Be A Better Landlord

Rental properties are one of the best ways to earn passive income and build wealth, but “passive” is a little misleading—it can still be a substantial amount of work. However, with a little planning and dedication, you can run your properties efficiently while also keeping your tenants happy.

Treat it like a business
Successful businesses have plans and procedures that keep things running smoothly, and the same should be true for renting and managing your properties. That means committing to customer service, outsourcing work appropriately, and paying close attention to income and expenses. Don’t just assume that you’ll collect a check each month and everything else will be a breeze.

Thoroughly vet your tenants
Collecting applications, interviewing tenants, and checking references means a lot of legwork up front, but it’s worth it in the long run. Choosing the right tenant could mean going years without incident—no late payments, no legal issues, and no property damage. Choosing the wrong tenant could mean monthly calls and visits to collect late rent, expensive property damage and repairs, eviction processes, court dates, and a whole lot of stress.

Make sure your lease is rock solid
Lease agreement laws vary from state to state, so don’t cut corners—find a lawyer who specializes in lease agreements. You’ll be glad you were thorough if you ever have legal issues with a tenant.

FHA Limits for Los Angeles Area

Homeownership is not out of reach. FHA limits in California are one of the highest in the country.  I have great lenders that can help you reach your real estate goals! Call me to get started on your homeownership goals!!!  Laura Key 310.866.8422

Here are the current limits for Los Angeles (as of August 23, 2013) FHA allows 3.5% downpayment over a 15 to 30 year term!

Single Family             $729,750

Duplex                        $934,200

Tri-Plex                      $1,129,250

Four-Plex                   $1,403,400

Source: FHA.com

Higher Home Prices Cool Buying Frenzy

Is all this frenzy creating a mini-housing bubble? What are your thoughts on this housing market?  Laura Key 310.866.8422

The recent rise in home prices has more investors concerned that it will be increasingly difficult to turn a profit from their rental investments. Nearly half of U.S. real estate investors say they expect to purchase fewer rental homes in the next year, according to a recent survey conducted by polling firm ORC International.

Just 10 months ago, the percentage of investors who said they intend to buy fewer homes stood at 30 percent—compared to 48 percent today. Only about 20 percent of the investors surveyed say they plan to buy more homes in the next year—a drop from the 39 percent who reported they intend to buy more homes last August.

More than half of the investors surveyed who own rental properties say they plan to hold them for at least five years or more, and 33 percent plan to hold them for 10 years or more. 

“Higher prices are reducing returns on investment and investors are responding by cutting back on their purchasing plans until conditions sort out,” says Chris Clothier, a partner in MemphisInvest.com and Premier Property Management Group. “Fewer foreclosures, rising property values, and competition from hedge funds are making it tough to find good ideals on distressed sales. On the other hand, investors are planning to hold onto their rental properties for at least eight to 10 years and realize the benefits of rising rents and low vacancy rates. Cash flow is much more important than appreciation.”

Source: ORC International

Laura Key, CBS News, Buyer's Agent, Selling Agent, 

Thinking of Selling? I have buyers who are pre-approved and ready!  They are looking in several areas of Los Angeles county!

5 Things You Should Know Before You Flip A Property

Money is made at the buy, not the sell of your flip. When flipping a house your money is made at the purchase not at the sell of the house. So, many times people buy a house with the intentions of making a huge profit only to find out that they could not make any money after all the renovations because the purchased price of the house was to high.

1. Money is made at the buy, not the sell of your flip. When flipping a house your money is made at the purchase not at the sell of the house. So, many times people buy a house with the intentions of making a huge profit only to find out that they could not make any money after all the renovations because the purchased price of the house was to high. When you purchase your property you need to be sure that you buy the house with enough money to make renovations, have carrying cost, and add about 5 $6,000. Now, cost is at $147,000, and that is if everything goes as planned. Profit is under 10,000 dollars. The mistake was made at the purchase at the home, not the sell.

2. Get an inspection on the home - Get a complete inspection done on your property. By, spending a few hundred dollars on this expense you can save thousands in problems that you cannot see. Foundation, Pest, Wood Rot, Etc... By, getting a full inspection you can rest assured that you know every thing that is wrong with the property before its to late. In the contact for the house you need to make sure that you have 7 days to have a inspection preformed, and if the inspection finds problems that are going to cost more money that you are willing to spend you can get out of the contract with no penalties.

3. Don't do the work yourself: - Get a contractor or several sub-contractors and have the work done quickly. You need to have you house flipped ASAP, so that you can get it on the market and get it sold. When I started flipping my brother and me did a house together, and we did all the construction. I had a construction background and figured it would save thousands, but it took us over 4 months to get the work done that a contractor could have had the work done in a month. But, we trying to save money on our flip did all the work on our time off and after work, and it just took to long. On our 2'nd flip we used contractors for almost everything and had the house completely flipped with a new roof, new air conditioning, new hardwood, and much more in only 3 weeks. We did not have to spend all our time working on the property and were able to spend that time looking for the next deal. This is how you get rich in real estate.

4. Place the property 1 to 2 percent below market value: If you are wanting to flip real estate and make money the object is to buy and sell the property as quickly as possible, so that you can move on to the next house. If you purchase a house and try to sell it at top dollar to make and extra couple of thousand dollars on your flip, and end up holding it for 6 months you are loosing money. Get the house on the market at a price that is going to blow the competition away, and you will sell it no matter what the market conditions. On our second house the market for selling house went down do to the housing market as a whole, and the tightening of the loans across America. We were told that you could not sell a property in this market, but we went ahead anyway and flipped our house. After 3 weeks on the market we had 3 people wanting to buy the house. Why, because we offered it at such a great deal that people wanted to jump on it. That is what you have to do especially if the market is slow.

5. Use a real estate agent - Do not try to sell you house on your own. Harness the power of a real estate agent and the power of the MLS system. When you do a FSBO you are depending on people driving by your house and seeing you sign, with a real estate agent you have someone actively marketing you house to get it sold. Once again this will free up more time for you to look for more great deals. If you want to help the process I have found that craigslist and listing you house in google adwords help to, but use these tools with the help of a agent such as Laura Key to make sure I have all my bases covered.

I hope this article has been helpful with the basics needs of flipping a house. If you will study and learn you will make money. But, do your homework before you purchase a house, and make sure that you can pull a profit on your deal. Then, make it happen! I am a Investor Friendly Agent, let's get you some deals! Laura Key 310.866.8422

 Laura Key on CBS News

Other Side of the Coin Pt. 3...Realty Goddess Turns Landlord

Renting our home has become quiet an adventure!  I scheduled three showings on one day.  I try to keep the showings to a certain window time just to keep the madness down a bit.

There are PRO's and CON's of living in our house while it is being advertised for rent.  Pro's...I am here most the time so if I put an Open House sign outside people can just come on in.  Con's...I had to put a sign on my door that says "do not disturb the occupants" for the times we will not be showing. Someone actually rang our bell at 8:45pm one evening asking to see the house!  People are amazing!

What I am slowly realizing is this...I am having a hard time taking myself out of ownership.  I notice when I show our HOME I have a story to tell about our house.  I know our neighbors, I love this neighborhood and this little red brick house is a place full of memories.  Brick, mortar, nails and wood are what constitutes a physical house, but what YOU put in it  makes it a home!  This is what is making it so hard for me.  Renters come in, they walk through, they have their comments (all good so far) they open closets and cabinets and it feels...well, it feels...SO BUSINESS.  Stiff and stale.  I can't wrap my head around that.  Even though this will not be owned by our renters, I want to know they will have wonderful memories of the time they spend here.  I want them to care and love our home and treat it with the respect it deserves.  Gosh, I am such a hopeless romantic even with houses!

When I have buyers, that is what I picture for them.  Memories, love and laughter, a place where you come and lay your burdens down.  A place to cherish and relax.  Is it so wrong to want that for my renters as well?

It all boils down to this...it does not matter if you own or rent...EVERYONE DESERVES A WONDERFUL PLACE TO CALL HOME!

Our home has not found its perfect fit yet, but I know it's calling out to the right ones.  Showing our home has made me cherish my memories even more.  Every Christmas we had major family dinners, sang around the piano, decorated our home, baked cookies for our neighbors and loved ones.  We were the home to "BE" for the holidays!  We raised our child here, had BBQ's, supported our neighborhood.  We laughed, cried, sang and danced here.  So I am taking this time to reflect on these things and I am letting the blessings wash over me daily.  It is my hope that the next occupants have the same wonderful feelings we had over our nine years here.

Now if we could just decide on a property manager....UGH!

For now, we keep showing and interviewing....tune in next time for the next exciting episode of Realty Goddess Goes Landlord.

Blessings, peace and love from the Realty Goddess!

Follow me through this blog, twitter, facebook, google+ and foursquare. We will share laughs and love along the way!  

Other Side of the Coin Pt. 2....Realty Goddess Turns Landlord

Alright, I must admit, the shaking and sweating has not really stopped since my last post.  Now that I am on the other side of the coin, I can REALLY put myself in my client's shoes.

Let me tell you where we are.  I have made a virtual tour of my home. Wanna see it? http://www.zingding.com/856585 There you go!  Ok, so I am advertising and showing my precious little home.  Being in the business, I know how important it is to have a good property manager.  Little did I know just how hard that would be.  We have interviewed four and three out of the four actually followed up with us.  Every property manager sees things differently and only two of the four belong to NARPM. That's the National Association of Residental Property Managers. http://www.narpm.org/

When working with Property Managers, it's important to know they will be working for YOU.  So ask for a copy of their property management agreement before signing anything.  Ask questions, do your research, do NOT just pick the first one you find.  Do they run credit checks, what are the up-front charges, do they handle payments electroncially, can they handle evictions if things go wrong, will they help in finding good repair people for issues and if so is there a cap on getting those done with your approval...(whew, see what I mean?)

You will need to make sure all possible tenants are screened appropriately.  It's important you know the rental history and credit history of the person living in your home!  I get conflicting info on this but I feel it's important to do a background check as well, but that's the HOMEOWNER SIDE OF ME! 

Will you take pets? If so, will there be limits to what kind, size, how many? Will you require a full months deposit? Will the tenants be responsible for utilities? These are just a few of the questions you will have to answer if your decide to rent your property out.  Be prepared!

Alright, so we are showing our home now.  I have had about 500 hits on my virtual tour.  (yes rental vacancy rate in Denver is about 1.4%; VERY LOW) I have now shown my home to about 15 people but I have no applications as of yet. That's ok, it's only been advertised a few days.  In my case, I am the one showing my home.  That has been an interesting adventure.  Tenants want to tell your their background and negotiate immediately but I have to step back, take a deep breath and say, you will have to fill out an application, write a letter if you want to explain anything that might pop up and do the proper procedures for an application.  I show leasing property all the time but now I have to remember that the same procedures apply even though this is MY home.  I am still Laura  Key, REALTOR®, (that's Realty Goddess to the world) and that means I have ethics and housing laws to uphold.  I stand by my profession and I will uphold all my duties. I LOVE my job and I want to keep it, nothing unethical is worth risking my license.

So bring it on....it's a new journey and a new adventure. I shall keep you updated as we go along.

To be continued.....

Follow me on this blog, twitter, facebook, google+ and foursquare.  Maybe I will make you smile a little during your day, maybe I have some education for you or maybe I can just allow you to take a little breather from your hectic day!  Love, blessings and peace from the Realty Goddess!

The Other Side of the Coin...Realty Goddess Goes Landlord

I have been in Real Estate for five years now. It's had it's up's and it's down's but I really can't see myself doing anything else (besides singing of course) I love people! I love helping others start new chapters in their lives. My clients become my "friends" and I have experienced wonderful things in this career. I've seen babies born, marriages, retirements, and everything in between that cause changes in other's lives. I pride myself on repeat business and referrals! I have counciled people on the hardships of facing foreclosure, living through a short-sale and relocations. 

One thing I have just “dabbled” in is rentals.

Enter the “Jaws” theme song……

When I joined my current company, Cliffdwellers Real Estate (www.Cliffdwellers.net) I came in with a STRONG wind!  I think I might have frightened my managing broker, Tony Cline.  I am pretty wild in spirit!  Cliffdwellers also does property management for the Denver Downtown area and manages over 200 properties.  With that being said, one thing I was not too excited about was doing leasing.  I never really wanted to try it, I only wanted to be a listing and buyer’s agent. 

In the last year, I started doing leasing reluctenly.  For some reason “renters” and I just did not have the “relationship” that a buyer or a seller and I experienced. I'd make appointments, confirm them and find myself standing outside for 30 minutes waiting for people who just did not show up! Ah, yes, leasing is a different type of beast in real estate. 

However with the housing market being what it is right now, there are more renters than buyers.  Long story short….I jumped in the renters pool - both feet first.  Slowly I got my groove, I had a plan and before you know it I was helping renters find a cool place to live and opening new doors in my business. I am proud to say I have opened another door to my future and have also created more friends in this new avenue.  Why are some things so scary at first, then you conquer them and look back and say….Oh, what was I so afraid of?

Enter a NEW ROAD!  (Now you must sing “follow the yellow brick road” in your head) Can you see that music is the soundtrack of my life?  But I digress….

As everyone knows now, we are moving to Los Angeles in just a few short weeks.  We currently own our little red brick home.  We have made memories here, we have touched every single room and made it ours.  We take pride in our house and LOVE our neighbors. So, what to do, what to do????

It would not be wise to sell our home in this market, so now the Realtor becomes the Landlord!  Time to rent!  Now my knees are shaking, I’m wiping sweat from my brow and I am a bit sick to my stomach.  It’s so easy to guide others in my business.  I’ve worked with investors many times over.  Fix and Flip (no problem) Fix and Rent (no problem) BUT MY HOME….PROBLEM!

(To be continued….Tune in next time for the adventures of the Realty Goddess turns Landlord)

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