All Forum Posts by: Brad Larsen

@Tiffany Moseley @Jonatan Barbera @Kim Meredith Hampton  

KIM - Thanks for the mention.  

Tiffany - We recommend using Jonathan Barbera and Jonn Barr.  He is mentioned here.  We work with them a lot as they help investors find good deals, and then we do the management for their clients.  They know our numbers and can help you plan for your cash flow analysis.

Renewal Fees are a vital part of a Property Management agreement.  If you are a Landlord / Owner - you should WANT a commission based renewal fee.  Meaning, when that tenant decides to renew.....the staff and the company managing the home should be financially rewarded.  

Renewals are a landlord and property manager's best friend.  They are good all around for everyone.  

In our company, we charge a flat fee of $275 for each renewal.  I know, this is low....seriously low.  

When a renewal is completed, the Portfolio Manager (an employee of my company) earns 50% of that renewal fee.  They are highly encouraged with financial incentives to get renewals.  This puts their interests in line with the Landlord / Owner's interests on keeping the home leased.  Often times taking a lot more crap from a tenant than is really necessary.  

Take a look at the alternative.....if there was NO incentive for a property management company to get a renewal because they do not charge a renewal fee.....why are they going to seek one?  

1) They will let the lease slip into a month to month practically forever.

2) There is no incentive to seeking rent-raises unless the staff has financial incentives to do so.

3) The alternative is a vacancy - costing the Landlord / Owner thousands of dollars! 

Example:  We took over a management agreement last year for a Landlord / Owner that was with a local competitor.  That company had let the home slip into an auto-renewal system of the lease without any sort of standardized rent increases.  Five years after the tenant first moved in, the rent on the home should have been $300 more.  This lack of incentive and lack of good business practices by that property management company cost that owner thousands in lost rent.  All could have been prevented with an incentive based compensation model with a renewal commission. 

When looking at a management company's fee structures, be sure to understand that it is a business - not a charity.  Embrace ways to reward their good service to your tenants and you.  If you find the right one to fit your needs, they will prove themselves to be valuable part of your business.

Good luck out there! 

@Derek Worsley  It's typically per unit....to quickly answer your question.  

Good luck out there! 

@Betty Cruz  You may want to modify your post because you are now putting out to the world that you will not rent to anyone with a felony conviction.  This is a violation of the recent shift in the law for disparate impact.  

In the order of tenant approval, income is king, and rental history is queen.  If they make good money, and pay their rent (both the king and queen as mentioned) - they will most likely be good tenants.  If they don't pay their AmEx bill on time, that may not affect you as a landlord at all.  

Probably best for you to re-visit your stance on screening tenants so you are not in violation of any laws of Fair Housing, Disparate Impact, or Discrimination.

Good luck out there! 

How and when do YOU want to be communicated with?  This may be the more important question to bring up with your manager.  Do you need to be informed of every single thing with the property?  Or, do you just want the check .... and call me if there are any real issues?

We have owners under management on both sides of the spectrum.  Some need to be involved in all aspects from tenant selection, to maintenance, to renewals, to move outs.  Others do not want to be contacted, or in some cases, can not be contacted....which is why they hire a property manager.

Have that discussion with your property manager on what YOU want so they know your expectations and your relationship with them will be much better off.

Good luck out there! 

2nd that vote for Excalibur.  He was not an Infantryman....but did the next best thing and put them into the fight! 

@Dorothy Butala @Patrick Philip   Hello Patrick - Get your track shoes on because the advice Dorothy is offering is going to cause you to  run away from every management company in the nation that could even contemplate handling your homes.  "Worked at" is a past tense....and some of her advice does not fit Single Family Homes. 

If you ran away from a large to medium sized management company that did not have 40% of their staff owning rental properties, that would be ALL of the management companies in the country.  Completely bad advice - you should run away from that.  

1. Vacancy Rate - In managing single family homes, the scope of what you manage and who you manage for is too different to even consider using this as a metric.  Keep in mind, WE (the management company) does not set the rental rate.....it's the owner's final decision.  If you, the owner, dictate price with no bending - it will kill a vacancy rate - if you were to even attempt to use it as a metric.  PLUS - you have different homes all over town in all price ranges.  This is not a figure that means anything in the single family home space.  

Perhaps a better metric would be Average Days on Market giving you a number of days - not a percentage.   

2. Eviction Percentage?  First - define eviction?  Sending a notice to vacate?  Attending an eviction hearing?  Filing a writ of possession?  Conducting a sidewalk move out with the Sheriff?   PLUS - it has nothing to do with proper screening - IF - you manage low end homes.   This is another metric that means little if anything based on multi-family numbers, not single family property management.  

A better question to ask would be how many writ of possessions do you have to enforce a month / year?  

Here is another article on choosing a property management company:

https://www.biggerpockets.com/forums/52/topics/385...

Also - great advice by @Kim Meredith Hampton.

Good luck out there! 

@Audrey H.  Would love to hear more on this subject as we see the merit of AirBnB management trending into traditional property management.  The numbers do not make sense until you get to a high scale, but what turns an owner into an AirBnB option is often times their situation.  1) They may not want to fully move furniture, etc.... or are coming back periodically  2) They are trying to sell the home while they are attempting to generate some income  (High End Listing).  

I will be following this thread to see what others have to say! 

@Eric Sammons  We would recommend Mark Thompson.  www.EquityTeam.com.

@Nicole W.  First thing to do - Join NARPM.  From there, start your own company and focus on Property Management.  Winter is coming for Realtors making a living on Sales alone.