Last week, we started discussing the early work to position yourself strongly for a tenant renewal scenario. (http://danbaldini.com/2016/10/24/treats-instead-of-tricks/) This week, let’s conclude the article. 1. The Approach Let’s assume you have one of two options for the renewal scenario: You plan on keeping the rent the same as in prior years or you plan on asking for a rental rate increase. Same rent scenario: This one is easier, but be prepared for the tenant to ask for a possible rent reduction or other concessions. Their argument could be as basic as,”Hey–you don’t have to search for a new tenant, so how about knocking $25 off our rent for the next year?” or “Hey–can you replace the carpet and we’ll agree to renew?” Whatever their request is….be prepared to know your numbers (i.e. profit margin) in order to know if you can do it or not. In addition, if the request […]
Landlords and Investors make money the same way airlines, hotels, and entertainment shows do–they keep butts in seats for as long as possible. For real estate, this means maximizing Days of Occupancy and correspondingly minimizing Vacancy Days. So this Fall let’s review some of the Best Practices to give your Tenants Treats instead of Tricks for their lease situation. 1. Advance Communication The saying, “Misery is the mismatch of expectations between two people”, holds true in rentals. If you are communicating with the tenants at the time of their initial lease signing that you’ll be recontacting them to begin discussing the possibility of renewing their lease 60-90 days before the lease ends, you’ve planted the seed early on that your not the kind of landlord who waits until the last minute for these conversations. Good for you. 2. Review of the Market Conditions Before you pick up that phone or begin […]
The rental market areas for Indianapolis and surrounding communities continues to maintain momentum into Fall 2016. Here’s the updated stats through August 2016. indy-rental-stats-ytd-through-august-2016 As always, if you have specific market questions or would like more in depth analysis and projections for your personal portfolio, just call or click.
If you’ve ever read any of the feel-good books like Tuesday’s With Morrie or self-help books like Stephen Covey’s 7 Habits of Highly Effective People, you already know about the concept of “vampire time-suck“. This is the person or situation that sucks the valuable time (aka “your blood”) out of you by attending certain meetings, taking certain phone calls, and completing to-do’s. If you think even for 30 seconds here, you can mentally picture that co-worker or vendor or daily/weekly job task that fills this time-suck, can’t you? Me too. Why do I bring this up today? Because one of my property management Clients reminded me how this concept intersects with the financial concept of “discounting value of money”. Here’s the basic concept: A dollar earned or saved today is worth more than a dollar earned or saved in the future. It’s the method used to bring future projected cash […]
Kids like bubbles. Even dogs like bubbles. Real Estate Investors typically don’t like bubbles. But it doesn’t have to be that way if you think about it…. A recent article on CNBC highlights the possible statistics pointing to another Housing Bubble for specific States and Cities in the US. However, unlike the last major bubble, the underlying forces causing this bubble are distinctively different. Here’s the full article link: http://www.cnbc.com/2016/08/29/were-in-a-new-housing-bubble-why-its-less-scary-this-time.html My favorite Take-Away paragraph from the entire article is this…. “Rental demand, especially for single-family homes, is very strong and is an attractive income stream for individual investors and current homeowners. As millennials age into their prime homebuying years, more than ever before they are choosing to rent single family-homes, because they either don’t meet mortgage credit requirements or are unable to save for a down payment because rents are so high.” So, if you’re worried how the housing […]
Things happen when you run a rental property operation. That’s why there’s the phrase you see on bumper stickers that says “**** Happens.” As such, two primary choices present themselves: Be absolutely rigid and unbending in your policies and procedures….or…..Be absolutely flexible and have strength in your policies and procedures. What I mean is captured in this video below. As you watch it, consider the possible scenarios in your minds and do the metaphorical application to your rental properties, your tenants, and your landlord clients if you are a property manager. So….Is your operation flexible and strong enough to break your ‘cement blocks’? Or will you end up crushing all 27 bones in your hand?
You’ve heard of Crowdfunding for all kinds of funky new products and companies, but real estate? No, you’re not doing a double take. Yup. It’s here. Check out this article about crowdfunding and how it can impact your Retirement Plans. http://money.usnews.com/investing/articles/2016-08-23/pros-and-cons-of-real-estate-crowdfunding-for-retirement
Over many years of coaching Landlords, Investors, and Real Estate Agents I’ve come to this conclusion: Your Dreams and Nightmares are always about THE SAME THING. Your most dreamed about issue? It is always making large amounts of money so they can have Financial Freedom. It’s you visualizing their bank account balance swelling up. It’s you visualizing your ROI numbers and seeing it start with a larger integer than last year. Your most Nightmarish issue? It is always procrastinating the grunt work of actually running the financials on your rental properties. It’s “stepping on the scale”. It’s the attitude of “What I don’t know can’t hurt me, right?” “If I don’t look at the numbers, they’ll certainly improve on their own….” I’ve learned that I can ask clients to run a simple worksheet and they don’t want to do it. They’d rather talk to 10 life insurance salesmen than actually get a […]
Questions. We all have them. (If you don’t, run away from real estate.) Here’s the Top 20 questions asked by landlords and investors when choosing to hire a property management company. Some are deeper questions than they might seem the first time you read them, which is why the first question on the list is the first question on the list. If you are thinking about them in the correct mindset, you should realize within 2 breaths that the questions spawn subordinate questions and will take you down a rabbit hole even further. What do you charge? If I have a question and send in an email or call, what is the expected response time from your company? Is the prop mgr available on weekends if issues arise? How do you handle repairs? How does money get to me each month? What happens if the tenant doesn’t pay rent? What […]
Good afternoon! We have published the YTD Rental Stats for the 14 market areas we track in the Indianapolis area. We have also changed this to a protected file format since it is proprietary data analysis unlike anyone else provides and have started to charge for this data. The whopping amount for access? $5 To change your membership from the free level to the Financial Freedom Member Level, click here. Skip the Starbucks once a week to skip faster into your Financial Freedom. Do it. You’ll thank me each month as you keep watching your bank account gro July 2016 YTD Indy Rental Stats