Should You Collect A Rental Application Fee??

The application process is the first step in verifying rental references, performing vital credit checks and gaining a commitment from your potential tenant.  Application fees not only compensate you for your efforts involved in screening an applicant but also can help to reduce the number of unqualified applicants who may apply for your property. Applicants with a history of non-payment or bad credit often will not move forward with an application if there is a fee involved, however if there is no application fee collected they will move forward thereby wasting your time.  Additionally, the collection of rental application fees sends a clear message to your applications that you handle the operation of your rental business in a professional manner.  From the beginning this will serve to establish the tone that you are not a pushover and that while you are providing your tenants with a service, you also expect them to maintain their end of the agreement.  A few things to keep in mind when establishing your rental application fee policy, the fee needs to be the same for all applicants and once collected you must perform the screening or return the funds.

The 5 Best Things About Property Management Technology

Over the last several years, the technology being utilized to assist with residential property management has changed by leaps and bounds!  Where it used to be that only hand written tenant ledgers were possible, the new technology allows for accurate electronic tenant ledgers, up to the minute accounting, constant communication with tenants and residents and much more.  Additionally, it is a great way to document and communicate issues within the "Rental Property Triangle" of the tenant, owner and property management team.

Here are just a few examples of how the new technology assists with residential property management:
1. Property owner 24/7 access to information about their property
2. Detailed accounting record regarding the cost and revenue of your rental property
3. Faster response time to your questions and quicker resolution of issues for your tenants
4. Less owner time spent dealing with getting facts clarified - no need for owner's to wait for the one assigned staff member to return their call as all staff can access the electronic system to read through detailed/accurate notes
5. Electronic history of important details about your property

When shopping for Phoenix residential property management services, be sure to inquire about the property manager's current technology and access for property owners and tenants as it could be the difference between selecting just a property manager or selecting the best property manager!

The importance of Inspections

As Phoenix Property Managers, we know that as a landlord, you have a number of worries and responsibilities. It is not only important to make certain that your investment is protected, but it is just as important to ensure your home is safe for habitation. One of the best ways to accomplish both goals is with inspections. Conducting a move-in inspection documents the condition of the home when the tenant takes position so that there is no confusion at move-out. Periodic inspections preformed during the lease term provide an added incentive to tenants to keep your property in good shape, and you should have fewer problems with tenant concerns regarding defects or issues that are not being addressed. Additionally, by completing these periodic inspections it will be more difficult for your tenant to sneak in for example an unauthorized per or unauthorized occupant. Also, inspections are a good way to quickly nip any costly damages that may be occurring in the property. So to protect your investment remember with each tenant to complete a move in inspection, periodic inspections throughout the lease term and a move out inspection.

Rent Check

According to Rent Check, ARML's monthly publication showcasing the Phoenix residential leasing market, rental properties were on the market on average 46 days in November 2013.  Additionally, the median lease price was $1095.  Executed lease agreements have been trending down since August which had a peak for the year of 4209 homes leased as compared to October with total homes leased of 3311 and November with 3297 total homes leased.  One reason for the decline in executed lease agreements may be because the previous homeowner's who became tenants during the housing bust a few years back can now purchase again with some loan programs only needing a minimum of one year from a foreclosure.  With executed lease agreements trending down, competition for landlords is high meaning that how a property shows cosmetically and the price are more important than ever.  Additionally, with the holidays this month and people low on funds from the holidays next month, we can expect even lower rates of executed lease agreements until most likely February/March of 2014.

Leasing Tips: Quickly Filling Vacancies

Marketing a phoenix investment property home and finding a good tenant is critical, as the cost of a vacancy is the single highest expense for phoenix investment property owners. The top priority is to keep rental income coming in by quickly filling vacancies with tenants who will pay and care for the property.

How Long Will It Take To Rent My Property?

The average rental home stays vacant for about 52 days, and can be higher than 120 days if the home is not in rent-ready condition or if the rent is priced too high compared to other homes tenants can choose from.

The Right Rent Price

Unfortunately, the phoenix rental market is indifferent to your monthly mortgage. If you are holding out for $1200 in rent when the market rate is closer to $1000, you are only prolonging the inevitable, as rental prices typically don’t change within a 90-day period.

Let’s assume that market rent for your home is $1,000/month, but you need $1,200/month. Now let’s assume that after two months of vacancy, the property rents at $1,100/month for 12 months. How much actual rent are you receiving over that 14 month period, (2 months vacant + 12 months occupied)?

12 x $1,100 = $13,200 divided by 14 months = $943/month!

If you had set the price at the market rate and rented the property at $1,000/month (market rent) right away with no vacancy, you would have made $798 MORE MONEY over the same 14-month period!

$1,000 x 14 months = $14,000

$  943 x 14 months =  $13,202

                                     $798.00

In this scenario, you would have lost $798.00 by trying to get higher than market rents.

Real Property Management has specialized expertise in area rents and market forces. Rely on us to help you set rent in a way that balances your ideal with shorter vacancy times.

The Right Condition

Your home must stand out and be in rent-ready condition to compete for tenants. Or, if you are unable to make improvements due to budget constraints, the home must be adjusted below the market to offset the quality of the home. Available rental property is at an all-time high due to the number of foreclosed homes that are being rented by banks to create cash flow, so tenants have more choices. Again, what you are trying to save in maintenance and upkeep costs may end up costing you in longer vacancies, so you are wise to improve the condition or adjust rents down accordingly.