanese Beetle because of where it originates. It’s not a problem in Japan because there are many natural predators that keep the population in check. But in the United States, there really aren’t any natural predators and they can quickly get out of control.

What to do if you find Japanese Beetles

When treating for Japanese Beetles, a multi-part attack is best.

  1. Purchase Japanese Beetle killer spray (here’s some for $10 at Home Depot.) The nice thing about this spray is that it also works against aphids, white flies, bag worms, spider mites, leaf miners and more.
  2. Hand pick. We know… it’s kind of gross. But Japanese Beetles are slow and easy to grab. If you have the stomach for it, you can remove them from plants and drop them in a bucket filled with soapy water to kill them.
  3. If you have a major infestation, it’s a good idea to take some preventative steps for next year. Consider researching grub guard and milky spore products that you can use to treat the ground. It takes about a year for these to become effective, but once in place they can protect your yard for up to 10 years.
  4. Finally, if you are a renter with Home Rental Services, have tried some of these measures, and are still having a problem, please contact your property manager for help with setting up professional treatment.

We hope you haven’t seen any Japanese Beetles in your yard. If you have, we hope this article was informative and gives you some steps you can try to take care of the problem!

Japanese Beetles
Photo By D. Gordon E. Robertson – Own work, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=8826238

An easy way to clean window tracks!

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We’re always looking for tips that make household maintenance even easier. Joshua, one of our property managers, saw a great blog post on how to clean dirty window tracks easily. The following is from TheIntentionalMom.com and we loved the process! It’s an easy way to clean the buildup and grime that accumulates in the tracks of windows and sliding glass doors.

Cleaning WindowTools for the job:

  • Toothbrush
  • White vinegar
  • Baking soda
  • Paper towels
  • Rag
  • Butter knife

The steps:

  1. Sprinkle baking soda on the worst parts of the track.
  2. Cover the baking soda with some vinegar and it will start to bubble.
  3. Let the solution sit for 5-10 minutes while the grime is loosened.
  4. Use the toothbrush to move the grime to the center of the track.
  5. Use a paper towel to wipe up the worst of the grime.
  6. Wet the rag and use it to clean up the rest of the track.
  7. Use the butter knife pressed inside the rag to help you get into corners if necessary.
  8. Give the track one last wipe with the rag, and you’re done!

It’s that time of year… Top 5 back to school safety tips!

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Back to SchoolCan you believe it’s already August? If you have younger kids, August is the time to grab the supplies checklist and head to your local Target or Walmart to stock up. It’s a busy time. But you should never be too busy to make sure your kids are safe. We thought it would be timely to provide our top 5 safety tips for younger kids heading back to school.

Communication
Make sure your children know their home phone number, address, how to get in touch with both parents at work, how to get in touch with another trusted adult and how to dial 9-1-1. Consider putting a note card in their backpack or school bag that has this information.

Product Recalls
Hoverboard RecallDid you know there is a website for checking product recalls due to safety hazards? It’s the U.S. Consumer Products Safety Commission website at http://www.cpsc.gov. One of the most recent recalls is for 500,000 hover boards made by 10 different companies because their batteries can catch on fire. Here is a link to that recall. And here’s a link to all recalls so far in 2016. The recalls so far this year include IKEA shelves, video baby monitors, jogging strollers, and more.

Walking to School
Teach your kids to always walk on the sidewalk. When no sidewalk is available, explain that it’s a good idea to walk facing traffic so that they can see potential problems as they happen. Always look left, right and left again before crossing streets to make sure there is no oncoming traffic. Make sure electronics like MP3 players or handheld video games are not being used while walking to school, (especially with the recent craze with Pokemon Go!)

Biking to School
Bike HelmetMake sure your child wears a helmet any time they are riding a bicycle or scooter to school. The helmet should fit snugly and be level with the top of their head. It may be a good idea to make sure their chin strap is buckled before they leave the house.

Riding the Bus to School
Make sure your children stand six feet away (or 3 big steps) from the curb. If they need to cross the street in front of the bus, make sure they walk on the side of the road until they are 10 feet ahead of the bus. Explain that they should always be able to see the bus driver, and the bus driver should always be able to see them.

 

4 Reasons to Invest In Real Estate – Part 4: Tax Benefits

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We answer lots of questions about why it’s good to invest in real estate. We thought you might want to know our top four reasons for owning investment property!

This is part 4 of a 4 part series of blog posts:

1) Cash Flow
2) Appreciation
3) Paying Down Your Loan
4) Tax Benefits

Tax benefits

Tax BenefitsMany landlords are not aware of all the great tax deductions you can get when you own investment property which means that many landlords are overpaying on their taxes… who wants to do that? Rental properties allow more tax advantages than pretty much any other investment vehicle. That is good news!

1.  When you think of the rental income you are going to get, it’s great to know that expenses such as repairs, maintenance, leasing commissions, property management fees, interest on the mortgage, utilities, make ready costs, HOA dues and more are usually tax deductible.

2.  Real estate taxes on your investment property are… tax deductible.

3. The IRS allows you to not only depreciate the house (not the land) but also capital expenses such as roofs, replacement windows, etc. All of these things work to reduce your taxable income.

4.  If you have one of those not-so-fun years and you lost money; your losses can also help offset other income which is a bright spot. (There are some annual limits to this…check with your tax advisor.)

5.  If you decide you want to sell your investment property at some point and you are looking at a sizeable profit, the IRS has a great program called a 1031 Exchange. This program has some specific date limitations but essentially allows a perfectly legal way to defer capital gains taxes (always a good thing).

Be sure to consult a tax advisor who knows all the deductions you can take when you own rental property. You want to be sure to take advantage of all of them!

We recommend that you work with your attorney or CPA before making legal or financial decisions.

Conclusion

When you consider cash flow, appreciation, paying down your loan, and tax benefits, owning an investment property can be an excellent way for you to generate passive income.

To learn more, please give us a call at (913) 469-6633 or email info@home4rent.com.

4 Reasons to Invest In Real Estate – Part 3: Paying Down Your Loan

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We answer lots of questions about why it’s good to invest in real estate. We thought you might want to know our top four reasons for owning investment property!

This is part 3 of a 4 part series of blog posts:

1) Cash Flow
2) Appreciation
3) Paying Down Your Loan
4) Tax Benefits

Paying Down Your Loan

Paying Down DebtWhen you purchase a rental property with a mortgage, you make a monthly payment to the lender. That payment includes two parts: principal and interest. Interest is the profit for the lender, but the principal is money you are paying down the loan with.

For example, if you purchased a house five years ago for $100,000 and got an $80,000 mortgage. We’ll say it was a 30-year mortgage with a 5 percent fixed rate.

Today, you would owe only $74,000 because $6,000 of your monthly mortgage payments went towards the principal of the loan amount. Ten years from now, you would owe only $65,000. This means that every year your equity increases, you would gain value in the property as long as the market value didn’t go down. Equity is the difference between what a property is worth and what you owe on the mortgage.

If you are in a financial position where you can buy the property outright, you have 100% equity. But you’ve also tied up a sizeable amount of your liquid assets (cash) in that property.

The decision to take out a mortgage or purchase a property outright is influenced by many factors including interest rates, tax law and more. We recommend that you talk with your accountant about the best way to financially acquire a property.

Next week, we’ll talk about the fourth benefit of owning investment property, Tax Benefits!

4 Reasons to Invest In Real Estate – Part 2: Appreciation

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We answer lots of questions about why it’s good to invest in real estate. We thought you might want to know our top four reasons for owning investment property!

This is part 2 of a 4 part series of blog posts:

1) Cash Flow
2) Appreciation
3) Paying Down Your Loan
4) Tax Benefits

Appreciation

AppreciationWe appreciate you reading our blog posts! But that’s not the “appreciation” we are referring to when talking about reasons for owning investment property.

Appreciation is the historical trend that properties rise in value over time. Sure, there are corrections in price when the economy is suffering like in 2007, but over the years, property values usually increase.

If you currently live in a home that you own, you’ve probably seen this happen first hand. You get a tax assessment every year and it’s rare that the assessed amount goes down.

Let’s say that you bought your home for $250,000. Ten years later, that home might be worth $270,000-$300,000 based on how well real estate performs related to the economy. If you sold your home, you would realize $20,000-$50,000 of gain (minus closing costs, etc.)

And that’s an example for just one home.

In the first part of this series, we talked about buying multiple investment properties and assumed that you were able to purchase 5 homes over a period of years. When you start multiplying appreciation gains across multiple investment properties, the numbers really start to add up. You could be looking at $100,000-$250,000 of potential gain after 10 years. (We say potential, because you won’t realize a gain until you sell the properties, and many investors choose to hold them for the long term.)

Next week, we’ll talk about the third benefit of owning investment property, Paying Down Your Loan!

4 Reasons to Invest In Real Estate – Part 1: Cash Flow

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We answer lots of questions about why it’s good to invest in real estate. We thought you might want to know our top four reasons for owning investment property!

This is part 1 of a 4 part series of blog posts:

1) Cash Flow
2) Appreciation
3) Paying Down Your Loan
4) Tax Benefits

Cash flow

Cash FlowCash flow is the profit you have each month after you’ve paid for all of the expenses on your investment property.

Let’s say that you get $2,500 per month in rent. Let’s also assume that your mortgage and property management fees are $1,800 per month, leaving you $700. During the month, you had a garbage disposal that needed to be replaced for $300, leaving you $400 in cash flow.

You might be thinking to yourself that $400 is not going to make you rich. And it probably wouldn’t unless you had multiple properties yielding $400 per month in cash flow… but this is just one of the four reasons investing in real estate is a great investment.

Many of our investment clients own multiple properties that we manage for them.

Let’s say that you were able to buy five properties over the course of 5-10 years. If they were all cash flowing $400 per month, you would have $2,000 per month of passive income. That’s starting to become a number that matters. It’s a number that could allow you to buy the boat you’ve always dreamed about or retire a bit earlier.

Next week, we’ll talk about the second benefit of owning investment property, Appreciation!

Happy 4th of July from Home Rental Services!

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4th of JulyIndependence Day, also referred to as the Fourth of July in the United States, is a federal holiday commemorating the adoption of the Declaration of Independence on July 4, 1776. The Continental Congress declared that the thirteen American colonies regarded themselves as a new nation, the United States of America, and they were no longer part of the British Empire.

Independence Day is commonly associated with fireworks, parades, barbecues, carnivals, fairs, picnics, concerts, baseball games, family reunions, political speeches and ceremonies celebrating the history, government, and traditions of the United States.

We hope that you are able to spend time with your family, watch some fireworks and grill up some wonderful food to celebrate our independence this year!

Be sure to check out VisitKC’s website for a list of 4th of July celebration events that are happening over the weekend.

These include:

 

2016 Team Building – Home Rental Services at the Royals [PICS]

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Every year, we take our staff to a Royals game as a team building event. It’s always a great time, and the game against the Chicago White Sox  on Friday, May 27th was no exception.

It was a beautiful evening at Kauffman stadium. Everyone loves the traditional opening to the game, including the singing of the Star Spangled Banner, the opening pitch and which hot dog topping will win the ketchup, mustard and relish race.

The Royals started off the game with a run in the first inning, but then it was quiet until the 6th inning. The White Sox scored 5 runs which definitely changed the energy in the stadium. The Royals answered with a second run that inning.

Going into the 7th inning, the score was 5-2 in favor of the White Sox. The Royals stepped up like they so often do and scored 4 runs. The score was now 6-5 Royals and the momentum never changed after that. The Royals scored another run in the 8th inning and didn’t bat in the 9th after the White Sox didn’t score ending the game at 7-5 Royals.

We loved going to an exciting Royals game and getting to spend some time with each other outside of work!