How To
Treat Your Investment Property Like The New York Subway
Guest post by Jennifer Hermon, Administrative Specialist at Home Rental Services
In the late 80’s, as a teenager, I took a trip to New York. I was terrified that I would have to take the dreaded subway. It’s reputation at the time was that of Gotham’s finest location to get murdered, mugged, drugged or to find housing for vagabonds. I lucked out and never had to descend into that dirty, treacherous underground world.
When I returned ten years later as an adult, I couldn’t understand what the fuss was about. Every day for a week, twice a year, I’d grab my Starbucks and trek down into the tunnels to get to another part of town in just minutes. I loved it! The stations were cleaner than my kitchen! The trains weren’t covered in gang graffiti.
How could this be? How did this entire system get turned into a place people willingly go and seem to take care of? And how does it stay that way?
The story of the NYC subway turn-around is quite amazing considering what those responsible were up against. Crime was up and subway income was down.
What I didn’t know during my first trip to the Big Apple was that new policies were being enforced with cooperation between the mayor’s office, transit authority and police and that they vowed to turn things around underground as well as above. The theory was basically that people won’t take care of something that isn’t cared for and will leave it in no better condition than they found it, or possibly make it worse.
Every train that was painted with graffiti would be immediately painted and not sent back onto the rails until that was complete. The stations were cleaned, lighting replaced, and crime simply not tolerated. The message the city was sending was clear and effective. The agencies involved were diligent and eventually transformed the underground transportation to a profitable system that locals and visitors were happy to travel.
The idea of taking care of things so that others will follow your example can be applied in many other areas. I tested it out for myself.
For instance, when I make the house smell like I just cleaned it (a bit of lemon Pledge spray is effective), my boys seem to be afraid to touch anything when they come home from school. They take their books and backpacks and head straight to their rooms. At least for a few days after a deep clean, they are suddenly putting dirty dishes straight into the dishwasher! They actually respect the space in which they live. I make it easy for them to maintain by providing a container of cleaning wipes and a roll of paper towels in their bathrooms.
If something breaks, I get it fixed. I want them to see that I am holding myself to the same standard of responsiveness I expect from them. (Except when milk runs out, because I refuse four trips a week to the grocery store).
I believe that the same concept applies to a rental home. Arriving in a well-cared for, clean home for the first time puts the tenant/landlord relationship on the right track for a positive experience. They sense your pride in ownership and are likely to carry that forward in how they live in and care for your home.
Landscaping that is well tended tends to stay that way. Issues get reported in a timely manner because the renters know you’ll take care of problems. That you won’t let them sit and fester into something worse. It’s mutual respect that can extend the lease and the life of the home’s components because everyone is working together.
These 5 Things Cost Landlords The Most Money
The following list includes what we consider to be the biggest potential costs a landlord may face. Yes, these 5 things are required expenses for any rental property. But minimizing the exposure to these costs can make a significant difference on the balance sheet at the end of the year.
One: Vacancy
When a home is vacant, no rent is being collected. And that’s a bad thing for landlords. An industry standard of measurement for this situation is called “Days on Market.” The fewer days on market the better. The national average for days on market is 30 days. That’s a full month of rent lost at every turn! On top of lost rent, you also have turnover costs like painting and repairs.
Two: Not Having a Strong Lease
Having a strong lease is key to protecting yourself, and your investment. You want to make sure that it outlines who is responsible for what, and properly covers your liability. Then you must hold renters to the contract that they sign. If you allow them to pay rent a day late, you become the first one to violate your own contract!
Three: Not Screening Renters Properly
Accepting a bad tenant can be costly. They may not pay their rent on time. They may not pay their rent at all. They may not take care of the home, or even worse cause damage.
The best way to minimize the chance of getting a bad tenant is through a professional screening company. Bad credit? Criminal background? Bad leasing history? You can only make an educated decision if you have all the facts.
Four: Maintenance
Every home requires maintenance. The best plan is to set aside a reasonable amount of money every month to pay for things when they break or need to be updated. It’s not about if something is going to require maintenance, it’s about when something will require maintenance. Being prepared financially is the best defense for maintenance costs. You also want to make sure to perform regular upkeep maintenance on things to avoid costly emergency repairs.
Five: Lack of Knowledge
Renting a home is not a simple task. There are so many things a landlord needs to understand to be successful.
What price will the market bear for monthly rent? Too low and you aren’t getting what the home is worth. Too high and you may force longer than necessary vacancy until the price is adjusted.
There are many laws that must be followed related to rental homes. Fair Housing when interviewing and selecting renters. Understanding local laws about the process for evicting a renter. Understanding how to handle security deposits so that you aren’t commingling funds. Getting into legal trouble is expensive and time consuming.
We wrote this story because we manage hundreds of homes and know what it takes to do it properly, safely and successfully. If you need help managing your investment property, please give us a call today. We can help!
Distracted Living: Do You Look At Your Phone 100 Times a Day?
By Paul Branton, Director of Investor Services, Home Rental Services
Do you feel naked when you don’t have your phone with you? Do you find that you always have an electronic device on around you?
If so, you aren’t alone. Would you believe that the average person checks their cell phone over 100 times per day? Wow, it’s no wonder that we feel strange without the devices we’ve come to rely on so heavily.
When I say heavily, I mean that here at HRS, we take technology seriously. We utilize a plethora of databases, apps, websites and tech tools to help increase business efficiency and enhance our client/customer experience. Here is a look at the dedicated folder of “Work” apps I have on my phone!
As this was a growing problem for me personally, and our culture as a whole, I wanted to take a moment to encourage everyone to reduce the attention we give our devices.
You Have to Start Somewhere
Each and every weekend when I get home, I go into my phone settings, select my work email account and click the toggle button that turns it off. This allows me to avoid stress over the number of emails that come through over the weekend. Believe it or not, 100% of the time, the emails are safe and sound… waiting for me in my inbox on Monday morning.
Consistency is Key
Every January for the past four years, my wife and I have taken the month off from social media. We’re not against social media. We realized that keeping up with social media was consuming more of our time than it should. It was distracting us from living. In January this year, I went as far as deleting the Facebook app from my phone entirely. It felt like I got a bit of my life back. And I’ve had no desire to install it again.
Taking it to a Whole New Level
I recently took a three day weekend trip with my family to the lake. I decided I would turn off my phone when we arrived. (I couldn’t turn it off prior because my phone is also my navigation device.)
I powered my phone down and left it in a safe place for the entire weekend. Yes, there were there times when I felt naked because it wasn’t in my pocket. Yes, there were times when I wanted to check the weather or Google something. Or take a picture. But guess what? I survived. And better yet, I was engaged and present with my friends and family the entire time.
Funny side note, when I powered my phone back on, I had a few texts, zero missed calls (ironic) and quite a few emails. Here’s my favorite text message… “Are you alive?”
Its good to know my friend cares… He also sent a text to my wife since I had not responded for a couple days! Thanks Mike!
The Challenge
My challenge to you (and for myself) is to become less distracted by our electronic devices. To be present and “in the moment.” Stop pulling out your phone every time it rings, bleeps or vibrates.
Strike up a conversation with the person on the elevator or in the long line at Chipotle. I bet you notice the difference. And I bet you like the change. Good luck!
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!
5 Tips to Avoid Trouble with Your Security Deposits [VIDEO]
Our landlord advice today is: Five tips for staying out of trouble with security deposits. You don’t want to violate security deposit law or find yourself in court because you made a mistake in the collecting, holding, or dispersing of the tenant’s deposit.
Know Your State Limits
Each state varies a little bit, and our services are in both Kansas and Missouri. In Missouri, you can charge up to two months of rent as a security deposit. In Kansas, it’s one month of rent, unless your renters have pets or the unit is furnished. So, know your state limits.
Charge the Same Amount
You need to charge the same security deposit amount, regardless of the number of people who are living in the property. It may be tempting to charge more when you have 10 people in the house. But, you must charge the same amount even if you’re expecting more wear and tear on your house with extra children and tenants.
Damage vs. Wear and Tear
Only use the security deposit for damage beyond normal wear and tear. If you Google this term, you’ll find about 100 different definitions. If you’re in doubt about whether something is damage or wear and tear, you should probably just let it go. The courts seem favorable to the renters right now, so err on the side of caution.
Know Your State Laws
Understand the time requirements involved in getting the security deposit returned to your tenant. Most states have a window of 30 days, but in some states, it’s 14 days, and some states you have to inform the tenants about the damages you’re charging for after a certain number of days. Just know what your law requires, because there will always be penalties for violating those time limits, even by just one day.
Keeping the Deposit
Don’t just keep the deposit if the renters break the lease. Investors try to do that all the time; it will get you in a lot of trouble with the courts. If tenants owe rent or late fees, or there are damages, you can pull from the deposit. But, you can’t just decide to keep the whole deposit.
These are five things that Overland Park landlords need to keep in mind when it comes to security deposits. If you have any questions about this topic, or anything pertaining to property management in Kansas City, please contact us at Home Rental Services.
4 Reasons to Document the Condition of Your Rental Property [VIDEO]
Proper documentation can be an important resource for landlords, and today we’re sharing four of the really great reasons to document the condition of your property before a renter moves in.
1. Tenant Sign-Off
This documentation will be proof that the resident accepts the property in the condition that you’re giving it to them. We recommend having paper documentation, which could be a checklist or a set of detailed notes. You should also take a number of high-quality photographs. When you have a paper checklist or condition report, you can have the resident sign the document, agreeing to the property’s condition. This isn’t a mechanical inspection, it’s more cosmetic and it allows you and your tenants to agree on how the property looks.
2. Proves Habitability
When you document the property’s condition prior to move in, you can avoid any potential later accusations from the renter that there were habitability issues. You documented the smoke detectors were working and attached, for example. You will have photos as well as written documentation.
3. Identifies Property Changes
Some tenants make changes to the house that are great, and others make changes that seem confusing or unappealing. With your documentation, you’ll be able to determine whether any of those unauthorized changes were made by your tenants. It will be easy to see that the walls were not originally pink, for example. This documentation will allow you to see and prove the changes.
4. Tenant Damage
Distinguishing between tenant damage and normal wear and tear is one of the biggest challenges for landlords. This documentation will help you demonstrate any damage that was done by the tenants. Hopefully there won’t be any damage at all after move out, but if there is, you have the original documentation and proof of what the property looked like when the lease started.
These are just a few of the reasons why documentation is so critical. If you have questions about this or anything pertaining to property management in Kansas City, please contact us at Home Rental Services.
5 Clauses You Should Have in Your Overland Park Lease [VIDEO]
Overland Park landlords need to have a strong lease because this is the document that will protect you, your property, and your tenant. Today, we are sharing five specific clauses that you need to include in that lease.
Due Dates and Penalties
Have the rent due date clearly listed in your lease. That sounds logical, but you need to have the due date and the date that rent is considered late. Make sure you include late fees, and we highly recommend that you enforce those late fees.
Subleasing the Property
Include language that does not allow your Overland Park tenants to sublease the property. You don’t want your renter to move in and then a couple of months later when they decide they don’t want to live there anymore, they sublease it to their buddy who has friends moving in, and you don’t even know who is living there.
Authorized Occupants
List every occupant who is authorized to live in the property. That would include children. Put first and last names because sometimes families have different last names. So, list the first and last name of every adult and child on your lease.
Maintenance Responsibilities
Your lease should list any maintenance responsibilities that belong to your Overland Park renters. Typically, that would include raking leaves in a single-family home or a duplex, changing the furnace filters, and any other duties that you need the tenant to understand. Make sure the details are explicitly explained in the lease.
Timely Reporting of Maintenance
In your lease, you should require the tenants to report maintenance issues to you on a timely basis. You don’t want the leaky toilet to become a soggy ceiling that runs up thousands of dollars worth of damage. So, put this requirement in the lease.
These are the five clauses that every lease should have. If you have questions about Overland Park property management or you need help with a lease, please don’t hesitate to contact us at Home Rental Services.
Real Estate Investing in Overland Park – How to Increase Return on Investment [VIDEO]
Overland Park landlords who want to get the most out of their rental property should follow these six tips that we have gathered throughout our years of experience providing services to Overland Park landlords.
Buy the Right Property at the Right Price
When you’re buying, buy at the right price and leave the emotion out of it. Maybe the home is not the kind of floorplan you look for, and it’s not in an area that you would live. Pick it out based on how a renter would look at it and how it will perform for you financially. You want to buy the best investment property from a tenant perspective.
Assess Your Financial Standing
You need to have enough money to invest in rental real estate. You know your fixed expenses like mortgage, taxes, and insurance. But you’ll also need to consider the age of the roof and the hot water tank. Make sure you have the reserves to cover the things that will come up through normal wear and tear.
Screen Your Tenants
Always make sure you thoroughly screen your Overland Park tenants. It’s better to have a vacant property than a property occupied by tenants who aren’t paying rent or who are doing lots of damage.
Buy in the Right Location
Pay attention to the area that you’re considering. Look for something with high job growth and good schools. These things will keep long term tenants and ensure you always have a large pool of available renters.
Consider Maintenance Needs
Know your limits when it comes to maintenance. It’s always better to hire a professional than to try and do it yourself. Repairs that are not made correctly will only cause more damage and increase your expenses.
Familiarize Yourself with Laws
Know the laws of your state, county, HOA, and the federal government. Not adhering to the laws as written or not knowing them can cost you a lot of money.
If you are looking for additional Overland Park landlord advice, or you have questions about Overland Park property management, please contact us at Home Rental Services. We provide leasing and management services to investors all over the Kansas City area, and we’d love to tell you more.
The Sale Before the Sale… Why We Love Estate Sales
Author: Paul Branton
If you’ve visited my LinkedIn profile, you may have seen that I list the following items in my professional headline: Director of Investor Services | Real Estate Consultant | Project Manager | Estate Sale Enthusiast | Ice Cream Aficionado.
Today, I would like to take a moment to talk about the “Estate Sale Enthusiast” side of my life and introduce you to a not-so-secret, secret…. You can see a lot of great houses by attending estate sales! In the past year, I’ve been able to attend estate sales all across the KC Metro including Olathe, Lenexa, Lee’s Summit, Raymore, Prairie Village, Leawood, Stilwell, Overland Park and Mission Hills.
The other secret about estate sales is that they almost always precede or coincide with the home going on the market. It’s the sale before the sale. So, by going to the estate sale, you are able to get a sneak peek of the house and you may discover it’s a worthwhile investment opportunity!
I understand the purpose of going to an estate sale for the majority of people is to score a great deal on some furniture, housewares, jewelry or perhaps a vintage figurine. For me, it’s more about seeing the house. I enjoy seeing the old construction with vintage décor and original woodwork. I enjoy seeing the older home that’s been renovated to meet today’s modern tastes, and I enjoy getting lost in the custom built, Italian marble adorned mansion that has rooms for days.
Don’t get me wrong, I also try to find great deals. After finding something, I think about whether or not my wife will give me “the look” when I bring this “treasure” into our home; then, and only then, do I decide if it’s a worthwhile purchase.
Here are a few of those items:
Here’s a tip for finding out the details on estate sales. It’s a website called www.estatesales.net and more recently, they released an app which is super handy while on the go! It will tell you where the nearest estate sales are, provide you with all the details of the sale and give you directions!
Let me know if you end up using the app or if you have your own treasure stories to tell about estate sales!
4 Tips on Taking Great Photos to Get Your Investment Property Rented Quickly in Overland Park [VIDEO]
Research shows that you should have at least 8 to 10 good photographs of a property to draw the most interest from prospective tenants. Today, we are helping Overland Park landlords take better marketing photos. These tips will help you rent out your investment property quickly.
Take Pictures During Vacancy
Take your pictures while the property is vacant. That way, you don’t have any personal items interfering with the pictures or causing distractions. You can lightly stage the property, not with furniture, but with accents like towels in the bathroom and a candle, or a teapot on the stove in the kitchen. These things will provide a homey feel for your photos.
Interior and Exterior Photos are Needed
Pay attention to where you are taking pictures. Outside photos are needed for sure, and you should take two to three pictures of your kitchen, even if it’s small. You’ll need a photo of the master bedroom and the bathroom, as well as the living area. When you’re taking a picture of the bathroom, make sure the toilet lid is down. Pay attention to those details.
Avoid Shadows
Think about the time of day you’re taking pictures. If you show up to the house and you look at the front of the house and there are lots of shadows, come back when there’s more direct sun, or when the sun is not creating so many shadows. Even pictures on a cloudy day would be better.
Focus on Angle
Pay attention to your angle. Not every house looks beautiful in a photo straight on. Angle it when necessary. Always minimize the amount of driveway you see. More sky and less driveway is more flattering. Inside, don’t take all the pictures standing from your eye level. Think about squatting or taking a photo from cabinet height so people get a different viewpoint.
These four tips should help Overland Park landlords take better marketing photos. If you need help with your picture taking, or you have questions out Overland Park property management, please contact us at Home Rental Services.
