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Blog: Rental Property

3 Problems I Avoid When Shopping for a Rental Property

Aug 26 2017
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The following are three problems I try to avoid when I look for a rental property. This isn’t to say I will never touch a property that has one of these issues, but there better be a really good reason for it, and I would have to factor it into my numbers.

3 Problems I Avoid When Shopping for a Rental Property

1. Neighborhood

You cannot easily fix a neighborhood. Sure, you could join the local city council and start a neighborhood watch, but the neighborhood is not likely going to change because you want it to. Therefore, I don’t want to buy a property where the neighborhood will always be an unsolvable problem.

The property will continually be difficult to rent, the tenants will trash the house, I’ll have to deal with evictions and late rent, and in the end, the property’s value may never increase (and might actually decrease). I’m not saying I will only buy in a Class A neighborhood, but I’m definitely not going to buy in a Class D area.

The 5 Most Common Reasons Tenants Leave Your Rentals

Aug 12 2017
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Why are renters leaving your units? What can you do about it? Tenants are on the move. What are the most common reasons they may leave your rentals? How can landlords prevent these moves to keep good tenants, maintain consistent cash flow, and maximize cash flow?

The 5 Most Common Reasons Tenants Leave Your Rentals

1. They want to move somewhere cheaper.

Housing costs, especially rents, have been rising for the last five years. Some are just at the point where it makes sense to move somewhere cheaper where renters can get a lot more for their money. It could be that local rents have just gotten too high—or maybe your rents in particular are too high.

Market rents change over time. Be sure you stay tuned into local trends, even when you aren’t actively looking for tenants. If neighboring properties are leasing for 30% less than yours, that could become an issue. Price your properties right. Invest in stable and upcoming locations with more room for growth.

12 Rental Property Improvements You Can Make for Under $500

Jul 22 2017
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Need to upgrade a rental unit on budget? Here are 12 improvements landlords can make for under $500 each.

12 Rental Property Improvements You Can Make for Under $500

1. Paint

You may not be able to paint a whole house for $500, but you can enhance key rooms and create accent walls. Trending colors this year may include grays, beiges, greens, and pinks.

2. Change Out Flooring

The same applies to flooring. In cheap rentals, you may be able to use vinyl or focus on small, key areas of flooring. Putting new flooring in small entry areas and bathrooms or replacing the carpet in that one ugly bedroom could make a big difference in renting quickly and for more money.

3. Patch the Roof

Roof leaks can cause major havoc with rentals. They can quickly deteriorate your asset, cause ballooning repair bills, add to the maintenance interaction burden with tenants, and can lead to damage of renter belongings, which you may be on the hook for. In many cases you don’t need a new roof, just patches.

How to Maximize Revenue While Minimizing Vacancy in Real Estate

Apr 01 2017
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One of the most important components to owning investment property is pricing your rental appropriately so that you maximize revenue while minimizing vacancy. Determining what to rent a property for can be somewhat of a science when trying to optimize your ROI. You will want to employ several different techniques and strategies when determining the right amount to charge for rent:

Shop Around

One of the most accurate and easiest ways to figure out what the market will bear in rents is by checking out the area.

This requires a little leg work on your part, but is going to give you the most realistic look at what you are facing. You can often find rental signs in the area posted with rental amounts, number of bedrooms and other details about the property. Calling these landlords and getting info on what they have for rent and what they are charging is a great way to get a feel for market.

The newspaper or online classifieds is another excellent way to check out what is available for rent in that area, Not only do you want to see what others are charging, you want to see how long it stays listed at that price. If properties are renting quickly at certain prices, you know that there may be room to price slightly higher.

 

5 Tips for Owning Low-Income Rentals in Less-Than-Ideal Neighborhoods

Mar 17 2017
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Low income properties may seem like the worst meal on the table, but that doesn’t have to be the case. If you know how to invest successfully in these types of properties, you can actually make a good profit out of it. You may ask me how I can say this so confidently. I’d like to tell you my own experience with this. I picked up not one, but two of the cheapest houses in America. They weren’t in great locations, but I got an amazing can’t-be-missed deal for the both of them. And what’s that deal, you may ask? Well, you may have heard of properties that get sold for $1,000 or even as little as a $100. Here’s the thing: I spent even less on these properties.

7 Tips to Maintain Your Roof and Gutters

Feb 17 2017
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John F. Kennedy said, “The time to repair the roof is when the sun is shining.”Sometimes it’s easy to forget about the areas of your home you don’t see everyday, but that’s exactly when problems arise. Stay ahead of repairs by regularly inspecting them to avoid worse problems later.The roof and gutters on your rental property can be easily neglected, but with a little proactive maintenance you can protect your rental and avoid costly repairs.

Maintenance Tips for Roof and Gutters

  • Replace curling, buckling or cracking shingles

2017: Year of the Renter

New York renters would be the first to tell you that rents go in only one direction: up. But after a long and relentless climb to historic highs, the momentum has stalled.

With renters unwilling, or unable, to pay ever higher sums, rents have largely flatlined. And it seems we have come to the year of the renter’s market.

In Manhattan, Brooklyn and Queens, inventories and vacancies are up, and landlords are offering new tenants discounts, like several months of free rent and no broker’s fee. In the Bronx and Staten Island, rents are holding steady because those boroughs did not experience the same rapid rent escalations or volume of new development. But that could change when new rental buildings open in both boroughs this year and in 2018.

The biggest deals are happening at the top of the market, where some luxury developments are offering as much as four months of free rent on a two-year lease. But deals are to be had in older, less expensive buildings, too. Despite these concessions, some apartments linger vacant for months. Worried that a slowdown will continue, many landlords are not raising the rent when leases come up for renewal, and some are even throwing in perks like gift cards.

Many landlords and real estate brokers attribute the renter-friendly trend to an influx of new apartments: 11,514 new rental units came on the market in Manhattan and Brooklyn in 2016, and 13,340 are expected this year, according to Citi Habitats, a real estate brokerage. The large number of condominium apartments that investors have turned into rentals has added to the glut. These apartments are mostly luxury rentals, and too expensive for many New Yorkers. So tenants with smaller budgets are fanning out to neighborhoods like Crown Heights, Brooklyn, and Jersey City.

5 Key Research Findings About Tenants And Rentals

As property managers and owners you want to know what keeps tenants happy. And what keeps them around and also what can set you apart from the competition. This article will help you in your rental housing business.  A new survey designed to help property managers and owners gain insight into what tenants care about the most in their apartments shows insight on:

 - What will they pay more for?
 - What drives them crazy?
 - What makes them happy?
 - What makes them sign a lease or renew a lease?
 - What makes them move on from a property?

Tenant Screening: Finding the Perfect Renter

In this guide, you’ll learn how to qualify every prospective renter who contacts you by eliminating unqualified and problem tenants early in the application process through proper tenant screening. You may feel like you don’t have the time to screen every renter carefully — after all, each day your rental is vacant, you are losing money — but tenant screening is one of the most critical aspects of the leasing process. Lead qualification will help you weed out poor tenants, leaving you with responsible, long-term renters at your property. Here are several steps landlords should take to find the best tenants.

3 Tips To Help Make Your Rental Property More Attractive

While making the decision to purchase and then rent out a property is one thing, the way in which you attract tenants to fill your units or homes is another. In fact, before you make the purchase, you should also be thinking about ways to entice users to fill your property's units or homes.

One of the services that we provide at Onyx Management Group consists of helping our clients find tenants. How do we do it? Well, we make a property look appealing to the point that an individual cannot say “no!”

Over the years, we have found many ways to help our clients make their properties look more attractive. Therefore, we decided to put together a list of a few tips that we believe will help make any rental property more attractive to prospective tenants.

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If you’ve ever considered investing in a few rental properties in Philadelphia or Bucks County, PA now might be a good time. Prices are still low in Philadelphia, but have been on the upswing. According to the National Association of Realtors, the median price of an existing home in a US metropolitan area grew 13.7% between July 2012 and July 2013, the latest in a 17-month streak of year-over-year price increases. 

New landlords can choose from properties that are likely to appreciate and a large pool of potential renters.Licensed realtor Pat Mueller cites a few reasons for this trend: “Many families have lost their homes to foreclosure and are entering the rentals market for the first time in years. Mortgages are also harder to get now, so fewer people are qualifying for a new one.”The more skills you bring to the table to get into Houses for Rent in Philadelphia Philadelphia or Bucks County, PA and the more time you have to devote to your properties, the faster you can make a return on your investment. 

But investing in rentals can also be disastrous (or too stressful to be worthwhile) without expertise. Here are three professionals you may consult about your new rental properties, and what you can do to mitigate how much they cost you:Handyman:  You may need to hire a specialist for some work on your rental. If you need new outlets or new pipes, for example, hire an electrician, plumber or licensed contractor. Handymen usually tackle smaller, more manageable tasks, like:

  • Painting and paint removal
  • Drywall repair
  • Minor appliance repairs (fixing a leaky toilet or faucet, among others)
  • Installing tiling or flooring, moldings, windows, doors
  • Refinishing decks, cabinets and other wood items

When You Could Skip It: You could do any (or all) of these projects yourself if you have the time and interest in learning. Of course, this only works if you live relatively close to your rentals and are flexible enough to service them on short notice. And if you’re willing to respond to the occasional 5 AM basement flooding.

Average Savings: Any base rates or costs-per-hour vary from location to location in Philadelphia or Bucks County, PA , but nationally, you can expect to spend an average of $60 to $85 per hour for repair costs. It general costs less to hire an individual handyman than a handyman employed by a company. Expect an additional charge if your job requires a trip to the store for materials.

Resident Property Manager As the owner of a handful of rental properties, you may be able to manage them yourself, but if you want help, a single resident manager would probably be more cost efficient than a property management company. Resident managers may:

  • Serve as a handyman
  • Advertise vacancies in your units
  • Show apartments to prospective tenants
  • Review rental applications
  • Collect rents

When You Could Skip It: Again, the closer you live to your properties and the more spare time you have, the less likely you are to need a manager. The obligations of being a boss will also cut into the time you save on maintenance.

Average Savings: The national median wage for residential managers is just over $25 per hour. Research the wages in your community and adjust according to how much responsibility your manager will take on. 

Real Estate Agent: Once you’ve gotten your financials in order and done your own research on the neighborhood(s) you’re considering, you might contact a realtor to show you potential properties. You can also arrange for a realtor in Philadelphia or Bucks County, PA to show rentals once they’re ready to rent.

When You Could Skip It: It depends. Even if you’re a local, or have thoroughly researched the neighborhood(s) you’re considering, a realtor is a great resource for a first-time rental buyer. Realtors have access to data and statistics not necessarily available to the general public and first-time buyers may not know all the right questions to ask. Using a realtor to fill your Houses for Rent vacancies is less of a no-brainer, depending on your other time commitments or whether you plan to hire a resident manager who could do the same thing.

Average Savings: As a buyer of rental properties, as when buying your own home, sellers typically pay most, if not all, of the buyer’s realtor fees. In this case, Mueller points out there’s little reason not to work with a realtor. For help in filling your units in Philadelphia or Bucks County, PA, the services of a realtor would set you back between 10-20% of the unit’s rent per month.  Mueller recommends interviewing with several brokers before making your final decision to invest into Houses for Rent .

The Bottom Line: As a new landlord, you can’t necessarily control the flexibility of your schedule or the amount (and cost) of unexpected repairs to your properties. Rentals are a long-term investment. However, to maximize profits from your Houses for Rent, new rentals, you can buy close to home and start small. It is best to begin with just one or two properties. This will allow you to maximize the time you spend on your properties’ needs, and minimize the amount you’ll have to pay anyone else.

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