Everyone is looking to save money these days. I want to share with you a recent money saving experience. Those that know me know I HATE to shop. Yes, that may sound strange being a woman and all but I really do hate it. I only shop when I absolutely have too.

Having said that, the copier in my office is an all-in-one machine. Works great and serves our needs. It prints black and white and does the job. Well, the feeder started jamming and our leases are 40 pages so it was really inconvenient to copy the lease page by page on the glass. My choice was to go out and get another one (I paid $250 and it lasted 2 years) or get serious and get a business copy machine with all the bells and whistles - color, networkable, scanning function is a must, duplex would be nice. So, over the labor day holiday I called a few local vendors to get both price to purchase versus price to lease. Well, I got bombarded by sales people wanting to sell me copy machines.

Now for those of you that do shop I am sure your first thought was to go to the internet but it took me awhile to think of this. After I saw the prices for new $8,000-10,000 and leasing for $200 per month. I decided to look on Craig’s list and I was able to find a copier from a company that went out of business and it did everything I wanted. I had to go get it which I did. I have to say I was so excited about my new machine. You’d think they were fine Italian shoes I was purchasing. I also got lots of toner but have to pay someone to hook it up to my server. I also discovered I have to purchase some supplies before I can use the printer. But, after all I only paid $300.00 for the machine. Yep, a 3 year old machine that was $10,000 new I paid $300 for and after all my other expenses I will probably be up to $1500 total.

This is really going to help me streamline my business and move me towards a more paperless office. I can now scan all docs to the server and email leases, contracts, invoices to owners or tenants alike not to mention I can look in the On Line File quicker and from anywhere instead of pulling out the physical file.

So, lesson learned. Never pay full price for anything & maybe shopping can be fun after all.

With rents declining 10-20% and everyone tightening their belts how does a Property Owner get their home rented without loss of income for 30-60 days?

First Impressions Count - Realtors know this. That is why they like to stage a home for sale.
Upon seeing the home for the first time it should be neat, clean, well manicured, and cute!

In most cases it is the woman who makes the decision about whether to rent a property or not. So, make it appealing. Put some nice flowers in front of the property, or in the kitchen. Make sure the paint job on the front of the house looks good - touch up if necessary. Lawn if there is one, should be green and mowed.

Windows clean, house clean on the inside, and walls painted or touched up. Prospective tenants will view the property as, What you See is What you Get.

Also, the place should be aired out and no funky smells. Carpets should be professionally cleaned, all faucets should sparkle and all lights should work - no dead bulbs.

It is better to wait until the house is clean and ready than to try to advertise it to rent when it isn’t ready.

These small things, that don’t cost much money will have an impact on the first impression.

A quick personal story. I bought my first home from my inlaws. It was Grandma’s house. Well, I had been to the house a million times and after a while you just don’t see things. When I got the appraisal back and saw the photos I was stunned. The place looked drab and the green house was one with the green lawn. I wanted to change the look of the house so the first impression would be - Cute to prospective tenants but I didn’t want to paint the house - it didn’t need it and I didn’t want the added expense. So I made a couple awnings over the front windows that were striped and incorporated the green but also had off white and burgundy stripes. Wow, what a difference and it didn’t cost much money.

So get creative. I have always been able to rent all the properties I manage within 60 days and most times within 30 days. If this is a home you live in and now want to rent try to look at the home with fresh eyes. Have someone come over and give you input on the property. Take photos so you can see yourself what is out of place. We often live with little things that a tenant would never live with (electrical coverplate missing or cracked), front door steps that are cracked or wiggle, etc. Prospective tenants will be paying good rent to you and they expect their home to be in working order, clean, and safe.

If you follow these simple tips and the property is priced competitively you will get it rented in a short amount of time.

When things don’t go the way I expect them I am a true believer in holding oneself accountable. I often ask myself, “what is the lesson I learned and how would I do it differently” I am also a positive person. Having said that I have been thinking a lot lately about the current economy and how it will change us.

Lessons Learned:

1. Priorities will get reset to what is really important in our lives - family, friends, nature - mostly free stuff
2. People will save more and think about how they spend their money
3. People will reevaluate what they Need vs.Want and hopefully this can be a teaching moment for kids
4. Instead of chasing the job, the promotions, why not chase the ball with the kids
5. Communities are developing, friendship, and support groups
6. The best things in life are free
7. Movie night with friends is more fun than at a theatre anyway

How does this impact Property Mgt ?

Well, I have had tenants come in and ask to downsize so they save money on rent. I have had owners (empty nesters) move into rentals and rent the big empty house. I know families are moving in together.

On Foreclosures, I still approve applicants. Afterall, they still need a place to rent. How I qualify them is if all credit is current except for the house it tells me they are responsible but had to make the difficult choice to let the house go. If all bills are delinquent then they aren’t approved.

I truly believe our nation will be better for having gone through this tough time. I believe there will be a renewed sense of community, helping one another, cherishing what we have versus what we don’t have and rebuilding our relationships which before got scheduled on the blackberry.

Taught a 1 day class this past weekend on how to be a good landlord.
Most attendees are either current property owners who rent their properties or people thinking about if they want to be a landlord. Most were concerned with legal issues, and how to screen for good tenants.

It was a great class and always reminds me of the basics that are so important.

What continued to be reitterated throughout the class was the importance of good communication between owner and tenant and how that can resolve most issues. Second, Owners needs to have Procedures in place and stick to them. They also need to have their support group already in place such as the plumber they want to use well before they get the call on Sunday night before a vacation that plumbing is backing up. You don’t want to have to go through the phone book trying to find someone that you don’t have a relationship with.

I think many in the class walked away with a wealth of knowledge and a really good binder full of materials that will form the foundation for their property management endeavors.

I was reminded of why I got into the property management business to begin with - I am really good at all the important things - excellent communication skills, policies and procedures, and exceptional business and accounting skills. I love what I do and I love sharing what I have learned to help those that are Do It Yourselfers do it better.

Heard about a great website I wanted to share with all of you.

www.giveanon.org

Autumn is here - my favorite season! With the change in color and weather property owners and tenants have some basic things to do to get ready for Winter.

1. Clean gutters and downspouts so when the rain comes they actually work
2. Make sure outdoor lights work - it is getting darker earlier
3. Make sure there are no hazards in the walk ways such as the cement rising - grind down or patch
4. Good time of year to have the chimney cleaned
5. Install new batteries in all smoke detectors
6. Turn on the heater to make sure it works. Put in a new filter if needed.
7. Bake some cookies so you can test your oven - no one will rescue your turkey on Turkey Day.
8. Caulk around windows and add weather stripping where necessary
9. If you have a sump pump now is the time to check it
10. Enjoy the Season

Dear Rental Owners,

Effective January 1, 2010 the CA-FTB in their effort to collect more money for the State has reinterpreted a law on the books that will affect Out-Of-State Property Owners. If you aren’t filing your income from rental property in CA with the State of California you will now need to report Quarterly 7% of the rent received.

Why do I care? Well, as a property management company the CA-FTB is looking to us to enforce this. We now have to withhold 7% of our Out-Of-State Owner’s rental income monthly and send it to the State quarterly or we could be fined.

There has been no education on how to do this, no info in the mail to us but the word is they will start enforcing this new interpretation of the law January 1, 2010.

So, those of you out of state owners please check with your accountant and go to the CA-Franchise Tax Board website to find out what you need to do to comply and not receive a penalty.

My understanding is you will file your taxes showing you reported the income and you will get the refund if you have already paid but like most of us that pay quarterly taxes the government wants their money now not at the end of the year after all write offs and expenses have been taken.

Seek counsel from your CPA.

I will be sending notices to all my out of state property owners asking them to sign a waiver that they already report their income to CA or I will have to start withholding the 7%. Unfortunately, this means I will also need to charge for this extra accounting and compliance with the state.

My suggestion if you are not inclined to pay more tax is to write your local CA politician and protest this interpretation of the law. This is what the professionals are doing but the more voices the better.

Kathleen
Broker/Owner

PS. check out our current listings of Santa Cruz Rentals.

Protecting our sensitive information is a constant battle. For industries that need to use your private information such as banks, mortgage companies, employers, and yes, property management companies effective November 1, 2009 the Federal Trade Commission (FTC) has a new law going into action.
1. Companies need to have in place their privacy protection procedures for the public.
2. We can no longer give credit reports to the applicant once run. We can only give them the name of the credit reporting agency so they can get their own credit report. The reasoning is what if you have info on your report that isn’t yours - we would be releasing someone elses info inadvertently.
3. We can no longer provide an Owner a copy of the rental application either since this has sensitive private info such as social security number, and credit account numbers.

In my office we have always had the info under lock and key but will not be blacking out sensitive numbers on credit reports, and applications before filing. Files are kept locked. And, we will no longer give out credit reports upon request.

I know this seems like one more level of bureaucracy but the intent is to protect sensitive personal information.

Kathleen
Broker/Owner

PS Check out our current listing of Santa Cruz Rentals.

I mostly manage residential properties but I have a handful of commercial properties and I have to say businesses are feeling the pressure of customers holding their money. Not to mention as a business owner myself I am always looking to save money.

So here are a few tips:
1. Eliminate advertising as much as possible.
2. Belong to community organizations and network
3. Pick up the phone and start making calls to clients - reconnect and build relationships
4. Make personal visits - again build relationships
5. If you belong to a business networking group take time to learn what other members do and try to help them get more business. If you aren’t in it to take people will start to refer business to you.
6. Experiment - don’t get gun shy. Here is an example of a wonderful experiment.

A plumber in town tried an experiment after we were discussing marketing in our local area. He decided to cut back on almost all his Yellow Pages advertising which at the time was $5000.00 per month! He is down to $500 per month and his business has increased 27%. He took the money savings and spent more time working on the company website. Spent time reconnecting with current and past customers. Offered special pricing for partner businesses such as my property management company. I can now say I use his services more because the price point is competitive with other vendors. They also offer outrageous customer service.

7. Trim hours, not staff. You still need to be productive and it costs more to find new people and train them. Also, when the economy turns around you will need your full time people. Lastly, it shows your employees that you do care about them and value what they contribute. It will build loyalty and the attitude we are all in this together.

8. Stretch your dollars. Review all your expenses and decide what can go, what can get cut back etc. One thing I have done is get my ink printer cartridges on line. I can get 4 for the price of 1 at Staples so that is a real savings to my bottom line. Also, print on the back of used paper for in office things. I also changed my phone voicemail with AT&T and went from $60 per month for my business voicemail box to $12 per box. I just had to call and ask. I don’t have all the bells and whistles but it suits my needs and I saved a lot on my monthly bill.

So bottom line get back to basics. Have a budget, review it, think outside the box for savings and get on the phone and start reconnecting with clients.

Kathleen Richards
Broker/Owner

Don’t forget to check out our Santa Cruz Rentals

Cell phone numbers go public on August 30, 2009.
To prevent unwanted telemarketing calls on your cell phone call the National Do Not Call List # 888-382-1222 from your cell phone.

Kathleen

PS Remember to look at our current Santa Cruz Rental List