Auburn Property Management Guidelines for Purchasing An Investment Rental Property

Purchasing a rental property is a big decision and one that requires a lot of research and planning. Buying an investment property poses many options and each property type has a benefit depending on the buyer’s goal. Auburn property management team, RPM Select, manages multiple types of properties, all with a variety of returns. Each property has a specific goal, targeted clientele, advantages, and disadvantages. Let us help you learn how to purchase your first investment property and educate you on the best selling points for renters so you can get the maximum return on your investment. 

Financials of Purchasing an Investment Property

Planning ahead of time to purchase an investment property is a must. It requires a large amount of capital to put a down payment on a secondary or rental property. Unlike purchasing an owner occupied house, which requires a minimum of three percent down, a rental property down payment is a minimum of twenty percent. This is due to the fact that mortgage insurance is not allowed on a rental property. If you are purchasing a house in Auburn for the median home selling price of $475,000 according to Realtor, the minimum required down payment would be $95,000. Most people do not have $95,000 lying around. They get it through saving and investing. Auburn property management teams suggest investors plan ahead and know the price range of what they can afford when buying a rental property. In addition to the down payment, investors must consider the cost to finance an investment property. Interest rates are higher on rental properties compared to primary residences. A high interest rate could eat away at profit. This is where an all-cash offer can come in handy. It is make or break that investors and their real estate agents accurately calculate the margins.

Rental Property Margins

  • Determine a Rental Price: Conduct a market research analysis to determine an accurate rental rate. Look at similar properties that are currently listed for rent within a 5 mile radius to see the competition. Similar properties would be ones with the same number of bedrooms and bathrooms, square footage within a 500 range, comparable upgrades and amenities, and lot size. Price your property high, but competitively
  • Maintenance Costs: A good rule of thumb that Auburn property management professionals recommend is for investment property owners to set aside one percent of the value of the property to account for maintenance each year. Keep in mind that new properties will likely have lower maintenance costs while older properties will have higher maintenance costs. There will be some months where no maintenance will be needed, while others may require a larger amount to cover repairs needed.
  • Other Costs: Investors must factor in the cost for homeowner’s insurance, property taxes, homeowner’s association fees, and additional property fees like landscaping, snow removal, or pest control. Rental properties do not stay rented 100 percent of the time. It is wise to consider the vacancy rate of the area that you are looking to purchase a rental property. Best Places states that Auburn, CA, has a vacancy rate of only 2.1 percent.  

Be realistic with financial estimates when purchasing a rental property. Error on the side of being conservative in your numbers. Doing so will increase your chances of buying a profitable investment.

Purchasing the Right Rental Property

Buying the right property for the right investors is crucial in Auburn property management. Single family rental homes generally attract long term tenants, but they also cost a lot more than a condo. A condo provides a more affordable investment, but with the condo may come more transient tenants and an association fees. For the sake of long term tenancy, choose a single family home for a rental. Families with children who are enrolled in the school systems are likely to put down roots and stay for a few years in the rental property. When they are ready to vacate, they will likely do so during summer, when the rental rates are higher than winter and there is a vast number of renters seeking new homes. Look for a rental property that has at least three bedrooms and two bathrooms, provides an open and functional floor plan, a garage, and a yard. Purchase a rental home in a neighborhood that has high ranking schools, close proximity to shopping and dining, quick and easy freeway access, and parks. Prior to determining a property, research neighborhoods that allow rental properties. Homeowners associations often have restrictions or do not allow for rentals. 

How Auburn Property Management Pros Can Help You

Owning a rental property is a 24-hour job that does not sleep. Whether it is a maintenance emergency or the property is in the leasing phase, property management can often leave owners feeling a heavy burden and sense of overwhelment. RPM Select  is here to lift that weight. Our professional leasing team can offer investment property owners preferred member pricing on maintenance, affordable management fees that practically pay for themselves through our faster leasing times, achieve maximum rent prices, and provides affordable and preventable maintenance. Stop feeling overwhelmed with your rental property and call us today

How Folsom Property Management Companies Deal with Untidy Tenants

Choosing to turn a once owner occupied home into a rental house can be difficult for many homeowners. Homeowners who have put days or months of sweat equity into their homes, meticulously cared for every square foot by regular cleanings, and keeping up with repairs can all feel like it is getting tossed out the window by transferring their home over to a renter. But the truth about rental properties is that not all renters are messy. In fact, if landlords and Folsom property management teams do their homework, it is likely to have a tenant who cares for your house the way that you did. 

Tenant Screenings and Rental History

It starts at the beginning. Carefully screen prospective tenants. When an applicant turns in an Application to Rent, there should be a section on the form where they must list rental or living history. This gives potential landlords the opportunity to contact previous landlords and inquire as to the type of tenants your applicants were while living in a different house. Landlords should ask questions like the following:

  • How much was the monthly rent?
  • Was rent paid on time each month and in full?
  • Were there any late payments?
  • If so, how many?
  • Was an Unlawful Detainer filed?
  • Was the property kept neat and clean by the tenant?

This information will give potential landlords a good picture of their applicants to let them know if they are responsible tenants. Along with verifying rental history, always check credit report scores, verify employment, and paystubs. Folsom property management team, Real Property Management Select, knows that taking action to find out more about your tenants will help protect you as a landlord. 

Enforce Lease Agreement Rules

All lease agreements should have a clause regarding cleanliness standards. Clearly explain and outline what is expected of the tenants. If landlords fail to have a cleanliness clause in the agreement, then they will not be able to take action to correct an untidy tenant. Cleanliness clauses often consist of items like keeping personal belongings inside the property and out of sight from neighbors, routine vacuuming and dusting, washing dishes daily, wiping down appliances, scrubbing toilets and showers, reporting pests, and much more. Conduct routine property inspections of the inside and outside of the property to see that tenants are following the lease agreement rules. If you find that your tenant is not in compliance with the cleanliness clause or any other part of the lease agreement, landlords should first document and take pictures of noncompliance. Folsom property management teams and private landlords should then alert the tenant of the problem or issue, clearly stating where the lease agreement explains the rules, and ask the tenant to please comply within 48 hours. Go back to the property to re-inspect to see if the tenants are now in compliance. Remember to always post an Entry Notice notifying tenants of the date and time frame that you will be entering the premises. If you find that they fail to adhere to the lease agreement, consult with legal counsel to see if you have a case for eviction. 

Clearly State Move-Out Guidelines

When a tenant turns in a 30 Day Notice to Vacate, leasing professionals should acknowledge a tenant’s intent to vacate by posting a receipt that they received the Notice to Vacate, along with cleaning guidelines, and instructions on how to return the house keys. My Move provides instructions for tenants to write a 30 Day Notice to Vacate to give to a landlord. Folsom property management professionals at RPM Select ask tenants to carefully and thoroughly clean the house or apartment prior to moving out, if tenants want to recoup the security deposit that they originally put down on the property. Cleaning guidelines generally cover the following:

  • Move Out: Remove all belongings from the property. Any items left behind will be discarded at the cost of the tenant.
  • Wipe Down: Clean countertops and wipe out cupboards, refrigerator shelves, and pantry shelves, clearing them of all debris and stains. 
  • Appliances: Clean all appliances, including the oven, stove top, microwave, dishwasher, and refrigerator. Pull appliances out and sweep and clean debris from behind and under them.
  • Replacements: Replace burnt out light bulbs, stove drip pans, and filters on HVAC units and the range hood.
  • Flooring: Scrub all tile, hardwood, or laminate flooring. Professionally clean carpeted areas and give the receipt of cleaning to Folsom property management. Doing so will provide proof of carpet cleaning and it will prevent that amount from being deducted from the security deposit. 
  • Walls: Inspect all walls and baseboards. Patch and paint as needed. Many property management firms allow for normal wear and tear at no cost to the tenant. 
  • Window Coverings: Clean and dust window coverings and blinds. Replace broken or damaged blind slats. 
  • Bathrooms: Scrub toilets, bathroom vanities, showers, and tubs. Remove any residue of film or build up. Wipe out vanity drawers and cupboards.

How Folsom Property Management Team, RPM Select, Can Help You

At RPM Select, our professional leasing team handles tenant screening, routine property inspections, and move outs for you. Let us deal with the hassle of property management while you rake in the returns. Call us today

How to Keep a Rental Property Safe With Elk Grove Property Management

Managing rental properties requires landlords to take on multiple roles. One of these roles include acting as a Safety Officer. Part of Elk Grove property management is providing a safe and secure living space for tenants. Stimmel Law Firm states that this includes all aspects of Habitability Laws, implied habitability laws, and taking measures to deter intruders. Unsafe rental properties are a liability to property owners and can bring about legal troubles if an injury or accident occurs. Follow along below to discover how you can keep your rental property safe and limit your liability.

Safety Checklist for Rental Properties

Real Property Management Select takes every effort to reinforce and inspect rental properties for safety. Twice a year, our Elk Grove property management team conducts routine property inspections. During these inspections, our experts look for safety hazards, repairs, needed maintenance, and general housekeeping. A rental property must provide a safe and secure home for tenants. Property managers can conduct inspections following these items on our checklist.

  • Structural Elements: Inspect the exterior of the property. Look for loose roof shingles, stucco or siding that is cracked or breaking off of the exterior of the house, secure hand railings, deck and patio railings, look for sidewalks with large raises or cracks in the concrete. On the interior of the property, inspect the flooring to make sure there are no tripping hazards, walls should be smooth to the touch without bubbling or cracking paint or mildew growth, toilet seats must be securely fastened, as well as glass shower doors. 
  • Common Areas: Elk Grove property management oversees all types of properties including single family homes, large apartment complexes, duplexes, and condos. Landlords that manage large apartment complexes should check common walkways and common areas to be certain they are clear of debris, trash, and tenant belongings and storage. Single family homes also have common areas that consist of the front and back yard, stairways, and hallways. Inspect these areas and see that residents keep a tidy yard by pruning and trimming overgrown trees and shrubs, mowing the lawn, and double check the handrails to see that they are tightly fastened. 
  • Electric and Gas: Turn on and off systems that use electric and gas. This includes appliances, furnace and air conditioning units, flush toilets, turn on fans and ventilations systems, and test elevators at large apartment complexes. The Elk Grove property management team at SAC-METRO also suggests testing and replacing batteries on smoke and carbon monoxide detectors. Limit your liability as a landlord and inspect these detectors twice a year. 
  • Pests: Look for signs of animals droppings, points of entry in screens and screen vents, look inside kitchen cabinetry and behind kitchen appliances, in the bathrooms, and in the bedrooms for signs of pests including mice, cockroaches, bedbugs, or carpet beetles. These are some of the most common household pests that can cause a big infestation with expensive treatment if not caught early on. Lease agreements should state that residents must report any signs of pests and comply with treatment. 

How to Deter Intruders

There are many ways to keep a property safe from criminal intruders. As a landlord, take the necessary steps below to ensure your tenant’s safety. Elk Grove property management professionals have been trained in the many signs that invite intruders. Keep your property safe by making your property a zero access point for burglars and robbers. 

  • Lights: A well-lit home or apartment complex provides multiple benefits to tenants. It allows them to see clearly at night and avoid trips and falls while on the property. It also deters intruders. Alarm New England Company states that 34 percent of burglars enter through the front door. Turn on the porch light and keep the exterior of the home well-lit during evening hours. It is more difficult for intruders to sneak through a door that has a bright light shining on it, than if they were camouflaged by darkness. 
  • Tree limbs: Cut, prune and trim any tree limbs that would allow a burglar to climb the limb and enter a second story window. Trimmed trees also neglect to provide the coverage that intruders look to hide behind, so they will not be detected by neighbors or people driving by the house. The Elk Grove property management SAC-METRO leasing staff wants to remind landlords that overgrown or unhealthy trees could also cause damage to the premises if they are uncared for and fall onto the house in the event of a storm. 
  • Fences: Secure a padlock on gates to prevent unwanted guests from wandering into your front or backyard. Do not install tall fences or fences that provide full coverage in the front yard. Once again, this provides a nice hiding place for intruders. If you must have a fence in the front yard, choose a short picket fence or one with gaps between the fence slats. 
  • Doors and windows: Test all door and window locks. If a lock does not work, take action immediately and make a repair. Failure to do so could present a liability to a landlord or Elk Grove property management teams. Look around the edges of the doors and see that the door shuts tightly, leaving no gap or draft. Repair weather stripping as needed. 

How Elk Grove Property Management Can Protect Your Home

RPM Select’s professional leasing staff takes pride in the proper care of rental properties. Our thorough and rigorous inspections help to protect client’s homes from maintenance, repairs, and unwanted criminal intruders. Protect your home and call us today.

The Advantages of Owning a Rental Property in Sacramento Property Management

It is no secret that investing in real estate can make you rich. Look at moguls like Carl Berg, Sam Zell, and Stephen Ross, who have net worths pouring over the billion dollar mark. While these investors are few and far between, investing in real estate does have the power to unleash a generous amount of return on investment. The Sacramento Bee News reports that the City of Sacramento ranked sixth place on the top ten list of the largest cities, based on population, in California. Surrounding communities like Roseville, CA, ranked sixth place for the top ten cities under 300,000 with largest numeric change, and Rocklin, CA, ranked fourth place in the top ten fastest growing cities in California. Statistics like the above mentioned suggest that Sacramento property management has the potential to be a goldmine. And it is. 

Why Sacramento

Rent Cafe reports that the average rental price in Sacramento is $1,404 with an average apartment size of 823 square feet. The year over year change is four percent. Sacramento has an increasing amount of renter occupied households. Rent Cafe also reports that 41 percent of the households in Sacramento are renter occupied, while 58 percent are owner occupied. That means that nearly half of all households in Sacramento are renters. This means that finding a qualified renter for your home should be plentiful. The most affordable neighborhoods for renters include Airport, Brentwood, and Carleton, where the average rental price is $906 per month. The most expensive neighborhoods in the Sacramento area are Tahoe Park South, Tallac Village, and West Tahoe Park, where the average rental price is $2,520 per month. This information is important to note because rental prices affect home sale prices. And vice versa. If you have not already purchased a rental property in Sacramento, look into these neighborhoods based upon your spending budget. Sacramento property management company, Real Property Management Select has also noticed that economic recovery has impacted the housing market. Sacramento is one of the last counties in California to reach pre-recession job recovery. However, job growth in Sacramento is expected to meet the increasing population growth in 2019. The FT Journal reports that Sacramento has been increasing in population by one percent each year since 2008. All of these newcomers need a place to lie down each night, and that is where investors make their fortunes. 

Tax Breaks for Rental Property Owners

There are many ways that property investors can put more money back into their pockets by taking advantage of simply tax breaks. Did you know that a real estate investor can write off any interest paid to the mortgage lender on the loan for the rental property? Sacramento property management teams and landlords can also write off interest paid on a credit card that was used for supplies or service on the property. The money spent on repairs, goods, or services, performed on the property are also able to be written off during the same tax year that they were paid. Personal property costing up to $2,000 that was purchased for the property including appliances, furniture, or gardening tools can be written off within one year. Traveling costs including flights and driving miles may be deducted as long as they were intended to inspect and repair the property. Mileage used to upgrade or make improvements cannot be deducted. For a more thorough list on tax deductions that you may qualify for as a Sacramento property management landlord, view Nolo

How to Manage a Rental Property and Stay Out of Legal Trouble

The ins and out of rental property management can make anyone’s head spin at times. It takes education, practice, and experience to feel comfortable managing a rental property. The most important thing that investment property owners can do is to educate themselves on the federal, state, and local housing laws. This is where many landlords can make minor mistakes that can cost them the annual profit margin on their rental property. Fair housing laws, anti-discrimination, and habitability laws, ensure that all prospective applicants and tenants are treated equally and not discriminated against based on age, sex, religion, national origin, familial status, disabilities, and that their living conditions are safe and habitable. In addition to staying updated and educated on housing laws, the Sacramento property management team at RPM Select strives to treat everyone with the Golden Rule in mind. Treat others the way you would want to be treated. 

Why You Need Sacramento Property Management Company, RPM Select 

Taking on the role of a landlord is a 24/7 job. Are you prepared to make yourself available everyday of the week and at every hour of the week? Let the professionals at RPM Select handle the daily stresses of Sacramento property management for you. We provide full leasing and property management services including leasing, advertising, move ins, move outs, lease agreement renewals, maintenance, maintenance emergencies, turnover, showings, and deposits. Contact us today.