Handling Tenant & Owner Funds

One large task of a property manager is handling funds. This involves making informed decisions about all aspects of the property, which goes past physical assets. Property managers are in charge of things like rental income, security deposits, reserve funds, and writing checks on the owner’s behalf.

Payment Schedule

The property manager is in charge of picking the date that tenants will be responsible for paying their rent. They are also in charge of determining if the tenant pays for the current month or if the property will hold the check for a month. The property manager may also be responsible for setting up a direct deposit if the property wants to offer that feature to their tenants. It is recommended that the rental revenue is in the bank account collecting interest rather than in the bank manager’s account.

Taxes and Accounting

The property manager may make the decision if the company will provide an IRS-1099 and a summary profit and loss statement when tax time rolls around. The property manager may also be responsible for having a paper trail when it comes to accounting. This may include keeping detailed documentation and records. The goal is to make everything crystal clear if an audit were to occur. A desirable company keeps copies of all invoices and is happy to provide them upon request. This helps with legal issues and taxes.

Reporting

Income and expense statements should be reported each month. It is advisable to avoid working with companies who report any less than this. Something else to watch out for are income and expense statements that are viewable online. This makes the documents a lot more accessible than just a paper copy. Lastly, it is important to ask for a copy of the report beforehand because you are giving the company a chance to show if they are able to give you a report. The report can contain fake or “dummy” data because you are just inquiring to see if they are willing to share a report with you. If they are not willing to share a report, re-evaluate your options. If they are willing to share a report, make sure it is organized and easy to read.

Covering Your Property Insurance

High rise buildings provide a lifestyle that many seek because of the benefits. These benefits include a safe place to live, pools, great views, and an elite lifestyle. Just like the many reasons that people love to live in high rises, there are many requirements to insuring a high rise property as well.

Know Your Role

Insurance coverage for high rise is broken into two sections. Part of the responsibility falls on the property owner and the other part falls on the association. To clarify, the association is responsible for policies for certain areas of the high rise. These areas sometimes include the pool, gym, and the lobby The “structure” of the property applies to the “perimeter boundary walls out.”

The unit ownersare responsible for the “perimeter boundary walls in.” The requirements vary depending on the part of the country. Unit owners need to purchase insurance that covers upgrades beyond a standard unit and personal items.

Ask for Help

When insuring a property, it is important to do your research. A critical part of the research is finding a reliable insurance broker. It is recommended to find an expert to help you find the right broker. You need a broker with experience in the industry who will not cost you money on mistakes that are easily avoidable. A brokerage firm is equipped with the connections to find someone with the experience that you need for your property.

Think about the Value

It is tempting to think about savings when it comes to finding the appropriate insurance policy. However, it is important to think about the big picture, including potential gaps in the coverage and insane deductibles. Value, in this case, means the plan that offers the maximum amount of coverage at a reasonable price point. The point of an insurance policy is to give you peace of mind, so it is important that you are not constantly doubting the decision you made because you went with the cheapest insurance policy.

Review it Constantly

It is tempting to pick a plan and not think about it again until you need it. However, it is smart to review the plan at specific intervals to makes sure that the coverage is enough for the property.

The Basics of Property Management

Many real estate investors are looking for professional management companies to help them with the day to day operation of their properties. This is because there are time-consuming processes that are included in the management of rental companies and property owners may not have the time to deal with them. Here are a few things a property management company can do for you.

Find New Tenants

A vacant property will be costing you money, so it’s important to keep every unit occupied. However, a tenant who is destructive, or one who has difficulty paying their rent, can be worse than having a vacant unit. Property management teams will create attractive ads that will attract applicants to the property. Once they begin reviewing applications, they will use a thorough screening process to help find tenants that present a low risk.

Managing Each Tenant

Your management company will serve as a buffer between you and your tenants, so you can dedicate your time to other matters. They will begin by having new tenants sign leases and move into their apartments. They will also make sure repairs are made in a timely manner and take care of common areas of the property. Any concerns or questions the tenants have will also be met by the management team to ensure the continued smooth operation of the property.

Preparing Vacant Units

Whether a tenant vacates on their own or gets evicted, the management team will also tend to the new vacancy. This will start with processing a tenant’s notice that they’re vacating, or filing an eviction notice with the court. Once the tenant has moved out, they will send maintenance and cleaning personnel to update the vacant unit. This may include making minor repairs, repainting the unit, and cleaning the unit to meet with the approval of the next tenant.

As this overview suggests, there’s a great deal of work that goes into preparing and renting out the units on your investment property. A professional management company can handle these tasks for you at a reasonable rate, so your days won’t be bogged down with these administrative matters. This frees you up to pursue new investment opportunities, or to enjoy your free time with the peace of mind of knowing your property is well tended.

What to Consider as a Home-Based Worker When Renting

The pandemic has shut the doors of corporate buildings; people are working from home. This trend will continue either out of choice or as a necessity. Annually, 10% of people move from one house to another in the US. Most of these young people shift either for business or personal reasons.

Formal workplaces are not the safest environments for social distancing. People always share equipment; such as staplers, printers. Companies have relatively squeezed spaces for their staff. There is speculation that more people will decide to work from home long after the pandemic has passed.

Home-based workers will have to adjust their spaces at home to accommodate both their personal and office needs. Some of the considerations to bear in mind include;

1. Make Space

Most people assume that a person needs a large house to have a home office. A person has to create the workspace regardless of the size of their house. He/ she can turn a room meant for another purpose into his/her office. A committed home-based worker can work from anywhere in the house; even the kitchen counter.

2. Do Not Inconvenience Your Neighbors

A successful home-based business gets more clients as well as employees. Frequent clients to the house should not take up all shared space from your neighbours. Rented houses have clear regulations that a home-based worker should adhere to; evacuation might inconvenience your business.

3. Expect Change

Home-based work, just like formal offices, factors future needs to scale up. When a person starts working from home, he/she should not set up for permanence; especially in a rental.

4. Manage Your Family

Working from home presents a new challenge that needs management. Kids might become a distraction and lower your productivity. Home-based working parents should set their home offices far from any family interruptions. Renting should account for this adjustment; so those parents aren’t interrupted.

In summary, the above are not house hunting tips, just mere considerations for renters who work from home. These tips will be more suited for Post-Pandemic house hunting. Renting at the moment would not be wise. However, it is healthy to consider what the future holds. With the overwhelming loss of life at the moment, a distraction such as planning for the future is necessary.

Why Slashing Property Prices in California is the Solution for Making More Sales

Asking price for most home sellers is reducing at an alarming rate. Many sellers have to reduce their prices to ensure they remain in the market and the property off their hands. When companies are laying off workers and filing for bankruptcy, it is a no-brainer why the prices are plummeting.

San Francisco, California, has not been spared of the slash in home prices. Sellers have to lower their costs to remain relevant and competitive. San Francisco faces a 6% increase in home sales, totaling 1,360 unseen numbers for over a decade. The changes come as a result of people seeking homes in less dense areas.

The global pandemic is destabilizing the markets plus affecting the purchasing power of many. It was only in 2010 and 2011 that there were so many houses in the market as it is now. A majority of the houses for sale are single-family homes at 50% more than last year and condominiums at 130%. In the Bay Area, there was a jump of up to 70% in single-family homes after April and May, as per NBC Bay Area reports through the California Association of Realtors.

Working remotely, people losing jobs, and some cities being half shut down poses grave decisions for the property market. Other people feel that two, three, and four-unit houses in Old Victorians are safe enough during the pandemic times. The multi-unit homes provide safety because of little or no shared spaces, a factor that is making it hard to sell condominiums.

As much as property prices are plunging, it is a good idea for those who can afford to buy themselves. When the economy picks up, the costs will skyrocket to the point they were or even higher. Single-family homes and condominiums in high rise buildings are very plenty in the market, and it is up to the buyer to make a move.

The Covid-19 pandemic has adverse effects on the markets, and home sellers are feeling quite a pinch. Reducing market prices means fetching a lower amount of money than the actual value of the property. Sales are operating at a loss, and yet that is the only way for sellers to keep afloat. With the pandemic’s existence, it is not clear if seasonal trends will hold for the property market in 2020.

What is the Future of Corporate Building Investment

The year 2020 has recorded a decline in the value of the real estate industry for the first time in two decades. This drop is due to the shift towards remote working by various companies in the USA. These efforts towards curbing the spread of the Coronavirus, are predicted, to last for the whole year.

Does this mean that investors should give up on corporate building investment? Not really, since office-based work is bound to resume soon. Soon people will miss the convenience of face to face board meetings and brainstorming. Furthermore, the home environment is not appropriate for work for most people. There are plenty of distractions from children and other sources that would be non-existent at an office.

Off course, the above mentioned possible reasons for the resumption of working from the office are all hypotheses. There are indicators that the post-pandemic corporate building investment might experience a boom. Some of the possible reasons for these are:

1. Need for Expansion

The social distancing guidelines might force firms to expand their working spaces. Investors will benefit from issuing more leases to companies. For every company that will terminate its contract, another will buy. The tiny office spaces that people complain about will disappear.

2. New Investors

The real estate industry enjoys unfavourable advantages compared to other businesses. The most extraordinary benefit is the ability of the real estate to be involved in all enterprises. In the Post-Pandemic period, the industry will require more investors to satisfy space expansions in all sectors of the economy. The industry accommodated the top 1%in society; it will welcome all capable Individuals in the post-pandemic period. Increased investors will naturally translate to the increased value of the real estate industry in the stock market.

In summary, the most lucrative business of modern industry, real estate, has been dealt a blow due to the pandemic. Fortunately, there are indicators that the industry might, after all, enjoy a steady boom in the post-pandemic period.

The industry of real estate is going to be more valuable than ever before. On top of the pre-existing demands in real estate, the need for Expansion will propel the industry to uncharted heights. Investors should be on high alert for this golden opportunity. However, all of this is just speculation we will have to wait and see as events unfold.

3 Musts for Property Buying

Home buying is the right decision when the expense and responsibility of ownership seem worth the effort to have a place to call home. People can feel ready as soon as they have a reliable job and money set aside for a down payment. However, there are other things that every first-time homebuyer must do before they sign their name on a mortgage document.

#1. Talk to Lenders

Homebuyers need a pre-approval for a loan before they begin to shop. Pre-qualifying is not the same. Qualifying only shows that buyers can receive a loan if they were correct with their stated income and credit scores. A pre-qualification involves research of credit histories, bank accounts, and more. An approval letter from a lender allows agents and home sellers to know the buyers are legitimate. Buyers have more negotiating power when sellers know the deal will not fall through for the lack of financing.

#2. Know the Area

A dream home can tempt people into buying a house in an unfamiliar area. Inexperienced buyers may think they will learn to love their neighborhood or the commute, but this is not always the case. Research the area to ensure it meets all preferences for services, jobs, community activities, and any other important factors. Make a list of all things that matter to each person who will live in the home and only shop for houses in areas that meet all or nearly all of the preferences.

#3. Buy Below Limit

Lenders may approve a loan up to $200,000, but that does not mean people should only look at houses in that price range. Always shop for houses well below the limit because ownership includes more expenses than many people expect. A less expensive home allows the owners to have money for improvements or repairs, as well as a financial cushion for when property taxes, utility costs, and homeowner’s insurance rates rise – and they will.

Buying a first home could be the start of a line of homes that includes upgrades to a dream home, or it may mean buying something affordable and turning it into the dream. Careful planning and shopping increase the chances of the experience becoming even more rewarding than the buyers expect.

Luxury Real Estate Changes Caused by COVID-19

The luxury homes of the future may look much different than they do today. The change in the needs and desires of the consumer has altered greatly since the COVID-19 pandemic began. Today, people want luxury, but they also demand safety.

More Remote Locations

The ultimate luxury location was once in the most active sections of metropolitan neighborhoods. The coronavirus lockdowns left many people stranded within the confines of their homes. Those who lived in urban areas were unable to leave their buildings, and compromising safety when they did. Homebuyers will not forget that lesson soon, and it shows in the luxury market as investors seek out suburban homes with private yards.

Lower Residence Address

The penthouse of any high-rise has historically been the most desirable location. Home shoppers now dislike the idea of long elevator rides where they may need to stay in a confined area with strangers. People now feel more comfortable with homes that exit immediately outside or are on a low enough floor for them to take the stairs. An exception would be extremely lavish apartments with private rooftop terraces and elevators.

Added Touchless Features

Touch-free door locks and elevator control panels also rank high on the list of preferences. The possibility of germs existing on the surfaces of all communal areas has become a serious concern. Elite shoppers now consider safety to be the ultimate luxury.

Increase in Independence

Large pantries, well-planned kitchens, and extra storage space in closets and laundry rooms also top the list of luxury necessities. People want to stay home in comfort and use fewer services where they may encounter other people.

Different Desirable Materials

Granite and marble were once requirements in any luxury home. Today, copper is the premium material. Copper fights germ naturally, so the homeowner has fewer worries about contamination. Copper counters and countertops made from other antibacterial and antimicrobial surfaces are expected to increase in popularity. Homeowners want protection against any germs brought in with them on handbags, grocery bags, and other items often set on countertops.

The luxury home market will not suffer but it will change. The switch may benefit less wealthy home shoppers who will discover the home of their dreams is now affordable. The change could also bring a boom to the redecorating industry as wealthy homeowners choose to upgrade their current residence rather than move.

Smart Building Strategies

Smart building is a long-term approach to recognize the relationship between the environment and its inhabitants. Smart buildings help owners understand what their tenants need. User experience is essential when designing smart buildings. Several strategies need to be incorporated to achieve this goal.

Pillars of a Smart Building Strategy

The smart building strategy should aim at a good tenant experience. It should aim at enhancing energy efficiency. Operational improvements are essential. Also, establishing a more sustainable environment is necessary. These goals need to be supported by proper security. Smart buildings are vulnerable to cybersecurity, and securing people and their assets from criminals is paramount.

Strategies to Improve Smart Buildings

Owners of smart buildings shape their services to meet users’ demands. Here are some strategies that can be used in smart building:

1.Energy efficiency

Having a holistic energy management option is essential. It should be able to give the energy usage of a specific space as well as the cost. The building should have an energy management option that can also monitor and verify predictive indicators. The options will enable regular energy analysis based on the results predicted. They can be used for tenant billing, green leasing, energy use reporting, tenant engagement, and tenant accountability.

Monitoring power quality and energy usage in intervals are essential. Sub-metering can also be used at a floor level. Tenants should have a dashboard where they can see their energy or power consumption.

2.Air quality monitoring

Tenants need assurance that a smart building is free from unhealthy air pollutants. They need a conducive environment for their health. Constant monitoring of comfort and air pollutant indicators is important.

Air quality parameters should be maintained below the recommended exposure limits. The data should also be available for the tenants on the dashboard. The occupants should also have a way to give their remarks on the comfortability.

3.Space management

The utilization of space is essential in a smart building. The building should have a functional building management system. The occupants should also be enlightened on how different spaces can be used in a smart building. There is a need to have control systems in shared spaces. The areas should also be equipped with a sound lighting control system.

Smart buildings are designed to offer a fantastic experience to its occupants. However, operational efficacy and management are also substantial.

New Affordable Housing Rules

The world of affordable housing can be a complex one. There are many rules and regulations that one must be familiar with when working in the world of affordable housing. Although, some people are advocating for a drastic change in these rules. The proposed change would switch from a voluntary to a mandatory approach to affordable housing.

Results from recent surveys have revealed that a majority of stakeholders would prefer to have mandatory affordable housing requirements that are consistent across the board. What is the motivation for change?

Affordable housing is a lengthy process. Even once the idea is agreed on, seeing the vision come to life can take years. While the process happens, there are often shifts in leadership that lead to changes in policy. Individuals and organizations alike are advocating for consistency in this process.

Another cause of inconsistency is the lack of trust in the industry. This lack of trust means that deals are constantly changing. Specifically, people feel like developers manipulate information and use it unfairly during negotiations. Developers feel this way about councils too. This creates a circle of distrust in the industry that can have a negative impact on negotiations.

The voluntary negations that are in place now mean that each project operates on a case-by-case basis. This means that there are different affordable housing expectations for each project which can create tension when the rules are different for everyone. Advocates for a consistent rate argue that this would create an even playing ground and increase consistency across the affordable housing market.

The United States is different from the rest of the world that mandates affordable housing contributions. These contributions are set at certain rates that are established ahead of time in the developer’s initial feasibility analysis. Some countries base these numbers on financial support from the government. Regardless of the basis for the numbers, they stay consistent across the board.

When individuals in the industry were surveyed, this method was preferred to the case-by-case or voluntary method. The mandated method creates transparency and consistency in the world of affordable housing. It essentially takes the guessing out of the process and eliminates the need to wonder why some organizations get better deals than others.

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