Property Management Nation

Entries from June 2009

What will become of Neverland Ranch?

June 29, 2009 · Leave a Comment

Whatever your opinion of Michael Jackson, it is impossible to deny that the country has lost a celebrity personality. With much discussion still roiling in regard to his passing, many are still trying to come to grips with the fact that he is actually gone. But with armies of helpers, executive assistants, investment specialists, publicists and the like, some affected by Jackson’s death are merely left to the mundane realities of day to day business.

One question an investment management team somewhere is struggling with, is what happens to Neverland Valley Ranch?

Thankfully we don’t live in France where the laws regarding death and property are about as straightforward as a daytime soap plot arc, but a question that will soon need to be answered is, “what will be done with the mansion/zoo/ranch now?

According to multiple sources, an investment firm called Colony Capital, LLC owns most of Neverland Ranch, with Jackson’s estate owning a small portion. The property was almost auctioned off in mid 2008 as a result of non-payment of debts run up from fighting molestation charges against Jackson, but the loan was purchased by Colony Capital last May. Further research reveals that the sale or transfer was a joint venture between Jackson and Sycamore Valley Ranch LLC, an affiliate of Colony Capital, LLC.

So what does this mean for both Colony Capital as investor/managers and whomever is now potentially in charge of Jackson’s portion of the estate?

Colony Capital, LLC which owns, among other investments, Raffles International and the french professional soccer team Paris Saint-Germain, is a worldwide investment LLC. According to a Billboard article released yesterday, Colony is in talks with Tohme Tohme, Jackson’s former manager, to potentially have Jackson buried at Neverland Ranch and become an attraction akin to Graceland. However, the small town of Los Olivos isn’t gung ho about the prospect of their sleepy town being inundated with tourists year ’round.

This type of property management, where $120 million properties are sold and traded like plastic monopoly houses becomes its own phenomenon. Whatever happens, no one will ever be able to think of Neverland Ranch as anything other than the Michael Jackson’s one-time home. Will that make the property more or less valuable? Only time will tell.

Categories: food for thought · property management
Tagged: ,

Through the Property Investment Looking Glass

June 26, 2009 · Leave a Comment

Like Alice, everyone hates getting out of their comfort zone, that’s why it’s a comfort zone. For Newsweek journalist Daniel McGinn, I’d usually say it was all in a day’s work, but in his recent article “The Accidental Slumlord” McGinn goes down the rabbit hole and makes it personal, by sharing his experiences of visiting his own low income duplex investment property in Pocatello, ID for the first time.

McGinn has also written a book, House Lust, published in early 2008 which, in addition to analyzing the country’s recent obsession with houses, chronicles his first foray into investment property ownership and the life of the distant landlord.  “The Accidental Slumlord” brings him face to face with his tenants and the realities of owning a (frankly) rundown, beat up, sketchtastic property.

McGinn sees what $690 in combined monthly rent affords in the town of Pocatello, ID. Bringing humanity to the lower priced investment housing “steals” during the property boom of the last ten years, McGinn shows both sides of his situation: a compassionate soul who wants to help those less fortunate as much as the next guy, and the investment property owner who is trying to make a profit from, technically, other people’s rock vs. hard place situations.

Flying the 2,450 miles from Boston to Pocatello to essentially answer the question, “what is my investment currently worth” was a real eye opener for McGinn. From the pictures he saw of the place prior to purchase, he knew it was no castle, and from the rental rates he charged, he understood his target market wasn’t swimming in disposable income, but he was unprepared to confront the realities of the tenants he currently housed and how his investment depended solely on them, and people like them, to continue to rent in his subpar building.

Surprised to learn his investment had actually appreciated (a local appraiser said he could sell it for nearly 20% more than what he paid for it) McGinn feels luckier than many of those who belly flopped once the housing market went bust. And while he plans to hang on to his property and ride out the economic valley of today, he has given himself and investors everywhere food for thought about where their cashflow is actually coming from.

The question that springs to mind for me, is: now that the housing bubble has burst, how many more real estate investors inadvertently sold their souls to the devil for a reliable cashflow? McGinn talks about how it’s much more uncomfortable to deal with rental increases, “smart investment” repairs and evictions now that he has met his tenants, as opposed to referencing them as merely names on contracts. And yet still, as a landlord, he has to hope that either his tenants stay or that renters who are equally down on their luck take their places.

I grant you, not all investment properties were purchased for $62,000 and have the same target renter pool or issues that McGinn’s has, however, it brings up the interesting dichotemy of investment property owner vs. landlord. How many investment owners are “accidental slumlords” like McGinn?

Categories: food for thought

Life (and Yardwork) After Foreclosure

June 24, 2009 · 1 Comment

And you thought foreclosure was as bad as it could get.

With foreclosure rates the highest they’ve been in recent history, cities across the country are having issues with vacant houses: lawns are unkempt, dumped trash stands in the driveways, and these uninhabited buildings are prime targets for vandalism and graffiti. It’s creeping  neighbors out, lowering property values even further, and its starting to cost former owners.

Many owners who have been foreclosed on simply leave their homes, neglecting that it is still their responsibility to keep them up. Even when properties are transferred to the lender or bank, many fall into disrepair and quickly turn into eyesores.

St. Louis, MO as well as nearby Collinsville, IL are two places that have taken notice. Police and community service officers are using tickets and liens to get homeowners or banks to get houses back into presentable shape.

The City of St. Louis is also considering a bill that will require houses that have been foreclosed on  to register with the city, so that the city will always have a point of contact if there is an issue with the property.

While foreclosure is undoubtedly enough of an ordeal for any homeowner to suffer, it feels almost like rubbing salt in the wound that they should then have to care for the property until it is purchased. However, I suppose this falls under one of the risks a home buyer takes when he or she decides to purchase a property.

Sadly, today, it seems the sting of foreclosure may wear off long before the responsibilities of a lost home are at an end. Perhaps property managers have found a new niche in today’s market– looking after foreclosed homes for their former owners until they are sold.

http://suburbanjournals.stltoday.com/articles/2009/06/23/madison/special_feature/0621cvj-foreclosures.txt

Categories: property management

5 Ways to Bring out your Rental’s Outer Beauty

June 19, 2009 · Leave a Comment

Summer starts officially on Sunday, and the warm weather, or promise of it, has people from Seattle to San Diego to Sarasota scrutinizing the outdoor look of their house as much as the inside. For property managers seeking to rent out a home or apartment, curb appeal, added amenities, and a tidy exterior are just as important as if the space were up for sale. Here are some quick fix tips to help spruce up the outer beauty of your property and make it that much more marketable as rental season rockets.

1. Shrubs, flowers and potted plants, oh my!

(Photo by: Spixey )

Flora and greenery of all kinds are a welcome way to brighten up a dour looking front stoop. Rows of plants or pots create boundaries for space, making a lawn or porch look more organized, welcoming and colorful.Conversely, if you have more foliage than you know what to do with, do some trimming and weeding to make things more tidy. A quick consultation from a landscaping professional might make all the difference in presentation.

2. Paint, the great equalizer

(Photo by: favouritethings )

While paint can’t solve all of a property’s problems, it can help when things are looking a little droopy. Paint the front door of your property a bright contrasting color; touch up trim, or accents on the exterior of the house; repaint the deck to match the building–any of these can be the eye-brightening revision needed to perk up an otherwise boring exterior.

2. Reduce, reuse, recycle, repeat, reduce, reuse, recycle…

(Photo by: naotakem )

Find some repurposable materials or old furniture to brighten up your outdoor space. Whether it needs a fresh coat of paint (see above), some new cushions, or a few hours of DIY fixing up, unusual and unique outdoor furnishings can add a focal point to your front yard or outdoor space and create added allure for the property. Remember though, if you leave these items as part of the rental property, be prepared for them to be used.

4. Create a room…outdoors!

(Photo by: midnightlounge )

Create a space tenants will want to use outdoors. Whether it’s a clean and tidy private deck, or a more spacious common area, make it a place worth using and it will add to the value and appeal of the property. Furniture is always a handy addition to outdoor common areas, as well as lights, umbrellas and perhaps even a barbecue.

5. Make your space fun for all ages

(Photo by: anne.oeldorf )

If you are working with a large space, particularly with multifamily properties, consider adding something for children. Play spaces will always get used, and for many families, an onsite place to go and run around, jump, climb and generally be rambunctious might be just the added bonus they need.

There are many things to be done to the exterior of a property from a small coat of paint, to installing a value-adding amenity that can brighten it up and make it sparkle. Have fun with the exterior of your property, and welcome summer with a new outdoor perspective!

Categories: Uncategorized

4 Types of Squatters Property Managers Should Avoid

June 16, 2009 · Leave a Comment

There are tenants you just know on sight are bad news. They don’t pay their rent, they are impossible to track down, and they only respond to the most forceful retaliations. Here are four unwanted squatters in buildings that property managers should evict the moment they discover them within their walls.

1. Mold

(Photo: Angela Schmeidel Randall )

Mold can cause surface and structural damage to the building, and health problems to those living in it. High humidity, water leaks, and dark, damp places are ideal conditions for mold, and spore colonies can often start growing out of sight behind wallpaper, molding and underneath paint. Be sure to regularly check areas exposed often to excessive humidity like the bathroom and kitchen, as well as basements and areas that don’t always get proper ventilation for signs of mold growth.

2. Rodents

(Photo:  pasotraspaso )

Ever wonder if you’re not alone in your apartment? Little scratching or scrabbling noises, small mysterious holes in food packages and little trails of small brown pellets can all be indications that the building’s tenants have unwanted roommates. While they might look cute and cuddly, they are certainly not hygienic or good for the building. Families of rodents can be found living in the walls, tearing up insulation and possibly chewing through electrical wires. Sadly the easiest ways to remove these unwanted friends is via traps, but there are some non-lethal ones that allow them to be safely released back into the wild.

3. Insects

(Photo: ItzaFineDay )

Creepy crawlies inside a building are by far (for me) the most alarming, though they may not be the most dangerous. Some types of bugs come in search of blood, others to set up a home inside the building utilizing found materials. If tenants in the house are noticing more than usual bug bites or find an infestation, there is nothing to be done but have these bugs immediately eradicated from the building with insecticides or cone traps.

4. Sick Building Syndrome

(By: Marco Bellucci )

Sick Building Syndrome or SBS, is cited when the building’s occupants have similar, unidentifiable health issues (ie. congestion, difficulty breathing, focusing and extended headaches) when they are inside the building, but which disappear quickly once they leave. Often, SBS can be difficult to diagnose without the help of a professional Indoor Air Quality specialist. If tenants are having similar symptoms that cannot be explained, it might be time to have the building checked out. (note: Also see #1 Mold as it can also cause similar health symptoms in building residents.)

Be vigilant of these tricky visitors as they can sometimes go unnoticed for weeks or even months if you or your tenants don’t know what to look for. As always, if you are unsure of how to deal with one or more of these issues, contact a professional immediately.

All images shown are licensed under a Creative Commons Attribution.

Categories: property management

WWaPMD? (What Would a Property Manager Do?)

June 12, 2009 · Leave a Comment

Today, economic woes seems to nip at everyone’s heels like creepy crawly things from the shadows, but for several residents in Lincoln Crossing, the creepy crawly things have abandoned the shadows and hunkered down on their front lawns.

Foreclosure signs have become a depressingly common sight in many cities and towns across the country. But did you know that some of those signs were put up not by banks or lenders, but by the neighborhood’s homeowner’s association?

One example of this, is the situation in Lincoln Crossing, where approximately 10% of the neighborhood’s 3,000 houses are in some stage of getting behind in payments and facing foreclosure from banks or their own HOA.

Now, I’m not entirely sure how I feel about this situation personally. On one hand, if you choose to purchase a house with a homeowner’s association, you sign the contracts at closing agreeing to all terms and covenants set out by the HOA– which can include foreclosure should you fall behind in your HOA fees.  On the other hand, with the awareness of what’s going on in the economy would a well-timed meeting and the agreement to cut back costs of maintenance and temporarily lower HOA fees in the neighborhood have helped many of these struggling homeowners?

While the article itself presents a sympathetic view of the homeowners, and the comments below the article from local residents aggressively air some tensions between the two factions, I am more interested in what the property manager would have to say about this situation.

A simple search revealed that, “Lincoln Crossing is under the guidance of Merit Property Management.” While I take that to mean they are employing a professional manager of some sort, or at the very least receiving advice from a trained and experienced manager, the manager is curiously absent from the article.

Which leads me to the inevitable question, What Would a Property Manager Do? Obviously, in this situation, the property manager has advised the HOA to go ahead with steps toward foreclosures, but what alternatives might other property managers have suggested? Will this threat of foreclosures end up having more of negative impact on propety values and location than an HOA hiatus?

Categories: Lincoln · property management

Would you give $150 for the chance at half a million?

June 9, 2009 · Leave a Comment

Do you feel lucky? Well, do you? If you do, I’d recommend investing in a raffle ticket down in Irvine, CA. The Irvine Public School’s Foundation(IPSF) is sponsoring a raffle which, for $150 a pop, contestants have the chance to walk away with half a million dollars.

The IPSF has been holding the Dream Raffle for five years now, offering either a new home or a large wad of cash to the lucky winning ticket holder. This year they decided the cash was the best option, because everyone could use their own “personal economic stimulus plan.”

With this year’s decision to have a cash only prize, Erika Chavez raises the interesting point, “Is buying the perfect home still the ultimate [American] dream?”

With so many financial troubles these days, is a house with a picket fence and 2.5 cookie cutter children still the ultimate goal for Americans? Or have new symbols emerged as truly ‘making it’? Education, travel, even retirement–are these all trumping the want for a place of one’s own?

Regardless of what you would do with your cool $500k, you still have some time. The raffle deadline has been extended to July 31st, with a few early raffles for donors who purchase multiple tickets.

So, would you give $150 for the chance at half a million?

To find a property manager in Irvine, click here!

Categories: Uncategorized
Tagged: ,

Just Say No to eRentalApplications.com

June 8, 2009 · 11 Comments

It’s safe to say we’ve gotten to the point where the internet has become the go-to source for most things in life including information, shopping, paying bills, staying connected with friends, and entertainment.

And, once again, this increasing reliance has spawned even more ways to get ripped off.

eRentalApplications.com is a tough cookie to crumble when first you encounter it. It starts, innocently enough, on Craiglist.com. (*note: Before you chastise me, yes I understand Craigslist perhaps isn’t the best place to cite as the paragon of safety and security, but it’s not quite the red light district either so bear with me.)

The posting looks like any other; it might even have pictures and down-to-the-cent information, but it has no other contact besides the anonymous email. Upon sending an email of interest, you receive an email from a gmail account that directs you to use eRentalApplications.com prior to visiting the property. The email generally looks like this:

Hello _________
Please go to www.eRentalApplications.com to fill out a basic rental
application to check tenant history, references, and verify
employment. Your social security is NOT REQUIRED and YOUR CREDIT WILL
NOT BE PULLED at this time. After the application will be reviewed you
will be contacted to set up time to see the property. The process is
simple. Just use the following steps and within minutes your
application will be forwarded for review.
Go to www.eRentalApplications.com and follow these steps:
1.      On the homepage click on the “APPLY TODAY” button
2.      Find the property address (for which you will be applying)
3.      Fill out the application
4.      Pending approval you will be contacted regarding your application
as soon as possible
Thanks.


Upon going to the site, it requires a $14.95 charge via paypal just to submit some of your very personal information, without having even seen the property! Should you take umbrage at this and send another email asking what is so amazing about the property that it costs more than a prime movie ticket and soda just to see the inside, you will likely receive nothing back.

However,after a simple search of these same devious interwebs, I did find multiple ripoffreports, comments on Craigslist reporting it was a scam and even a post on Intelligent Designer, (a local area blog) which outlined the blogger’s experience from a property owner’s perspective. In a nutshell, the Craigslist post of his listing had been stolen, copied, advertised for$200 cheaper than his actual listing, and set to redirect to eRentalApplications.com.

The most frightening part about this scam is that only the very last part of the grift is a lie. It is usually a real posting of a real property with real photos and information. But, upon receiving the email to send in your information, the result could be turning over enough information to have your identity stolen, and your wallet $15 lighter for the privilege.

What do we learn from such despicable behavior?

1. If you’re looking for a place to rent, be wary of Craigslist postings without direct contact information.

2. Do not give away your personal information unless you are absolutely sure of where it is going and to whom it is going.

3. If you are posting a place for rent, regularly check the site you post to and keep an eye out for suspiciously similar listings.

4. If you receive an email asking you to use eRentalApplications.com, blow it a raspberry, wipe off your screen, sanitize your keyboard and delete it from your email.

Categories: property management · seattle
Tagged: ,

Renters vs. Managers: Throwdown #1

June 5, 2009 · Leave a Comment

Dear Tenant,

We know it’s been a rough few months. We know that job markets are uncertain, the stock market is teetering and life is pretty stressful. To help out, here’s your lease renewal along with an increase in your rent…wait, what!?

Yep, it’s true, some property managers are raising rents, here in the Puget Sound at least. With the economic belt-tightening nationwide, I would think that landlords would try to stay away from raising the rents of current tenants, but that just goes to show that property management is a complicated business. While winter is historically a slow time for rentals, now that the weather and the market are perking up slightly, some landlords aren’t wasting the opportunity.

Perhaps I don’t have all the facts; despite the slumped market and influx of rentals versus home sales, are costs for landlords continuing to increase? I know property managers are feeling the crunch of the economic downturn just as much as renters, and I am aware that regardless of how laid back or accommodating a landlord may be, at some time or other, the rent will have to be increased, but is now the best time to do it?

When the market is flooded with move-in specials, reduced rental rates and incentives like amenities, updates and more rooms for less money, why (aside from hassle) would a renter stay in an apartment where the rent is going up when everything around him seems to be going down?

Local property managers, help! Is this just the way of the world, a savvy market plan, or a poor business move by unknowing property managers?

Categories: property management · seattle
Tagged: ,

Fame or Infamy: Does it matter?

June 2, 2009 · Leave a Comment

Student housing has been around since young cavemen pulled their sleeping furs around the elder caveman’s fire for a nap between lessons in Mastodon clubbing and unibrow grooming, but it’s only in (subjectively) recent years that websites specifically dedicated to rating landlords and property managers have started to take hold.

Notably, near the University of Wisconsin-Madison, prior to his term ending, former Common Council member Ald. Eli Judge organized plans for a “Rate My Landlord” website (see under Solutions for Landlord Accountability) that, at last report, is due out this August. The site is proposed to be a constructive and professional arena for renters to air their complaints, and landlords or property managers to have the chance to respond or defend themselves. The article explains Judge’s goal for the website,” is two-fold: rewarding responsible landlords and protecting tenants from bad apples.”

While Landlord rating systems are nothing new ( in fact, some national sites have been around since 2003) and forums bashing evil landlords and equally snotty-nosed tenants have no doubt been around since the internet’s inception, it does not mean that their implementation lacks the potential to be effective.

Here is a short list of sites that Google spits out in the top ten search results for me:

landorslum.com

pickalandlord.com

ratemystudentrental.com

ratemylandlord.com

While many seem to be based for students and student housing, sites like landorslum.com are national and apply to anyone who has rented room to tenant.

So, what does this mean for landlords and property managers?  More and more sites are popping up online for landlords to be starred and smileyed or tarred and feathered and while there has yet to be a site so definitive as to create blood feuds between management companies over reaching Numero Uno as a top ranked manager, landlord or company, is this the way we’re headed? How much of the content of these sites is valid, and how much is just angry ranting from wounded tenants?

The sixty four thousand dollar question is: Does anyone read these reviews anyway?

Categories: Madison · property management
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