MULTIFAMILY Vol 2 Issue 1
January - February 2017
MAGAZINE
What's inside: Landlords, Property Managers Bullied and Harassed Over Rent Increases 6 Key Insights to Milennial Apartment Renters Is The Horizontal Apartment the Future of Rental Housing? How Much Do Property Managers Charge and How?
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Rental Housing Journal − Multifamily Magazine
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Table of Contents O
Welcome to RHJ Multifamily magazine.
ver the last year Rental Housing Journal has seen an enormous amount of growth in reach. We have expanded beyond our regional journals for property managers and apartment owners with our publishing partnership with National Real Estate Investors Association and the launch of the quarterly national publication, Real Estate Journal, and annual Real Estate: Opportunities in Investing (ROI) publications. Additionally, we’ve added featured departments online: RHJinvestor.com and RHJblog.com.
RHJ Multifamily is a bi-monthly digital publication specifically for apartment owners and property managers nationwide. The editorial content will include market trends, best practices, legal commentary and other pertinent information from many of the most successful and knowledgeable sources in the multifamily industry. Thank you for reading and, again welcome to RHJ Multifamily magazine. Will Johnson Publisher
Featured Articles
4. Landlord, Property Managers Bullied and Harassed Over
Rent Increases
11. 6 Key Insights to Millennial Apartment Renters 14. Is The Horizontal Apartment the Future of Rental Housing? 20. What is the No.1 Challenged Faced by Property Managers? 23. How Much Do Property Managers Charge and How? 26. 3 Smart-Home Technology Ideas That
Add Value to Your Rental Unit
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Landlord, Property Managers Bullied and Harassed Over Rent Increases
Tensions are rising between landlords and property managers, and tenant activists. Landlords and managers have been bullied over rent increases. And they face unpleasant demonstrations from activists as Portland struggles with a shortage of housing and rapidly rising rents. By John Triplett, Rental Housing Journal
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not feel their side of the story has The story of one small been told, and that more attention has been focused on what the landlord activists’ demonstrations, and McIsaac said he is speaking out what the tenants say. because many in the landlord and property management industry do “I represent the landlords and not feel their side of the story has property managers who do not been told, and that more attention want to have exorbitantly high has been focused on what the rents, we want more housing activists’ demonstrations, and He said demonstrators have stock,” McIsaac said. what the tenants say. picketed his personal residence. The have placed notices on the “In Portland, 85 percent of the doors of neighbors, camped landlords are small operators. They “I represent the landlords and overnight on his lawn, defecated might have their retirement tied up property managers who do not on his lawn and marched into in these properties, but they don’t want to have exorbitantly high his property managers’ offices make a ton of money off of them. rents, we want more housing scaring the staff, according to his So the stereotype is that all of the stock,” McIsaac said. spokesman, John McIsaac.
Portland landlord says he and his property managers have been bullied and intimidated over rent increases after he purchased a small apartment building and had to raise existing rents to afford his new mortgage payments.
The landlord, Landon Marsh, raised rents “only to the lower end of current market rates in Portland,” said McIsaac in a recent interview. Marsh has also written an op-ed style editorial here detailing his opinions on what happened. McIsaac said the rent increases came after Marsh purchased the small apartment complex, did substantial work to improve the condition of the building and raised rents to cover his costs and mortgage. Unfortunately the rent for one tenant went up by 40 percent and the tenant complained to the Portland Tenants United group.
Photo ©Multifamily NW
property owners are huge, out-ofstate multimillion-dollar concerns. Telling the landlords’ That is not the case. A lot of these side of the story property owners have day jobs,” McIsaac said he is speaking out McIsaac said. because many in the landlord and property management industry do
“In Portland, 85 percent of the landlords are small operators. They might have their retirement tied up in these properties, but they don’t make a ton of money off of them. So the stereotype is that all of the continued on page 6
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Landlords, Property Managers Bullied
property owners are huge, out-ofstate multimillion-dollar concerns. That is not the case. A lot of these property owners have day jobs,” McIsaac said.
Where this all started with apartment building purchase
market rates. So he’s not a profiteer by any stretch of the imagination,” McIsaac said. He said in his opinion, “This guy is a liberal, progressive classic Portlander. He is “He bought one building around a caring, altruistic, sensitive man.” seven or eight months ago out The story of one small in a semi-blighted part of East Portland, a working-class area,” Group pushing rent landlord McIsaac said that with the hysteria McIsaac said. “It was built about control and end to noover rent increases, “the activist seven years ago. And it needed cause evictions for group has targeted a couple of some repairs just from wear and
Portland
Portland Tenants United is a growing tenants union dedicated to organizing tenants to take action to strengthen and enforce tenants’ rights and protections, according to their Facebook page.
Photo ©Multifamily NW
At a recent press conference, Portland Tenants United and City Commissioner-elect Chloe Eudaly, promoting something called “Keep Portland Housed,” called for a freeze on rent and an end to no-cause evictions in Portland until there is a policy in place to improve conditions for renters.
landlords in particular. They are not going after the big guys who tear. The tenants asked him to own thousands of units. They are make these repairs and he said, Leader says group going after the little guys who own ‘Yes I will do that.’ “ wants municipal like 20 units. “So he set to making the repairs. disobedience and rent “And this one guy, Landon Marsh, But he had bought the building at control who is my client, is in the hospital market value. And market value “We’ve been in an officially declared interior-design business. He is a right now is a hell of a lot higher housing emergency for over a year. one-man consulting business. He than it was seven years ago – it’s a Despite that, tenant protections does not do property development lot higher. – the most critical component to for a living. He has investment “He said that he was going to preventing homelessness – have properties. They are small ones. All have to raise the rent. But he said not meaningfully improved, and three buildings he owns combined he would keep the rents – and he conditions continue to worsen,” make up 20 units.” stuck to this – at the very low end of Eudaly said in a press release. continued on page 7
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Landlords, Property Managers Bullied
“My election, and the passage of Portland’s housing bond, present a clear and obvious mandate to City Council to act.”
an awards ceremony. Multifamily NW, an association promoting quality rental housing, was holding its annual ACE awards ceremony for its members when Eudaly admits state laws prohibit protestors from Portland Tenants local rent control measures. But United showed up. she wants city commissioners to commit “municipal disobedience,” Dozens of protesters gathered do it anyway and fight the across the street from the museum. resulting lawsuits, she told the It didn’t take long for tempers to Portland Tribune. flare, according to koin.com.
Deborah Imse, executive director of Multifamily NW, said in response to the protest, “Over the past few years, rents in Oregon have risen while incomes have lagged behind, creating an urgent housing crisis. In order to thrive, the region needs to work together to create more quality housing options for families of all incomes.
“With demand for housing continuing to increase, we must Portland Tenants United is focused The television station reported that, take action to reduce rental on lowering the eviction rates in “Tensions were high. Some choice costs by increasing the variety Portland by organizing tenants to words were exchanged as well as of housing types available to people of all incomes and creating more subsidized affordable and market-rate units,” Imse said in the statement.
Tenant activists demonstrate outside Portland Art Museum photo ©Multifamily NW
vocalize their concerns. Gabriel Erbs, organizer for the group, insists the fight is far from over, according to a report on Portland Patch. "Tenants can be evicted, for whatever reason or no reason at all, at the landlord’s whim," he said.
some apparent shoving as protesters came face to face with ceremony attendees. Shouts calling the multifamily association attendees ‘parasite’ and ‘bloodsucker’ rang out from protesters.”
Protesters push past security guards photo ©Multifamily NW
Property management groups say more apartment units needed
A small group of protesters stormed past security into the Landlord and tenant Any solutions to the Portland museum to disrupt the event. They issue, property activists have clashed were soon removed by security, housing management organizations say, Tensions escalated late in 2016 at according to katu.com. the Portland Art Museum during continued on page 9
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Landlords, Property Managers Bullied
should be market-based. A spring 2016 apartment report released by Multifamily NW says that “Portland’s current development pipeline includes an impressive 21,600 proposed units.”
The market data we collect, along with reviews of affordable housing policies across the country and the experience of our members, have shown us the best way to create affordability in the housing market: adopting proven strategies “More housing is the solution, and that add to the housing supply,” our priorities are to help increase Imse wrote in an article on supply and educate politicians on Oregonlive.com in early 2016. the fact that simply adding fees and making business harder has Barrier to constructing the reverse effect on the problem they want to solve,” Multifamily new apartments need NW’s Imse wrote in an email to to be removed the Portland Mercury. “To increase the overall housing supply, we need to remove barriers “As the organization representing to building. This includes updating property owners and managers, zoning codes to allow for a wider Multifamily NW has adopted a variety of housing types at a range of price levels. “At the same time, we should streamline the process for development review and permitting new construction while retaining standards for high-quality buildings. Under the current process, approvals can take a year or more, adding to project costs and delaying the construction of much-needed market-rate and affordable units,” Imse wrote.
Landlords trying to do the right thing caught in the middle McIsaac said Marsh tried to work with the existing tenants on solutions-oriented approach to payment plans and provide plenty address the housing shortage. of lead time and help moving if Imse's image on protester's poster photo ©Multifamily NW
they decided not to pay the rent increases. Most tenants decided to stay, he said. No lawsuits have been filed. “But they have come up with some non-factual statements about how he has treated tenants and what he has said to them. And he has bent over backwards, and so has the rental company, to make it easier for tenants,” McIsaac said. “So it is interesting here in Portland the media has not jumped on him, they have been extremely neutral on him. The head of the tenants union has taken it upon herself to negotiate with landlords on behalf of the tenants and she is not a lawyer, not a property owner, she’s just an activist,” McIsaac said.
Property managers bullied as activists marched into property management office Activists were protesting at one event and then went over to the office of the property management company Marsh had been using to handle his rentals. “They marched into the A&G Rental Management LLC office and intimidated the people working there. Drove some of them from the main area back into their offices. They had to lock themselves in their offices. And the principals continued on page 10
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Landlords, Property Managers Bullied
were not in the office at the time, so they basically attacked the support staff – not physically – but screaming, bullhorns, stomping, just marching through this office. It’s not very big, maybe a grand total of 1,000 square feet. So 30 of them came in there so it was pretty unpleasant,” McIsaac said.
drug dealers or domestic abusers, (SEIU). No-cause evictions are because that is what the law exists No. 1 and rental control is No. 2 for,” McIsaac said. but I think there are other things lurking underneath if they can get “His (Marsh’s) other properties these laws passed. have long-term tenants – his other two properties – and so it’s just a “If you have rent control you crazy, uncomfortable situation. I cannot improve your buildings. think the property managers and You have to be an altruistic the landlords are really willing to millionaire to improve a building work with tenants because of the with rent control because rent is Challenge of buying type of city we have here – but where you derive your income.” apartments at the tenants union has refused conversations and any negotiations Resources: market rates that are not absolutely in their “The bottom line is, if somebody Want to lower housing costs? Increase the supply favor,” he said. buys a new rental property at Portland Tenants United Picket Housing PAC market rate from somebody else “And they have a couple of Multifamily NW The high cost of rent control who owned it for 10 years, the politicians on their side,” McIsaac East Portland tenants plaster landlord’s owner is going to sell it at market neighborhood with flyers said. “Some politicians support value. The new owner is going to no-cause evictions and rent National Multifamily Housing Council have to raise the rents to make control. But they don’t know the Ash Street Tenants Association letter to landlord Landon Marsh the monthly mortgage. If you facts. If they did, they would not Portland tenants publicly shame their landlord
Portland Tenants United protest housing awards John McIsaac Communications and Public Relations Oregon's housing crisis too big to ignore opinion.
do away with no-cause evictions, do it. The Portland Tenants Union then you also do away with the is funded by the national Service ability to evict bad actors who are Employees International Union
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6 Key Insights To Millennial Apartment Renters
illennial apartment renters are willing to pay more for a “smart� apartment that is equipped with automated and remotely controlled devices, according to new research. The nationwide-survey was conducted with Wakefield Research of 1,000 U.S. renters in multifamily dwellings and gives six key insights to Millennial renters:
likely to pay more for an apartment an apartment than being close to that had "high-tech" door locks friends and family. compared to ones that did not. The Future: 45 percent of renters Smart Renters: On average, feel that physical door keys will be Millennial renters would obsolete in the next 10 years. pay about a fifth more for The survey was done by Schlage, smart home features. a brand of Allegion which Tech vs. Parking: 44 percent creates technologically advanced of Millennials would give up a lock products to help multiparking space to live in a "high- family property owners secure tech" apartment. and manage their units while streamlining operations. Advanced Security: 63 percent would move out of an apartment Millennial apartment renters want due to lack of security. technology
Lock Down: Millennials want tech upgrades right down to the locks, as more than 61 percent are likely to rent an apartment specifically because of electronic Work/Rent Balance: 64 percent "As the multi-family marketplace access features, including keyless feel that being close to work is continues to evolve with flexibility entry doors. In fact, 55 percent are more important when choosing continued on page 12
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6 Key Insights to Milennial Apartment Renters
being a key factor in most living situations, consumers can feel confident that Schlage's latest door hardware offerings are paving the way for a new era of convenience and security," Ann Matheis, marketing director, Allegion, said in the release.
with millions continuing to put off traditional life milestones like home ownership and renting rather than owning. Of millennial renters who live in multi-family dwellings, 86 percent are willing to pay more for a "smart" apartment, meaning one that is equipped with automated or remotely controlled devices, compared to 65 percent of Baby Boomers, according to the release. Nearly half of American renters in multifamily dwellings expect to be renting an apartment for the next five or more years, according to the release.
"Apartments won't look the same in 10 years, from the inside or the outside, and with our longestablished position in both the residential and commercial sectors, we have a unique vantage point that helps bring targeted, outcome-driven innovation to multi-family facilities because electronic access is the future," According to the release, Schlage Matheis said in the release. continues to innovate with Millennials recently surpassed smart multi-family technology, Baby Boomers as the largest including its latest launch, Schlage living generation on Earth, and Control™Smart Interconnected
Lock, recently named a "Top 101 Product" for 2016 from Building Design+Construction Magazine. Visit Schlage Multifamily for more information. *Survey Methodology This survey was conducted by Wakefield Research among 1,000 U.S. renters in multifamily dwellings, between Oct. 12-24, 2016, using email and an online survey. Results of any sample are subject to sampling variations. For the interviews conducted in this particular study, the chances are 95 in 100 that a survey result does not vary, plus or minus, by more than 3.1 percentage points from the result that would be obtained if interviews had been conducted with all persons in the universe represented by the sample.
Is The Horizontal Apartment The Future Of Rental Housing? The horizontal apartment - rental housing with high-end amenities built on small lots as singlefamily homes, with on-site property management handling maintenance on all units could be the future of multihousing rentals, according to several experts at a recent conference. The horizontal apartment panel with Mark Wolf far left, and Matt Blank second from right. By John Triplett, Rental Housing Journal
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Is The Horizontal Apartment The Future of Rental Housing?
Investors and developers with backgrounds in multifamily housing are putting up developments in Texas and Arizona to offer single-family homes that combine the privacy of a home with professional property management to take care of repairs, yard maintenance and more. These developments typically have the same high-end amenities of upscale apartment communities and appeal to both Millennials and Baby Boomers who want the freedom and flexibility of renting but with more privacy than a typical apartment complex.
another community or have other builders around us,” Wolf said of the Texas horizontal apartment model. “Part of that is driven by the financing. Our goal is to work for cash flow and utilize the type of commensurate financing you get in the multifamily world.
“We manage and maintain the yards, the exterior of the homes, fix anything that goes wrong in “We have a multifamily-centric the interior – just like you would background as a company so in an apartment. Yes, we fix things we very early on engineer this when things break down.” product to be financeable like an apartment. That is why we have Wolf said the investment is on-site property management, “typically between $20 million the amenity package, and the and $40 million and involves continuity throughout the institutional capital. We want to community where we can make sure we maintain that to a identify in a geometric manner high level of sustainability.” with no breaks in our ownership of 200 houses. The Arizona horizontal
The developments typically have 100 or more rental homes closely grouped in suburban areas near larger metros. “We have as small as 82 houses in one development and as large as Mark Wolf, chief executive officer 364. The sweet spot is probably of American Housing Ventures, capped out around 200 or 225 told a group of investors at houses in our new model going the Information Management forward from our experience in Network conference in Phoenix the last couple of years. If we were during a session on the horizontal looking at 250 I think it would be apartment panel that his company a home-run deal. has been investing in the Central Texas area and building “We are ground-up. We build communities from the ground up. all the lots ourselves. We want to have a say in how the land is engineered,” Wolf said of the The Texas horizontal horizontal apartment concept.
apartment model
“We do not want any outside interference or competition. To the best that we can, we try to identify parcels that will stand on their own. We do not want to be part of a master plan or
appropriate to the community. It’s not a 4,000-square-foot class A multifamily center. Our valueadd to our tenant base is a house,” Wolf said.
apartment model
The horizontal apartment model in Arizona typically involves a large number of lots and rental homes clustered in a larger master-planned communities, said Matthew S. Blank, principal with BB Living and with Blank Property Group.
“We team up with master plan developers. We may have 1,000 lots as part of a 5,000 lot development such as Verrado or Vistancia. We take 20 acres and create the community ourselves. We put in the full amenities you Are you cutting the see in multifamily housing – dog lawns? parks, pools, etc. Then we leverage “We put in the community the amenities around us in the center, the pool, clubhouse with a larger community,” Blank said. functional kitchen. It’s small. It’s
continued on page 17
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Is The Horizontal Apartment The Future of Rental Housing?
“We go into the master planned What about HOA community to attract corporate relocations, tap into good school issues? districts, golf courses, and parks,” “We are our own homeowners Blank said. association for that reason,” Wolf said, to avoid complaints from “We do professional property home owners about having too management on-site” in these many renters in the horizontal planned communities, he said, apartment community. “so we stand out from the momand-pop investors who may be “We run into these issues,” said out of state and not aware of Blank about Arizona because how well their property is being his properties are part of larger maintained.” planned communities. “We have had Facebook pages dedicated to us” that are not positive. How long do tenants when we go in we stay in these horitzontal “Typically rewrite the CC&Rs (Declaration apartment rentals? of Covenants, Conditions, and “We hope they stay four years to Restrictions) to remove the rental seven years as people keep their housing restrictions,” Blank said. kids in school,” Wolf said. “In many communities there are Blank added, “People who rent already a large number of rentals from us are most likely to buy a – they are just illegal according to house in the future. Since 2012 our that community’s rules. They just turnover rate is about 30 percent. do not know the rentals exist.” Our product demands premium rent. We are not sellers of homes How does the financing on a one-off basis.
Wolf said with projects between $20 million and $40 million, “we are more like multifamily financing. About 35 percent equity and all the land development and construction loans which are harder now.” “We have approached HUD (U.S. Department of Housing and Urban Development). Regional banks are much easier to work with than the big national banks,” Wolf said. “We want standard apartment style take-out loans.” “Our largest project needs about $16 million. We have private equity groups who like our strategy. The financing on the debt side is challenging. Good community banks are the best to work with,” Blank said. “We hold for cash flow and we are generally expanding, not selling,” Wolf said. He added it takes about two years to build and complete a development.
work?
Blank added, “I think you will see a trend where the institutions will be “Our renters want to feel like they “We want standard apartment buying in the future. Our expenses are moving up when they buy – style take-out loans,” Wolf said. are 25 percent to 28 percent and we are seeing a move out to buy “The idea is to get traditional you can see the efficiencies. apartment financing. houses,” Blank said.
continued on page 19
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Rental Housing Journal − Multifamily Magazine
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Rents Rising Fastest Amongh Low-End Apartments
“When people get to rent a new Resources: house, they treat it like a new house. When they go into a classic American Housing Ventures apartment, they treat it like an BB Living Information Management Network apartment,” Blank said.
Costs per square foot? Blank said they are building townhouses that average about 1,800 square feet and they put 10 or 11 per acre with a cost “in the mid 80s” per square foot with rents starting at $1,500 per month. Wolf said they build at about $70 a square foot with 1,500 to 1,600-square-foot homes with a two-car attached garage and rent for $1.05 a square foot for a 1,900-square-foot home and $1.25 a square foot for the smaller homes.
Blank Property Group About Mark Wolf
Wolf is CEO of American Housing Ventures and manages new acquisitions, strategic partnerships, investor relations and operations. Since inception, he has overseen the acquisition of over 1,500 lots, construction of homes and secured capital commitments of over $300 million. Wolf was a founding partner of the multifamily platform at Greenlaw Partners in Newport Beach, where he was responsible for the oversight of multifamily investments. In addition, he was the founder and managing principal at Sicuro Realty Partners, a multifaceted advisor capital provider for the multifamily sector.
About Matthew S. Blank Matthew Blank is a co-founder of Blank Property Group. Prior to forming BPG in 2011, he was a senior equity analyst at Long Pond Capital, LP, which is a long/short hedge fund focused on the real estate sector. At Long Pond, Blank specialized in the multifamily and single-family housing markets. Blank also previously worked at Morgan Stanley Real Estate, where he focused on investment banking, private equity, and the capital markets. At Morgan Stanley, Blank worked with a range of public and private clients in the real estate industry, focusing mainly on the apartment, strip center, office, and healthcare asset classes.
What Is The No.1 Challenge Faced By Property Managers? 6 Findings About Property Managers In New Study By John Triplett, Rental Housing Journal
A
country responding to the survey Gail Phillips, executive director called the State of the Property of the National Association of Management Industry. Property Managers.
The survey was done from June 6, 2016 to July 7, 2016 by Buildium. com and the National Association of Property Managers, with property managers across the
Among some of the interesting statistics were that 55% of survey takers were women. “In the property management industry our population tends to skew a little older and the older the population the more women we see,� said
new survey of property managers shows six major findings in the research from 1,500 property managers around the country.
Half of the survey takers were over 50-years-old, and half said they were owners of the company, while 87 percent had been in business for more than three years.
continued on page 21
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What is the No. 1 Challenge Faced By Property Managers?
Most are looking to grow their portfolio next year and looking at ways they can find other investors.
What is the most effective way to grow you business?
Finding No. 1
Phillips, executive director of the National Association of Property 80 percent of property managers Managers who participated in the manage the property of other survey with Buildium.com. investors, with 29 percent managing a mix of their own and Why have we seen so other's portfolios. And, 48% of much growth? property managers have portfolios which include property they own. “Our leadership has seen different Of those, 19 percent manage only types of growth. Some of them are acquiring other companies,” their own real estate. Phillips said. In California there has been a change as they have A focus has been on growth. seen influx of both landlords and Portfolios have grown in the last renters, especially Millennials. two years – not necessarily revenue The more of them that have been growth – but portfolio growth. added to the market, the busier it is becoming. There is no clear And growth is expected in the “yes” or “no.” “We still have those next two year. Mixed portfolios investors out there,” she said. And performed the best closely followed some members are picking up work by third-party portfolios and from investors who have bought. followed by self-owned portfolios. While growth does not always go hand-in-hand with profitability, Finding No. 2 she said, 94 percent indicated they Property managers are in the are seeing profitability, 50 percent middle of a high-growth cycle, are very profitable, only two with 94% reporting a profitable percent reported losing money and business, and 89 percent expecting four percent breaking even “which to grow in the next two years. is incredible for any industry.” “There is really good news based out of this survey” about profitability,
What is the no. 1 challenge faced by property managers? Finding No. 3 – Finding reliable vendors is the top challenge faced by property managers, and good communication is their most important skill set.
continued on page 22
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What is the No. 1 Challenge Faced By Property Managers?
Most property managers, 82 What is your biggest On the question of what motivates percent, said they charge fees as a property managers: owner challenge? percentage of rent, and 57 percent ∙∙ Being more efficient – 31 percent say they charge between eight and 41 percent say inexperience and ∙∙ Make more money – 23 percent 10 percent, while 24 percent said lack of understanding how the ∙∙ Helping people – 21 percent they charge between five percent process works. ∙∙ Having more free time – 13 percent and eight percent.
Finding No. 5
Those charging flat rates, 35 88 percent of property managers percent of them, charge between use dedicated, cloud-based $100 and $149. property management software. This is just property management Buildium.com who did the survey fees is a technology company, and said there is a growing importance of technology in property management. Tenant screening is the most popular service they use.
What is the key to success in your business?
∙∙ Communication is the key to success – 60% ∙∙ Organizational skills and staying in control – 35% ∙∙ Hiring and technology – 30 percent
Finding No. 4 43 percent of property managers prefer working with intention investors and 41 percent find inexperience the top challenge in working with owners.
Finding No. 6
44 percent say they prefer working 95 percent of property managers say with owners who intentionally they love property management, and nearly a third are motivated by acquire larger portfolios. being more efficient at work.
∙∙ Pleasing the boss – 6 percent ∙∙ Advancing career – 5 percent
Get the full report here from Buildium.com
P
How Much Do Property Managers Charge And How?
roperty managers across the country in a recent survey were asked, “How do you charge in property management fees? As a percentage of rent or as a flat fee?” The survey was done earlier this year in June. “This is the first time the question has ever been asked at NARPM, normally we do not address the fee question,” said Gail Phillips, executive director of the National
Association of Residential Property they could be in a Home Owners Managers who participated in the Association (HOA). survey with Buildium.com. The survey of property managers The majority charge as a percentage showed six major findings of rent. And in the survey 82 percent in addition to the property said they charge as a percent of rent management fee information in each month. Another 13 percent the research from 1,500 property charge a flat fee each month. managers around the country. Then, another seven percent do not charge at all. The no charge The survey was done from June 6, for property management could 2016 to July 7, 2016 by Buildium. be because they may be handling com and the National Association their own property and thus their of Property Managers, with own property management or continued on page 24
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Rental Housing Journal − Multifamily Magazine
What is the No. 1 Challenge Faced By Property Managers?
property managers across the country responding to the survey called the State of the Property Management Industry.
How much do property managers charge? Buildium.com said they wanted to go about this in the survey, “So it didn’t look like we were trying to fix prices or anything,” said Darcy Jacobsen, Director of Content, for Buildium.com.
information to competitors, we have to be careful we share statistical data. In using the range, of eight percent to 10 percent, the five percent to eight percent, in the survey we asked the range so it would allow us to give you the data without it looking like we are setting prices or telling you how to charge. So we used a range to be able to ask the question and to be able to share it with you statistically. So you will know
month, 57 percent are charging between eight and 10 percent and 24 percent between five and eight percent, which is slightly down from last year. That may be because of increasing rents in many markets across the U.S., Jacobsen said.
Some property managers charge a flat fee
“Then we looked at folks who charge a flat rate, and found that Then Phillips added during the So the survey found of those who 35 percent charge between $100 webinar, “Any time we share are charging a percent of rent each continued on page 25 what the market is doing.”
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What is the No. 1 Challenge Faced By Property Managers?
and $149 a month and another 31 any other types of tenant fees. percent between $50 and $99 per See the full report on the survey month,” Jacobsen said. here. “Interestingly that is actually up a bit from last year. Our guess is Resources: this must have to do with rising rent prices or a different mix of National Association of Residential folks who took the survey. We also Property Managers saw this where perhaps a percent of rent would be a substantial Buildium.com increase due to rising rent rates,” Jacobsen said. “It is interesting to compare what is being charge” Jacobsen said. “This is just for property management fees, “ she said and does not include
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3 Smart-Home Technology Ideas That Add Value To Your Rental Unit Adding value to your rental units can frequently help get new tenants, and help to keep the ones you. Here are a few devices to consider.
By Kristin Flores, Rental Housing Journal
A
mong the products that are a result of our incredible leaps and bounds with technology, smart home technology has become increasingly popular for homeowners and the rental housing industry.
With the advent of technology such as the Amazon Echo , the infamous Siri and various other devices that make your life easier, smart home technology has been weaving itself into our daily lives. From our most basic appliances
being able to control almost everything in your home with your cellphone - even if you are in a completely different country! Property managers, landlords, tenants and homeowners alike can continued on page 27
Rental Housing Journal − Multifamily Magazine
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3 Smart-Home Technology Ideas That Add Value to Your Rental Unit
all benefit from these devices. This technology can help save money, energy, help ensure safety and can be incredible selling points for any rental unit. As someone who lives in a home where almost everything is tethered to each other, and can be controlled remotely, I cannot express how wonderfully convenient having a smart home is.
∙∙ Smart thermostat options that provide the ability to control the temperature of your home remotely. There are even vent monitoring systems that control the temperature room by room that work in conjunction with these smart thermostats.
∙∙ Light dimmers can also help save electricity, money and can add a little something extra to how your rental units can adjust to the tenants’ personal lifestyle.
Admittedly, these light dimmers have saved me from myself countless times. I am the exact opposite of a morning person and I tend to forget to turn off the kitchen or hallway lights on my way out to the office. Think of that scene in Wall-E when he wakes up and gracefully bumps into everything on his way to charge his battery for the day –that’s me.
Although these types of smart thermostats can seem pricey upfront, but each rental unit or home with these can and will pay themselves off eventually. With saving money on electricity bills on an additional charge, Saving everyone money tacking the potential of profit is definitely Fall is here and, brace yourselves, there. Plus, it doesn’t hurt to put winter is coming. The fall and a little extra effort into living ecowinter nights are dark and full of friendly and green, right? Ensuring safety terrors... like increased utility costs Safety and home security are and accusing questions like, “Who the top most concerns for any turned up/off the heater?” homeowner, tenant and property manager alike. If you are considering adding any smart home technology to your rental units here is another: ∙∙ Smart locks are also another incredible accessory to have. You can help assure your tenants of their home’s safety and help save you money in the long run by adding things such as a lock camera, keypad and security cameras.
While these accessories can have a hefty upfront price tag, imagine how quickly these will pay themselves off in just a few years or even less time than that. Instead of needing to spend, say $50, to remake keys every time you have a tenant move out, change the locks or get completely newones, the only expense you would need to worry about is the time it will continued on page 28
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3 Smart-Home Technology Ideas That Add Value to Your Rental Unit
take to reprogram the locks and from our phones. As an added explain how to use them to your bonus,the Energy Trust of Oregon new tenants. offers a $50 incentive for those who install any qualifying smart thermostats. Amenities and
convenience
Parking, in unit washer/dryer, dishwasher and fitness facilities are amongst the top most standard amenities tenants seek out in their new homes. Now, imagine how these additional smart home devices could make your rental units that much more desirable. Especially to the millennials that believe technology makes our lives easier and also takes up the majority of the renting population.
can help save you and your tenant money. It can help save themselves from forgetting to lock a door or turn off their lights when they’re not home. Smart home tech can also provide you and your tenants There are hubs that are available safety and peace of mind. that can tie all of these products together even if they aren’t made By providing tenants these devices, by the same company. In my it can not only entice them to own home, we use the Harmony contact you to rent your available Hub that can control our Nest units, but also make your complex thermostat and our Lutron light seem modern, safe, up to date dimmers. The Harmony Hub can with trends and help save everyone even connect to your televisions some cash. and gaming systems.
Add value to your rental and benefitting everyone
Smart home technology can be Let’s not forget the potential in an incredibly useful asset to add advertising your rental units with to any rental unit. These devices all of these new additions as an apartment that can adjust to their own personal lifestyle. Lutron light dimmers can allow the tenants to adjust their daily lighting. Smart thermostats such as the Nest learn your schedules, adjust accordingly and has options to set temperatures for certain hours in the day and night. For example, I have a Nest in my home and I find it to be incredibly helpful. When the Nest cannot detect when our phones have not been within range, it will shut off its automatic temperature adjustments but will let us manually adjust the settings even
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1) The pet(s) shall be on a leash or otherwise under tenant’sGarbage control Cans when it is outside the tenant’s dwelling unit. TV Antenna/Cable 2) Tenant(s) shall promptly pick up all pet waste from the premises promptly. 3) Tenant(s) are responsible for the conduct of their pet(s) Fireplace at all times. 4) Tenant(s) are liable for all damages caused by their pet(s). 5) Tenant(s) shall pay the additional security deposit listedCleanliness above and/or their rental agreement as a condition to keeping the pet(s) listed above. 6) Tenant(s) shall not allow their pets to cause any sort of disturbance or injury to the BEDROOM other tenants, guests, landlord or any other persons lawfully on the premises. 1 7) Tenant(s) shall immediately report to landlord any typeWalls of damage or injury caused by their pet. Windows 8) This agreement is incorporated into and shall become part of the rental agreement exe -cuted between the parties. Failure by tenant to comply with any part of this agreement Blinds/Drapes shall constitute a material breach of the rental agreement. _____________________________ Landlord
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Pursuant to RCW 59.18.150, this is your Counter Tops 48 hour entering the dwelling notice that your landlord Locks unit and premises or their agents will located at (Address) ________________ Cabinets be ________________ Ceilings ________ ________________ Sink ________________ Electrical Outlets ______ between the hours Floor Rods of Garbage Cans (Date) and . Windows (Time) Floor TV Antenna/Cab (Time) le The entry will occur Blinds/Drapes for the following purpose:Fireplace Light Fixtures ________________ ________________ Cleanliness Doors/Woodwork________ ________ ________________ ________________ ________________ ________________ ______ ________________ Locks ________________ ______
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