Summer Brings us Blockbusters. Here are Two Cinderella Stories.
Author: Paul Branton, Director of Investment Services
It has arrived! Summer 2017 officially starts today, June 20th! I can hardly believe that its already here, can you?
If you can recall, back in March I authored a post asking “Who’s ready for the Madness!?!?” and in May I wrote “You have to spend money to make money.” Well, I’m happy to report that the Home Rental Services team was ready for the madness! (and now we’re ready for Summer!)
Over the past few months, we’ve had the privilege of helping quite a few investors do exactly what I discussed in my previous posts. We’ve been able to help these investors in a number of ways such as: identifying properties, preparing renovations budgets, coordinating renovation work and of course, professionally leasing and managing the properties as long term rental investments.
In order for you to have a better idea of the process, here are a couple of examples:
Investment Property Example #1
Location: South Overland Park
Under Contract: 3/16
Closed: 4/27
Purchase Price: Low $300’s
Home Specs: 2 Story Plan with 4 Beds, 3.5 Baths, Finished Walkout Basement, Approximately 3,000 Sq. ft., 2 Car Garage
Rental Rate Projection: $2,300-$2,500
Renovation Budget: $13,693
Projects:
- New Deck w Cedar and Composite Materials
- Adjust Doors
- Glaze Hall Shower
- New Tile Floor in Master Bath
- Demo Fluorescent light in master and install LED can lights
Work Started: 5/1
Work Completed: 6/2
Lease Starts: 6/12
Lease Term: 3 years
Rental Rate: $2,395/month
Investment Property Example #2
Location: South Olathe
Under Contract: 3/27
Closed: 4/28
Purchase Price: Upper $200’s
Home Specs: California Split Plan with 5 Beds, 3 Baths, Finished Walkout Lower Level, Approx 2,500 Sq. ft., 3 Car Garage
Rental Rate Projection: $1,950-$2,150
Renovation Budget: $15,439
Projects:
- Mudjacking
- Junk Removal
- Extend downspouts
- Demo Concrete pad and install sod
- Paint Garage Walls and entry door
- Remove Curtains and Install 2” White Faux Wood Blinds
- Install new Hardwood flooring at front living room area
- Misc. Painting
- Tile Master Bathroom
- Install new Vinyl Plank Flooring in Lower Level Rec Room
Work Started: 5/1
Work Completed: 6/3
Lease Starts: 6/30
Lease Term: 2 years
Rental Rate: $2,250
On new acquisitions, I tell Investors to plan for about 45-90 days of combined renovation and marketing time. As a frame of reference, in 2016 our average combined renovation and marketing time for new acquisitions was 59 days. This means that once the home closed, it was placed on the market for rent, renovations completed, the lease was executed and tenants moved in, all in under 60 days!
If you or someone you know is interested in learning more about real estate investing in Kansas City, please let us know! We would love to help!
Now I’m headed to the driving range… right after I grab my first Quik Trip Dr. Pepper for the summer of 2017! Have a fun and safe summer everyone!
A Cautionary Tale: The Day Jennifer’s Water Heater Almost Burned The House Down.
This is a guest post from our very own Jennifer Hermon, Administrative Specialist for Home Rental Services.
The day after Memorial Day, we learned that our smoke detectors are functioning well. Thank goodness. It took a while to realize that the water heater was the potential ignitor of a house fire.
Five a.m. on Tuesday morning, the sound of ten smoke alarms screeching throughout the house launched me out of bed, into my robe and stumbling out the bedroom door. I ran recklessly through the house trying to locate the source of what was surely a malfunction or false alarm.
I could hear one of the boys banging on the other’s bedroom door and noticed that the dogs were frozen in place. Still, I kept looking for what had caused the smoke alarms to go off. It wasn’t until I opened the storage room door that the shrill sound finally ceased.
I was stumped. I’ve been in the property management industry for almost 20 years. I know the cautions, the signs and hazards. Or so I thought.
The air conditioning was on, so the fan was running. I thought maybe something was wrong with it and turned off the power switch at the unit. After all, it was at least 16 years old. But my detectors weren’t carbon monoxide detectors. Only smoke. There’s no smoke in the house.
The Water Heater
Thankfully a person taller than I am noticed an old paper manual of some sort on top of the water heater. The edge was brown, warm and crisp like it had been smoldering. And two 1 foot sections of floor trim were also on top of the water heater. They were warm and showing signs of browning.
My stomach turned when I realized how close I was to leaving for work with my kids at home and a potential fire situation. Even worse was the thought of what might have happened if the smoke detector in the storage area hadn’t worked properly. I had visions of a roaring fire filling our house with smoke before we could see or hear that anything was happening.
Did you know that most people who exit the house during a fire don’t have shoes on? I was brought up in a family of American Red Cross volunteers and I still wasn’t ready. PJ’s with no shoes, no glasses on. It’s easy to overlook. You think it won’t happen to you.
Morals of the story:
1) Nothing should be placed on top or near your water heater. It’s not just the furnace that needs to be clear of items.
2) Always test your smoke detectors twice a year. When the clocks change is an easy reminder. Fall back, Spring forward – change your filters, check your detectors, change your batteries (in smoke alarms and flashlights).
3) Make sure you have fire extinguishers that haven’t expired. Do you or your kids know how to operate an extinguisher?
4) Practice fire drills with your family! You might avoid 30-60 seconds of confusion if you practice, and that could make a big difference in the event of a real fire.
Each year, Home Rental Services helps place quite a few families who have lost their home due to a fire. That fact alone proves it can and does happen. Please take time today, or this weekend, to make an emergency readiness plan with your family. Commit to practicing fire drills. Check with your Department of Public safety for fire, tornado and other safety tips for the whole family. Be safe!
What Do You Mean I’ve Been Fined For Not Registering My Rental Property?
Author: Joshua Volland, Property Manager
What do you mean I’ve been fined for not registering my rental property?
This has been the reality in the past for some landlords who have failed to update the county with their new mailing address. Most cities use the county records office to mail important notices to owners, from code violations to taxes or in the case of this story; rental license applications.
Rental Registrations
There are several cities that have rental registrations in place. This article will focus on the process for a rental home in Overland Park.
Although Overland Park had rental registrations and then did away with them, they’ve created a new rental registration and inspection program that they’re rolling out in July.
I and others from Home Rental Services have been attending public meetings held by the City of Overland Park over the past year plus. The way the new program is being rolled out is confusing. We’re here to help guide you through the process and help you understand what to expect.
For the city of Overland Park…
If your rental home is in Overland Park, you need to ensure that the Johnson County records reflect your correct mailing address on the property records page.
- You can do a quick search of your rental property at: http://ims.jocogov.org/locationservices/
- When you input the rental property address in the search box and click Go, you will see detailed results for your rental home. (There’s a lot of helpful information!)
- Navigate to the listed Owner Information. If this doesn’t have your current mailing address, it’s important to get this corrected promptly with the county.
- For Johnson County, this can be done by completing the Change of Address: Real Estate & Personal Property form at: http://www.jocogov.org/dept/treasury-and-financial-management/real-estate-and-personal-property-tax/change-address
Why is this so important for rental homes in Overland Park?
It’s important because the city of Overland Park has decided to send all rental home owners the new rental registration form directly to the published address found in the Johnson County records as mentioned above. Although we’ve tried to work with the City to proactively get them a list of the homes we manage in Overland Park, they’ve insisted their method is the only way they’re willing to send the new rental registration forms.
If you don’t complete the new rental registration form, you could be fined. And if your mailing address isn’t correct, you might not even see the new registration form!
ePLACE – An alternate method for Overland Park Rental Licenses
Alternatively, the City of Overland Park has given you, the property owner, a second option. You can apply for a rental license using ePLACE (https://energov.opkansas.org/CSS/SelfService#/home), the City’s online portal for permitting, licensing and inspections. You need to set up an account with ePLACE to start, and if you need help using their system, you can email ePlaceHelp@opkansas.org or call 913-895-6000.
When to Apply
Overland Park has advised not to apply for a rental license earlier than two months prior to your pre-scheduled inspection date, which can be found online at: http://www.opkansas.org/resident-resources/neighborhood-resources/rental-licensing-and-inspection-map/
How the Program Works
The program requires owners to obtain and maintain a valid rental license and pass an exterior inspection of each rental property.
The $60 per building fee funds licensing, inspection and code compliance for rental properties annually. Rental licenses will be good for two years, making the minimum fee for a single rental dwelling unit $120.
- Two months prior to a property’s scheduled inspection date the City will notify the owners of rental dwellings of the need to file a rental license application.
- Property owners should return the completed application to the City.
- Upon receipt of the application, the City will make note of the appropriate contact information for the property and schedule the inspection.
- The City will generate an invoice and send it to the appropriate contact person.
- Upon payment of the invoice, the City will send a Rental License Permit to the owner.
- The City will conduct an inspection sometime within the month that the property was scheduled for inspection.
- The City will notify the appropriate contact person of the inspection results. If inspectors find deficiencies, the owners will be notified of the need to bring the property back into compliance.
Inspection Cycles
The program will be phased in on a month-by-month basis over a two-year period. Inspection phases will be:
Phase One: July 2017-April 2018
Phase Two: July 2018-April 2019
Inspection cycle restarts: July 2019
Landlords and other interested parties are encouraged to use the interactive map (http://www.opkansas.org/resident-resources/neighborhood-resources/rental-licensing-and-inspection-map/) to see when their properties are scheduled for inspection. The map will show the month and the year of the inspection.
When completing your application, you will want to be sure to provide Home Rental Services as your property manager if you are a current client.
Home Rental Services
6900 College Blvd Suite 990
Overland Park KS 66211
Phone: 913-469-6633
Email: propertymanagers@home4rent.com
If you do find yourself with any questions or concerns or needing assistance with navigating the process, please do not hesitate to contact me and I will be happy to assist.
Home Rental Services is Taking the Show on the Road!
Author: Sandy Fisher
That’s right, folks, we’re officially on tour… book your 2017 dates now!
What am I talking about? Well, a little over a year ago Home Rental Services launched our Investor Services program starring our Director of Investor Services Mr. Paul Branton.
(Note: This service costs nothing for Owners or Realtors®.)
We’ve done one show and we’ve got a few more booked in the months to come. Although Paul is the star of the show, Kandy Meehan, our owner and president, is the M.C. of our little gig, and I’m the production crew. I’m sure Paul and Kandy really can sing and dance, but that’s not what our show is about.
We’re making scheduled appearances at area Kansas City real estate broker offices to give a ten-minute presentation on Paul’s unique Investor Services program.
Many Realtors® work with investor clients, and they’re certainly the experts in the purchasing of the investment property. However, what happens when the investor wants to know things like projected rents of properties, vacancy rates, or what kinds of properties rent well in the Kansas City area?
What does the Realtor® do? They call Paul!
Paul will step in at any part of the investment purchase process to help that Realtor’s investor client make the best investment purchase. We want Realtors to leverage Paul and Home Rental Services’ experience as an ancillary service for their investor clients.
Is there a catch? There’s no catch, especially for Realtors. We don’t list homes for sale, and we don’t work with buyers. If during the process the investor decides to have Home Rental Services work for them for their leasing and property management needs, then that’s a bonus for us for sure.
A couple of other fun parts about our Home Rental Services 2017 Investment Services tour… we don’t only feed the crew, we feed the audience as well. We bring a spread of morning snacks and some pre- and post-show conversation. And secondly, you might just see the star of the show pull up for his rock star parking spot in our newly wrapped HRS company vehicle. It looks great, and you’ll notice Paul’s entrance for sure.
But what we’re really hoping you notice, is our commitment to helping our Realtor friends help their investor clients.
Here’s to a successful HRS 2017 tour!
We’ve Been Wrapped!
WE’VE BEEN WRAPPED!
As much as the Home Rental Services team travels all around our beautiful city, you may have missed us driving next to you. That’s going to change! We just picked up our cute, newly wrapped HRS vehicle this week, and we can’t wait for you to see it!
On the day it was available, we eagerly headed to Wrap Factory KC in Edwardsville. We were so excited to see the finished product. Aside from there not being a big red bow on it when we arrived, we found it beautifully wrapped and ready to go. We tried to coax Matt with Wrap Factory KC to come out and take a picture with us and his finished product, but he humbly answered, “one hundred percent no.”
So we shook his hand, said a big thank you, and went out and took our own pics. What do you think?
Be on the lookout for our wrapped Prius. Let us know if you see us out and about!
Home Rental Services at Pop Tab Pandemonium 2017!
This past weekend was the annual Pop Tab Pandemonium event supporting the efforts of the Ronald McDonald House. It was a beautiful day! We enjoyed spending time together supporting a great cause.
The Mission
The Ronald McDonald House Charities of Kansas City keeps families with sick children close to each other and the care and resources they need. Their three houses are adjacent to Children’s Mercy Hospital. They create places of respite where families can rally around and support one another. While they’re physically located near Children’s Mercy downtown, they serve all pediatric hospitals in Kansas City.
The Event
Pop Tab Pandemonium is an event where people bring aluminum pop tabs and old keys that they’ve collected as a donation for the Ronald McDonald house. Home Rental Services saves pop tabs all year long, and in the course of doing business as a residential property management company, we accumulate quite a collection of keys that can be recycled. We had hundreds of keys and a bunch of tabs to drop off! This year, we had even more metal to donate because our locksmith gave us old padlocks, lock boxes and keys to take to the event. The box we used for that part of our donation was incredibly heavy.
Ronald McDonald house partners with a local salvage and recycling company to convert the keys and tabs to dollars that go directly towards supporting the Ronald McDonald house programs and projects.
On any given night, Ronald McDonald House Charities of Kansas City serves 87 families. Last year, our Houses and Family Room provided lodging to more than 4,500 families as well as opened our doors to support over 63,000 visits from family and friends of in-patients at Children’s Mercy Hospital.
You have to spend money to make money.
Author: Paul Branton
“You have to spend money to make money!”
So, I know this probably isn’t the first time you’ve heard that phrase but let me quickly explain why it is extremely applicable and important when investing in rental property.
For starters, you have the initial purchase which requires a down payment, closing costs, inspections, etc. and those are simply to buy the property. Next, you will generally need to make some capital improvements in the way of new paint, flooring, lighting, countertops, etc. that will require more money. Last but not least, in addition to the capital improvements, there are typically repairs or deferred maintenance that also require your attention and money when you purchase a property.
The good thing about the capital improvements is that those will bring you a more immediate return in either increased rent, increased property value and/or reduced vacancy. (Hopefully, it gets you all three!)
While addressing the general repairs and deferred maintenance will not necessarily bring you a return, it will certainly help maintain the value of your investment as well as safeguard against potentially greater damages/costs in the future.
Vacancy is the enemy!
When looking at spending money on improvements, you should not only ask the question “How much will that cost?” but also “How much can this potentially save me?” For example, If your property rents for $1800/month, every week of vacancy is costing you $450 and every day is eating up $60. So wouldn’t it be worth removing the dated wallpaper, and painting that room for $450 bucks, if it will get the home leased a week or two quicker?!
Why am I saying all of this? Why am I telling you it can require a good deal of money when you invest in real estate?
Because it’s important. Because we want you to be prepared… and successful!
As we continue forward in this journey of real estate investing, while some of our secondary objectives may differ slightly, I am certain that the primary is the same: Making Money/Building Wealth. If that’s true, then I highly encourage you to remember this old adage when looking at your current portfolio as well as new opportunities… “You have to spend money to make money.”
Please reach out and let us know if we can provide any guidance on acquisitions or capital improvements for your portfolio.
Have a great week!
Paul
Please Welcome Oretta Croushore, our Assistant Property Manager
Oretta joined Home Rental Services in February 2017 as an Assistant Property Manager. Oretta focuses primarily on our renters. She makes sure that they are well taken care of and that any maintenance requests are handled in a timely manner.
Oretta handles all the move-in appointments with our renters. These are all done in our office so renters get to meet Oretta face-to-face. When a renter moves out, Oretta reviews the move-out inspections and sets up appropriate work orders to get the property ready for the next renter. Oretta works with our owners as well. Usually, these interactions involve coordination of updates to the properties and managing our trusted vendors as they do the work.
Oretta came to us from the optical industry. She had daily interaction with optical practice managers and helped them troubleshoot issues with their optical products. Oretta has an extensive background in both the retail and wholesale aspects of the industry.
Oretta is married and her husband’s name is Shawn. We laughed out loud when she told us that they can always be found where the “older” people are… they love playing Bingo, taking in shows at the dinner theater, and going to Branson, Missouri. Oretta has a daughter named Poppy. Oretta is a Girl Scout leader for her daughter’s troop as well as a Girl Scout recruiter for adult volunteers for the organization.
Oretta loves doing crafty things. She especially loves to crochet when it’s colder while watching Netflix. She also loves to cook and gets new recipes from Pinterest. One of her favorite things about cooking is finding really good food that is still healthy to eat. She cooks mostly from scratch!
When asked, Oretta said that the culture at Home Rental Services is what convinced her to take the job. She feels that everyone is invested in the company. She particularly likes that everyone’s ideas hold weight… it doesn’t matter how long you’ve worked at Home Rental Services… if you have a good idea, they want to hear it.
We love Oretta’s sense of humor. She’s hit the ground running and definitely adds spice and humor to our culture!
What is colorless, tasteless, odorless and the second highest cause of lung cancer?
Author: Paul Branton
Hey there! I’ve got a riddle for you today.
What is colorless, tasteless, odorless and the second highest cause of lung cancer? What was that?! Did you say your mother-in-law’s cooking? Ok, well that’s both incorrect and a potential cause for couch sleeping; I won’t tell anyone you said that. For those of you who said radon gas, you are correct. Congratulations!
According to the Environmental Protection Agency (EPA), radon is a gaseous radioactive element that has the symbol Rn and is derived from the radioactive decay of radium. Since it is created by radioactive decay in soil, rock and water, it naturally moves up into the air we breathe, often times through the foundation floor and walls of our homes.
Quick Stats About Radon:
- #2 cause of lung cancer, second only to smoking
- Approximately 1 in 15 homes have an elevated level of radon gas
- Estimated to be closer to 1 in 4 homes in Kansas
- Radon tests cost $85-$135 and radon systems cost $800-$1600 on average
If you’re excited to learn more about radon, here’s a great link to the EPA’s “Guide to radon”.
This pamphlet walks you through what the EPA recommends you do when taking possession of a home with regard to radon testing. In addition to the EPA’s pamphlet, here’s a great circular published by the Kansas Geological Survey that goes into much greater detail on radon, specifically in Kansas.
Testing is important!
This is the only way to determine the level of radon in a building and confirm if it’s above or below 4 picocuries per liter (pCi/L). If the test finds the radon levels above 4 pCi/L, that’s too high… and a mitigation system should be installed to lower the levels. In Kansas, radon contractors are required to be certified, so make sure when selecting a professional to work with, that they have the proper credentials.
If you already have a system installed in your home, make sure to check the levels on the pipe every so often to ensure it is still properly operating.
Should the test come back with high levels of radon and a system needs to be installed, make sure that everyone is on the same page for what is considered an acceptable installation placement.
In the end, it’s important to be aware of radon and the effects it can have on those living in your home and to address any potential concerns.
Have a great week!
Thanks-A-Lot from Home Rental Services!
Author: Sandy Fisher
I’ve shared before that a fun and important part of my job is delivering little “pop-by” gifts to our referral friends who send potential business our way. For the month of March, I helped a cute little Girl Scout salesperson reach her sales goals and I purchased thirty boxes of the Thanks-A-Lot cookies.
Who doesn’t love a good Girl Scout cookie, right?
The twenty or so Realtor® friends I delivered them to throughout the month of March sure did! It’s such pleasure popping into real estate broker offices all over the city and surprising our Realtor friends with our gift of choice for that month. And, of course, saying thank you—which is why the Thanks-A-Lot cookies were perfect.
On each cookie package was a handy dandy label that read, “No matter how the cookie crumbles, you are the best part of our business.” And then I packaged two boxes of the Thanks-A-Lot cookies together with our signature green-colored ribbon and attached a personal note thanking the friend for their recent referral to Home Rental Services.
Some of our Realtor friends are in the office when I deliver, but most are not. So here’s the extra fun part—if my gift recipient is not around for me to hand them the package in person, I take a fun little selfie with the gift while I am in their office. When I get back out to my car, I send the Realtor a text with the selfie pic and let them know a special treat/gift is waiting for them. I always get a fun text back saying thanks, and it usually leads to a short text conversation quickly catching up.
You’ve heard the saying, “You get what you give,” right? Well, that’s the whole goal of these little “pop-by” gifts and visits. We want to give, give, give, and if we get a little back from that, well, that’s icing on the cake (or should I say cookie!)
