Archive for Property Management
Tips for Choosing a Property Management Company
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Me and Jesus....well...not really...at Compassion International in Colorado Springs
Greetings from Santa Barbra, CA….. rainy and gloomy….but the hope for sun tomorrow.
Anyway….
Here in CA to rub shoulders with the folks of Yardi Software and to checkout the sites. The rain has not stopped me….
Before I arrived in CA….I was in Colorado visiting my mentor Wes Roberts. So….I have been on a mini-travel marathon of sorts….next? ….D.C.
Today’s topic is property management. Specifically, hiring a property management company…..
Over the years, I have learned the hard way about property management. In reality, good property management is difficult to find. More specifically, “okay” property management is a gem if you find it. I know… I know…I may be going a little overboard….but I digress.
So….I was thinking….what makes a good property management company (PM)…for both commercial and residential assets…..and here is my list….very short….but enough to give you some thought….
1) A PM needs to have a solid understanding of the asset being managed. In other words, does the PM know how to manage a retail shopping center, or a large apartment complex, etc. You see, just because a PM has managed an apartment before…does not mean he or she knows how to managed a 100 unit apartment or a 500 unit apartment. Take a look at the portfolio the PM is managing currently and see where the PM’s experience is. If you want a PM to manage your storage units and the PM’s experience is only in residential homes….you have a big red flag
2) A Good software system. If your PM is using Microsoft Excel to manage a portfolio….you should run. MRI, Yardi, etc….are great software programs that offer clients a lot of bells and whistles. Make sure your PM is using solid systems because…PM reporting, accounting, etc…. is depending on it.
3) Turn-around times a.k.a., “make-ready” time is crucial. PM that are slow at turn-around times when a property goes vacant and the time it takes to get ready for the next tenant is crucial. Whether you have a waiting list or no list at all….having units available quickly will help your bottom line. Find out how fast your potential PM is turning things around by asking other clients what the turn-around time is. If you hear ten business days…then that is too long. One week is the most I can deal with. I like to hear three days. Obviously there are other factors that go into turn-around time…but the shorter the better.
Santa Barbra, CA
4) Communication. Another difficult thing I have learned is if you are having a hard time connecting with the PM….you are probably getting screwed. No return phone calls…..reports have not shown up……etc. Especially for long-distance properties. Talk to the PM’s other clients…ask what the communication is like. Knowing the communication process and how others perceive it will save you a lot of headaches.
5) Network. Talk to other owners about which PMs they use. Ask a ton of questions…how long? What types of assets do they manage? etc. I always like to get a perspective from other investors and see who they recommend. Does it always work? No…but….it is better to get a short list from people you know vs. starting cold.
Anyway…I could go on and on….and I am sure I will on another post….
Until next time……rob
Property Management Software
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Property Management Software?
Greetings from the metropolis of Cedar Crest New Mexico.
VBS (Vacation Bible School) is on my agenda every morning this week….and I could not be happier. I have the 4th and 5th graders and they are just too cool. Reminds me of what is important….or at least what I know is important.
Anyway…today’s topic is property management software. This is a big deal when your residential and commercial portfolio starts to grow. When I first started out, I used excel spreadsheets…then excel and quick books then Mike Butler’s Investor Books made EZ. Today…after a hundred thousand or so invested in implementation and purshase costs (a lot was because of mistakes on my part) I now use Yardi Voyager. I have used Yardi Voyager for over three years and it is probably the best on the market….but comes with a HUGE price tag…especially the implementation costs. Mind you, it manages the books and tenants for retail shopping centers, a mobile home park, storage center, hundreds of apartment units, large industrial and manufacturing, land, etc. So…if you are new to investing….you will probably not need the power of Yardi…but you will need something. So….here are our thoughts….
Property Management Software
Are you still keeping a physical ledger? Do you still balance your incoming rents and expenses through a hardbound checkbook? With the current outlook focusing on spending time and money wisely, it is a good time to evaluate your own processes to see where you are spending too much time and money.
Property Management Software Overview
More and more people are comfortable paying their bills online. Some people have even opted for paperless bills and statements. While this approach is “green” because it does not contribute to depleting trees, it also saves time and money. But, online bill paying is just the beginning of electronically managing your assets. There are a wide variety of products available for managing your property and investments electronically.
A Few Good Options
This article will outline a few popular software programs for managing your rental properties. This is not an all-encompassing review, but a general overview of some of the options available. Make sure to check software review sites like www.propertymanagementsoftwarereview.com or www.cpatechnologyadvisor.com.
$99-$149
One of the more popular options is a version of Quicken® that will allow you to manage your personal finances as well as your rental property. According to the software website, you can run tax and tenant reports, reconcile statements, determine which tenants haven’t paid, organize deductions, store tenant contact information, lease terms, security deposits and payment histories in one location. To find out more, visit http://quicken.intuit.com
$250-$400
Another software option is RentRight®. This software package, according to the website, is designed to help owners of 50 units or less and features pop-up reminders for late paying tenants and expiring leases. The software also features extensive reporting under the following categories: income, expense, invoices and building reports. The software also integrates with an additional program to perform background screening for an additional cost. For more information, visit http://www.rent-right.com.
$500 Plus
Manage-IT Pro® by LogicBuilt, inc. has received very good ratings from software review companies. According to the website, the software is more robust than some of the cheaper options with substantial accounting capabilities like cash/accrual, automated journal transfer, void and rewriting checks, bank reconciliation, automated late fees, defined item type for vendor payables and several other options. The property management functions include automated pop-ups, applicant prospecting information, integrated letter writing, searching vacant units, paperless office document systems and several other features. To find out more, visit, www.logicbuilt.com.
All noted trademarks are the intellectual property of the respective trademark owners. TheRealWealthBlog.com and any of its proprietors do not endorse or maintain the validity of any one software product. As with any product purchase, do your research! Read user reviews, look at the product specifications and read any applicable blog posts to make sure it is a good investment for you.
Until next time……rob
Property Management – Save Thousands on Property Repairs
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roger maupin
Howdy everyone from the great state of Texas! I moved to Austin this year from Denver, CO and loving it. Though I do miss Denver, sailing my boat on Lake Travis helps me deal with it.
Being a real estate investor for half of my life, I have learned a lot from my mistakes. Today, I want to share with you what I have learned regarding property repairs.
Learn to look for hidden stories in the details. Look at numbers in a new way, with a different eye. You don’t need a degree in engineering to Save Money on Property Repairs.
In my 23 years as a property owner, I have learned to routinely scrutinize quotes before any work is approved. Two quotes for the same job can vary enormously. Just by applying the following steps you can save up to 75% on repairs…no kidding. That means you can save thousands that will go directly to your bottom line….
Here are the four easy (well…not so easy) steps to save thousands….
Examine estimated quote charges…..
- Get at least three quotes – Discard any ‘distorted’ quote which is significantly higher or lower than others. Also…beware and have your “eyes wide open” ….scams happen.
- separate labor and materials costs
- break each (labor, materials) down into specific jobs comprising the larger project
- itemize the costs for each job of the project - Qotes must specifically list all materials and estimated labor in order to be evaluated. Vague quotes are impossible to judge.
Questions to ask yourself…..
- Is the labor charge reasonable? – make sure think through actual steps required for the project
- Is the material charge reasonable? If you don’t know what is unreasonable, do a quick Internet search entering make, model and other relevant numbers to verify the exact item
- Should you repair or replace
Here are “real-life” examples of true savings:
An apartment complex needing serious roof and chimney repairs. Here is how the situation went down:
Original Bid
- Remove 4 leaning pony walls and repair roof @$2600 ea =$10,400
- Install 48 sheet metal chimney caps @$525 ea=$25,200
$ 35,600 original bid
$ 9,900 final quote
$ 25,700 saved!
A whopping savings of 25K…..just by getting more bids, questioning the quoted price and discarding the high quote. Easy huh?
Here is another example with the same apartment complex where the boiler pump went out in the middle of the night….fun right?
Here is the sco
$ 750 contractor charge for new boiler pump
$ 223 online price
$ 537 saved!
Situation: Staircase repair:
$ 3,100 original bid for replacing entire stair structure
< $ 952 materials and labor after scrutiny
$ 2,148 saved!
How?
· Requested pictures from the contractor
· Discussed project with contractor/welder
· Found alternative solution
· Replaced only steps instead of entire stair structure
If you have questions, suggestions, or experience saving (or losing) money on property repairs, let us know. We can all benefit.