Owner and Investor Tips
KEEPING LIFE UNCOMPLICATED FOR THE OWNER
ASSISTING WITH THE SALE OR PURCHASE OF A PROPERTY
PROTECTING THE FUTURE VALUE OF THE PROPERTY
INCORPORATING ASSOCIATION REQUIREMENTS
KEEPING ACCURATE AND COMPLIANT FINANCIAL RECORDS
Property Management Accounting is comparable to non-profit "fund" accounting; i.e., complicated. I incorporate an industry standard for accounting software and have the personal, hands-on experiece necessary to provide you with complete and dependable records.
While I understand the differences between:
1. Future Value Investing, and
2. Cash Flow Investing,
I would appreciate your discussing with an accountant or business planner how;
Appreciation
Deductions
Depreciation
Amortization
if any, might be advantageous to your investment strategy.
The market is dynamic!
RENTAL MARKETS
RESIDENTIAL
MARKETING STRATEGIES’
A. Here are a few of our potential initial marketing categories:
1. $____.00 per month long-term unfurnished;
a. Times 1.25 for 6-months.
b. Times 1.5 for 3-months.
c. Tenants transfer utilities.
2. $____.00 per month winter seasonal furnished and equipped October through May;
a. Typically include most utilities (local phone, basic cable, sewer/water).
b. Electrical usage is addressed by establishing an allowance amount.
c. Owner & tenant alike leave general cleaning and other expendable supplies.
d. Two sets of towels per bath, two sets of linens per bed, etc.
e. Convenience appliances like mixer, coffee, blender, microwave, toaster, etc. included.
f. Basically tenants need toothbrush and clothing.
3. $____.00 per month summer seasonal furnished and equipped June through September;
a. Same as 2 above, just at a rate of approximately 2/3 of the Winter Seasonal rate.
b. Also, typically comparable to the long-term rate (our summers are “off season”.
4. $____.00 per month long-term furnished and equipped.
a. Some owner’s with furnished unit prefer this to paying for storing furniture.
b. Little if any increase in price.
5. We do not directly address “Vacation Rentals”, however, we provide a location for vacationers and owners alike to connect. See “vacation Rentals” on the website index.
B. Precaution:
- Some long-term property owners will not accept an advance rental, as in more than 30 days in the future, as that rental would prevent an immediate long-term rental; i.e., long-term owners typically should only accept a reservation within 30-days.
- Seasonal owners would accept a next season reservation anytime as that is their primary goal. Often they use the property for family stays and it is already fully furnished, equipped and stocked with expendables. In some cases they are purchased as fully furnished, equipped and stocked with expendables.
- Seasonal properties would naturally experience more unrented periods through the year as well as additional commissions. The nature of both Seasonal and Vacation rentals are similar in that respect. As an initial rental, if a seasonal rental unfolds, you have initial increased rent proceeds while still marketing for the next rental, seasonal or long-term.
- Sales and tourist tax total 11.0% and are not applicable if rental agreement/period is for 6 months plus 1 day. If you are renting for six months or less you are now a card carrying member of the “tax goon squad” just like me.
C. Multi-marketing approach:
- Using the November/December time frame for a reference, how would we suggest handling a property in this somewhat strenuous rental market? Offering a property simultaneously in more than one of the initial categories listed above in A. can increase the likelihood of obtaining a tenant. Whenever these options present themselves (time of year relevant), the prospect base can be increased considerably.
2. If you are a B. 2. option as above, you are solidly in the Seasonal or Vacation rental business.
3. For the rest of owners, the long-term scenario provides the more stable cash flow option with potentially the least variants.
D. Conclusion:
I left out the complications of actual property management challenges in an attempt to just introduce the basic issues surrounding marketing choices. This current rental market is both a market still in decline as well as a market with very limited qualified prospects. Don’t take on more than you are equipped to deal with. It would be fair to say that few people have the library of experience and knowledge that would accommodate their traversing the slippery slope of property management safely. There is another important and considerable library in the form of case law along with the very limited “Tenant Landlord Act’ that rules over residential rental interactions.
