All Forum Posts by: Michael Tempel

RUBS.    

Shane.  I am active with MHA and have a property in NE.  Www.thebottineau.com.    Always looking for connections in the business.  

Feel free to reach out.   

I am trying to connect with other users from Minnesota that use Appfolio for their properties. I am open to any size user and trying to create a local group to help figure out solutions or best practices using Appfolio in Minnesota (or in general). One example is CRPS. There isn't a good report and I am literally hitting my head against the wall trying to figure out which reports will supply the correct information. An automated option would be amazing! Please connect with me if you are interested in joining this group by messaging me.

Originally posted by @Dooreuhn Cee:

@Michael Tempel by syncing I am not referring reconciliation which AF does for a fee for each account.  i am looking to replicate QB functionality of taking a downloaded bank transaction for rental income or repair expenses, and categorizing the transaction to a particular tenant/vendor and a particular property similar to the Class function of QB. the rep showed me the accounting module and acknowledged lacking this feature during the demo last week.

Gotcha, that makes more sense!   I like to manually do bank recs etc. even though it is more work, but that does sound like a nice feature you mentioned above.

 Also, I agree with the last post about the free versions.  I was actually really happy with Buildium when I had a bunch of singlefamily (15 or so).  Similar to Appfolio, but the price is much lower and will get what is needed done for you.

I have used all of the above, Yardi for many years, but switched to Appfolio last year.  We have over 300.00 units, so the pricing is just 1.00 per unit (there is a 200.00 min price though).   They do auto sync bank recs as of last month.

For the price it has been may favorite so far and works with single family, multi-family and commercial.  Also, all ACH payments are 100% free for the resident and management company, this has saved us quite a bit since you typically have about 80% of residents paying this way.  Our old system was .95 per transaction and often we process 600 plus payments a month so you can see how this adds up.

I 100% agree with Ben on the range for PM companies.  Our payroll expenses are lower on average...usually in the 750.00 to 800.00 range, this varies based on economies of scale however.  We use roving maintenance and managers that handle up to 3 sites (usually around 125 or more units each).   This greatly reduces this expense by not having a manager per building when possible.

One of my biggest hurdles is explaining to owners new to the process that the management fee doesn't include payroll or property operating expenses.  To be honest, if it did we would likely lose money or at the very least wasting our time.  A good PM should be able to do it all and maximize your income while lowering expenses.    

Feel free to use me as a resource since we are in totally different markets (focused in MN).  I would like to see what is out there, but also am willing to give my two cents on what you run across if it is helpful.  You can see our services at www.NexusApartmentLiving.com under management.   We are going to create a standalone site with more detail, but this should give you an idea of what a PM company can offer as a comparison.

I think your gut is correct, their usually is a shortage of low income housing.    You will likely have more management challenges depending on the residents background in the programs.     Run criminal background checks if possible if not already provided from the seller.   Income is one thing, but crime is something you should never overlook.   

Welcome. I work in the Twin Cities as well in Multifamily.

This is pretty much the only way I have had good luck buying properties at a discount.  Once a broker, commission and of course public competition is involved the price almost always gets pushed up immediately (low hanging fruit).   We will buy from a broker of course, but usually end up paying more unless it is a discount broker with a set 10,000 fee for example.   The only exception is when we jump in quickly with a solid offer and PA agreement before the market has a chance to respond....most sellers know this and let the market respond though.  

I network with brokers quite a bit and make it clear we are really looking at pre-market deals mainly.  You will be surprised at the list that comes up, of course being able to perform is key to gain access.

We use Costar to look at existing properties that are not on the market (you can view any commercial property).  It is expensive, but you can pretty much decide if you want to buy a property before even making a call to the owner.   I haven't done a lot of this, but blind offers are an option....it is hard to ignore a piece of paper that has an actual offer on it for your property....takes more time to put together, but probably will increase percentages of responses (hopefully not negative) significantly.

We also use a few brokers to make calls to owners for me and pass call on to me when it makes sense for a set fee.   This is a great way to cover a lot of ground and avoid having to make all the calls yourself.  A lot of times I will identify a list and then have them make contact.  I am a broker myself, so I have debated on putting a team of RE agents together, but like not having that liability by using other brokers instead.

I think the shortest form of contact is best (in person is more effective than calling...calling is more effective than a personalized mailer......personalized mailer is more effective than a general postcard).   I get mailers all the time for 103 or interested buyers etc.  Most of the time I toss them, but if they are good I create a template to modify and use myself, but honestly have stayed away from mailers at this time, so I can't say anything either way on their effectiveness.  I might have to give it a shot :-).

There are some other techniques...that probably are not as common lately such as software that shows properties that are behind on taxes or mortgage payments, those are usually good owners to contact if possible, this is my plan when the market slows down again.

I am surprised no one mentioned banking relationships, I was working with a group that bought 700 units this way.   Banks see the whole deal and when it is suffering will often offer it to the best party to manage during receivership and often sell at a discount to move things along.   I always know it is a good call when a bank reaches out to us on a property that has run into issues.

Overall the best strategy is to network like crazy, show a great track record and keep looking even when it looks hopeless (you should see what people are paying in our market right now....it feels hopeless....but I am going to take my own advice).

I agree on all fronts.  But other than metering units and simply not buying them, what has worked when you take this out of the equation?   There is always a solution to improve overall efficiency.  

My issue in our market is if no other C property owners are charging for these utilities ( I compete with about 2500 plus units in my own backyard managed by large nationally based companies, we are not in a position to do this without creating a strong marketing disadvantage not to mention the cost to actually set up meters, very cost prohibitive. 

What I find funny is you are seeing prices so out of line regardless of metered or not in our market.   I will buy a building at 45,000 a unit, while and outside investor is happy to pay 75,000 for the same asset as is. 

So again, my challenge and question is what technology or changes have you made to reduce utility expenses regardless of who is paying for it and not factoring in human behavior?  

Really looking for advances in technology, plumbing, electrical and heating overall.   Another huge factor not mentioned is how we are billed by our utility companies, I have found many errors and overall issues in this area as well.  Have you hired consultants to look into billing and non-owned meters etc.?   

Basically if you had a pipe with water, gas and or electrical running through it, how do you best reduce cost while providing similar output?