As Broker of a small, service-based property management company serving the greater Sacramento area, I have the occasion to come into contact with investors from all walks of life. Recently during a meeting with some new clients in Lincoln, I was asked a few questions about the market in general, as well as current rental market conditions and trends affecting our area. Here are a few points worth mentioning:
1. The rental market is somewhat flat, with plenty of inventory in most areas, especially where the most new construction occurred during the last 12 years (Roseville, Folsom, Natomas, Elk Grove).There are some amazing deals out there for investors that have the cash and credit to buy in. The client I was meeting was in the process of closing on several homes, 2 of which sold for $580k and $280k respectively back in 2005. He and his partner were purchasing for $260k and $157k. While no one can definitively say how long the sales market will stay in this territory, it is clear that those with the ability to buy are doing so and are going to make a great deal of money in the process.
2. The most rental activity we are seeing is with smaller units where the focus is lower rent, and larger units where the focus is to move in enough people (up to health & safety maximum allowance) to accomplish the same goal- conservation is the word of the day. If you are planning on purchasing a rental property, the old idea of buying as much square footage as possible may not be the best plan. Renters are out there, but they are "deal-shoppers". Flexibility on lease terms are also important, as your best qualified renters desire to become homeowners sooner rather than later, making 12 month leases harder to secure.
3. Research is important. Check comparable rents in the areas you are contemplating a purchase, or better yet, retain the services of a property manager to assess the potential rental value for you. However, you should always check the rental rates in your area for yourself, as there are plenty of inexperienced property managers that promise a high rent that cannot be obtained, merely for the purpose of securing a signature on the contract, often trapping the client into a lengthy relationship that he/she may come to regret. Ask around- talk to your real estate agent- find out which property management company is right for you and your investment.
4. Know your true costs of maintaining an investment property. Most owners pay water, sewer and garbage, but this trend can vary from area to area. Rental properties need regular maintenance- most would agree that a safe estimate of maintenance costs over a 5 year period amount to 10% of the rent. Granted, this too can vary greatly based on the age and condition of the property, as well as the time and effort put into finding quality tenants to maintain the property. Again, here is where a good property manager can make the process not only easier, but more profitable in the long term.
If you or someone you know has questions about buying a rental- do not call us. We do NO Sales. However, if you or someone you know has questions about managing a rental, proper rental pricing, tenant qualification, or anything else related to property management, we are here to help. at Investors Choice Property Management, we like to think of ourselves as "the cure for the common property manager".
Investors Choice Property Management (ICPM) manages 108 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, we do NOT markup repairs, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say:
“Experience Property Management the Way it Should Be.”
As a small, service-based property manager serving the greater Sacramento region, we find it necessary to keep up with the latest rental trends. Each quarter, we compile a detailed housing survey where we compare the asking prices of 2, 3, 4 and 5 bedroom homes, duplexes and condominiums.
With data compiled from the local newspaper, as well as online resources (Craigslist, for example), we are able to capture a picture of the current rental market. Our latest survey shows a noticeable increase in vacant rental inventories in most areas, especially Elk Grove, Natomas, Roseville and Folsom. Furthermore, rental prices appear to be flat or even dipping slightly in almost every category since last quarter.
Given concerns over the economy and the job market, it is no surprise that we are seeing the most activity on smaller units, 2-3 bedrooms maximum, while interest in 4 and 5 bedroom units has lessened. We believe this represents a trend towards conservation, and that this trend will continue until we see more stability in the economy.
What does this mean to Landlords with a vacancy? Simply put, we are in a renters market where condition and location take a back seat to pricing. An aggressive pricing strategy must be employed to attract the most qualified renters to your vacancy. Even Landlords with occupied properties would do well to take a hard look at comparable rental prices in their area. In some case, we have been able to successfully renegotiate a slightly lower rent to prevent a costly turnover in a saturated area. It is just another way that being proactive can get you out ahead of the problem, in fact solving it before it develops.
Our survey is available at our website along with a complete list of our rates and services provided. If you or someone you know is ready to start being managed personally, professionally and proactively, give us a call or email. ICPM pays one of the highest referral fees in the region, does NO Sales, and is happy to refer your client back to you for any future sales activity.
Investors Choice Property Management (ICPM) manages 108 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say:
“Experience Property Management the Way it Should Be.”
Having been in property management since 1992, I have seen up and down markets, but never anything quite like this. Normally we see solid rental activity during a prolonged period of stagnant sales, yet inventory of vacant properties remains fairly high, while rents are flat or even sagging. I suspect more and more people are tightening the belt, moving in with family to save money while the economy works itself out.We have taken the position of getting much more aggressive on rental pricing, to attract whatever qualified renters we can during this tough market.
If you or someone you know has a question about property management in the greater Sacramento region, feel free to call or write. We are always happy to share information.
Investors Choice Property Management (ICPM) manages 108 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say:
“Experience Property Management the Way it Should Be.”
I think 2009 will be a pivotal year for us in the property management business. Investors appear to be re-entering the market, vacancy inventories are up while rental prices remain somewhat flat. As we get into summer 2009, our hope is that rental inventories will shrink as the next wave of foreclosures hits and people are forced to rent for the next few years while rebuilding their credit.
As the inventory of available rental properties declines, rental prices will inevitably rise, attracting still more investors and stimulating the sales market. We may see some fluctuation as foreclosed homes are purchased and introduced into the rental market, but demand for rentals should begin to match or even outweigh supply.
No one has a crystal ball to say exactly when the tide will turn, but summer 2009 is looking quite promising. Hopefully our friends up on capital hill don't do anything to muck things up further that they already have, and we can all look back on 2009 as "the year we turned the corner".
Investors Choice Property Management (ICPM) manages 106 single-family units with the care and diligence our Landlord clients deserve, in a manner that has them referring their friends, co-workers and family members. With over 16 years professional property management experience, our business is 95% word-of-mouth referral, we do NO Sales, and pay among the highest referral fees in the industry for management accounts. Visit our website at www.investorschoicepm.com today for more details, and find out what we mean when we say:
“Experience Property Management the Way it Should Be.”
It seems like every time I turn on the news, there is a piece about the economy and how it has impacted retailers. "Many retailers slashing prices by 40-70%" was a headline I read last week. I wonder just how true that statement is?
Mervyns went out of business recently, and had a major sale in their stores advertising 60-80% off. I was particularly interested in seeing if these drastic markdowns applied to their jewelry. I was disappointed (but not surprised) to see that the store management had applied hand-written price tags to their merchandise. A gold bracelet that would normally sell for $300 was listed as "original price $2399, sale price $399". It was a cheap sales trick designed to rope in unsuspecting customers with false promises of big savings.
I wonder how many other retailers are resorting to similar trickery to bolster their failing revenues? Fortunately, consumers appear to be a bit more cautious given the current economy.
The point is this- do not base your purchase on the price tag. Ask yourself if the advertised price seems reasonable, and do not give in to false pressure (I have to buy it now because the sale ends tomorrow).
Good luck and happy hunting this new year.
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Property Management in Sacramento, Rosevillle, Folsom. ICPM is the company for investors that value the quality service and skill that comes from dealing directly with a Broker. -NO Repair Markups-
In over 16 years as a property manager in Sacramento, I have worked with small companies and large ones, and have learned to appreciate the qualities of both. Many clients take comfort in the size of a large company, often overlooking their shortcomings with the rationale that "they are big....they must be good". In some aspects, a big company can be a safe haven for investors that want to hand their rental property over and trust that all will be handled well, having little or no involvement in the process. For others that prefer a more "hands on" approach, a smaller management company may be a better fit, where there is more time and care given to each rental.
One area where a large company may indeed fall short of the mark is in customer service. Overburdened with 2 to 3 times the number of rentals that anyone could manage effectively, the big company property manager is a master of juggling, spending only enough time with each client to keep them from leaving the company, but never keeping their clients truly satisfied. As a former participant in this type of management, I know just how much thought goes into managing 250-300 properties by yourself, and the answer is "not much". When I left big management, I vowed never again to compromise my standards of service, sacrificing profitability in exchange for a more meaningful, dedicated approach to my clients, their properties, and their often-overlooked tenants. It was a life-altering decision, and one of the best I have made in my career to date.
At present, ICPM proudly manages 110 properties with the skill and care our clients have come to expect, in a manner that keeps our clients referring their friends, neighbors and family members.
Our business is over 95% referral-based and we can name every client, their property and their tenants by name.
When we say "Experience Property Management the Way it Should Be", what do we mean by this? There is no short answer to that question, but read on and, if you like what you read, consider visiting our website for more information.
ICPM specializes in the exceptional management of single-family homes, duplexes and condominiums throughout the greater Sacramento area, including Roseville, Rocklin, Lincoln, Folsom, Natomas and Elk Grove.
As a proud member of NARPM (National Association of Residential Property Managers), as well as an affiliate member of SAR (Sacramento Association of Realtors), we are dedicated to upholding the highest standards of excellence within our industry. We attend ongoing classes to keep at the top of the learning curve, as well as to set a good example for our peers within the industry. Whether it's Fair Housing, ADA Compliance, Security Deposit Accounting, our clients have the benefit of dealing directly with a Broker that stays up to date on Tenant/Landlord issues affecting the greater Sacramento region.
ICPM charges NO MARKUP on Repairs, and receives NO KICKBACKS from vendors. Any savings we are able to secure from our vendors are passed on directly to our clients. Many companies mark up the cost of maintenance. Some of these profits are openly disclosed, others are concealed through clever wording on the contract. At ICPM, we strongly believe that properly maintained units are essential, but the maintenance is expensive enough without your management company "padding the bill". We are already being paid a management fee to manage our properties, and that includes maintenance coordination.
At ICPM, all properties are personally managed by a Licensed Broker that stays involved with our clients home(s). If you or someone you know is ready to stop being lost in the shuffle and start being managed effectively, we'd love to have your business. Once you experience property management the way it should be, you won't settle for anything less.
AGENTS: Did you know ICPM does NO SALES and pays one of the HIGHEST REFERRAL FEES? Call us anytime to find out more.
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