UPM's The Smart Property Investor

Rental Property Investing from A Real Estate Broker Perspective

UPM Investor Blog — Wed, 16 May 2012 18:53:44 GMT

UPM Interview with Julie Geller, Broker/Owner of R. Peterson & Associates

Julie has been a realtor since 1999, recognized as a Top Producer & Honor Society by the NAR., and one of 2011 Idaho Business Review Women of the Year. She purchased R. Peterson & Associates from her father in 2007. Julie has worked with property investors for some time, particularly of late. So she has direct experience with how rental property investors think, along with the expertise to offer some sage advice.

As an experienced real estate broker, what are the seven key basic considerations for residential rental property investors to remember?

Location is always important in any purchase. Is it a desirable location that will be convenient for people going to work, the store, schools etc.?
Is the house structurally sound? Get a home inspection done to find out. A minor fixer upper is most cost efficient and quicker to get rented.
What are houses selling for in the neighborhood? Is this something you can sell, get out of, or make a profit if it had to be sold quickly?
Have enough money set aside for repairs, vacancies and unexpected events.
Get good insurance on the house after you purchase it.
Be careful of the real estate taxes and the homeowners exemption. It may have the homeowners exemption on the house when you purchase it, but it will come off the following year when it turns into an investment property. Plan appropriately for the higher taxes in the monthly payment.
Have a good accountant and attorney in place to help you make each decision and protect your investment.

What are three key investing mistakes to avoid?

Not having enough money to support the rental for repairs, vacancies, and unexpected events. You have to be willing to take a loss every now and then without it affecting your own financial needs. Do not purchase a rental if you are barely getting by at the moment.
When you write an offer on a property, know ahead of time if you are obtaining financing or paying cash. If you are paying cash, is the money coming out of savings, checking or an IRA? If it is an IRA, you need to pull the money out at least 2 weeks before closing. If you wait until the last minute and there is a delay, it could kill the transaction by not closing on time. Check ahead with your IRA and find out the amount of time and requirements it takes to access that money. Changing from a cash purchase to a financed purchase will cause some bank foreclosure properties to become null and void. Visit with a lender ahead of time and have a plan in place before you even begin to look at property.
Know how you are going to take title to the property ahead of time. Most bank foreclosures and short sales will not allow the property to be purchased in a Trust or LLC. Fannie Mae- and Freddie Mac-owned property, for instance, will not allow the purchaser name to be changed once the contract is accepted. Have all these details worked out with your attorney, accountant and Realtor before you begin to look at property. Once you have purchased the property, you can always quitclaim it into your trust.

Are there specific types of rental properties that best suit particular profiles of investors?

Yes, there are. For example, parents with kids headed to college may find it a good idea to purchase something close by the college ahead of time and then use it for the kids to live in while they go to school. There are a lot of new 4-plexes going up right now. They generally have a on-site property management team in place. If you want a place to park your money and let someone else handle all the details, this would be ideal. Check ahead to see what the community vacancy rate is and what the fees are for this service. Some of the contracts are lengthy. If in doubt, get your own attorney and accountant to review the contract. For those who have not had a rental before but want to try it, find a good Realtor and a Property Manager to help guide you through the process and what to expect.

Working with a knowledgeable Realtor will help investors determine which type of rental properties will best suit their goals and expectations, budget, resources, time frame, and management style.

What is your advice regarding short and long term goal setting for rental property investors?

A rental should be a long term investment. It is not a quick, easy return, it is a long term commitment.

Are there investing tools that you recommend to clients, i.e. checklist, ROI calculator, etc.?

A good accountant, an attorney, a Realtor, and a Property Manager

What are the advantages of teaming with a real estate broker to build a rental property portfolio?

A Real Estate Broker will know the area, prices and the trends of the area. A Property Manager will be valuable as you build the rental property portfolio and maintaining the value in the portfolio.

Overall Piece of Advice: I think building a team with attorney, accountant, Realtor and Property Manager are the keys to success if you are serious about getting into the rental investment market.

Our thanks to Julie Geller of R. Peterson & Associates for sharing her insights with all of us. If you are considering investing in, or looking to build your portfolio of Idaho rental properties, especially in Nampa, you can contact Julie at 208-989-1861 or julie@rpetersonrealtors.com.

New to UPM's Local Arts Program: Glenn Oakley, Photographer

UPM Investor Blog — Tue, 15 May 2012 17:43:28 GMT

Even though we already know that Idaho is home to a great number of talented artists, we are still taken by surprise when we come across someone who shines in their chosen media, who is able to capture and share something truly magical.

Glenn Oakley is one such person. His landscape portraitures are breathtaking. So we are delighted to share Glenn's UPM web page with you.

New to UPM's Local Merchant's Program: Black Smith Signs

UPM Investor Blog — Mon, 30 Apr 2012 16:44:41 GMT

UPM is delighted to showcase Black Smith Signs through its Local Merchants Program. They service Treasure Valley from Nampa, providing customers with competitive pricing, fast turnaround, creativity, and follow through. The staff is friendly and very helpful. We invite you to check out the Black Smith Signs web page on UPM's website.

To Be or Not to Be an Entrepreneur

UPM Investor Blog — Sun, 22 Apr 2012 00:15:19 GMT

The long-term success of a business is contingent upon a number of factors. Beyond the basics of a viable business model, operational and marketing savvy, the ability to navigate change, and an enduring customer base, there are other influences which play part. The economy, whether it be local, national, or global, is one such influence. The health of other businesses also contributes to a company’s vitality.

At UPM, we wholeheartedly believe the success of other businesses in turn feeds our own. We support local businesses in a number of ways, including through our Local Merchants Program. Because we are such strong proponents of mutually beneficial fortune, we encourage well-planned entrepreneurship.

UPM's 5 Key Considerations for Aspiring Entrepreneurs

Be brutally honest with yourself.

Are you really an entrepreneur? Are you a calculated risk taker? Are you willing to learn new skills to grow and support a new business? Do you have the means to self-sustain a business for at least 2 – 3 years?

Do your research.

Conventional wisdom is “do what you love.” That’s fine in concept, but reality dictates you research what the market is for a business built around your passion.
What is the total universe of potential business in your identified market? Is there competition? If so, how many competitors are there? How many are local to you? What is their market share (in other words, is there enough of the market pie for your business? How will you differentiate your business from theirs?

Be practical.

Will your business idea require infrastructure? For example, if you are considering launching a business with a storefront, do you plan to rent or buy space? How much space will your business require? Whether you plan to rent or buy, determine how much you will have to spend monthly on that space and other related costs you need to calculate into monthly expenses, as you need to be informed as to the amount of cash flow your business will require.
You must learn to manage your “passion for profit” as a business. You’ll need to accept you’ll be doing things you may well not enjoy or feel comfortable with, like bookkeeping and accounting, inventory management, sales.
Consider building your business in a scaled fashion. If you can launch your business from home before you commit to additional space, it may more prudent to do so.
Non-inventory based businesses are far easier and far less costly to launch and support. So if you do not have access to initial funding or have not saved toward launching a business, it’s best to pursue an idea that complements your financial profile.
If you need to acquire funding to launch the business, consider the consequences of pursuing third-party financing. We see standard advice having you consider loans from family and/or friends. However, there is a considerable downside to doing so. Just as banks, VCs, or Angel financing means you relinquish a percentage of control over your company, the same holds with family and friends. Moreover, you risk the additional impact of damaged relations and emotional turmoil.

Write a plan.

A business plan doesn’t have to be long and fancy, but having your vision, strategy, and logistics down in writing a) makes the business real, b) gives it structure and discipline, c) is a very useful tool for monitoring progress.
Once you write the plan, revisit it on a regular basis; amend it as needed. At a minimum review on an annual basis, quarterly checks can be very productive. These reviews show you where your business has been and where it is going. Be open to making directional changes when opportunities arise or if something isn’t working. In other words, your business plan should be a living document, a road map to your success.

Make profit margin your goal.

Revenue and cash flow are the lifeline of a business, but profit margin is the true measure of success. Unnecessary, redundant, or hidden overhead; convoluted operations and/or pricing structures, especially coupled with limited resources/personnel; under- or non-performing, expensive, or superfluous service or product offerings---all these impact your bottom line.
Streamline as mantra. Streamlining your operations should be a continual pursuit, from capital investments to monthly expenses to processes and policies. Regular and rigorous scrutiny of all aspects of your operations is indispensable to achieving maximum profit.

Interesting Data Points on Entrepreneurs and Small Businesses

"Entrepreneurship growth was highest among 45- to 54-year-olds, rising from 0.35 percent in 2010 to 0.37 percent in 2011. The youngest group (ages 20 to 34) also showed a slight increase. In contrast, the 35- to 44-year-old and 55- to 64-year-old groups experienced declines in entrepreneurial activity rates from 2010 to 2011."

"Entrepreneurial activity rates reflect changing demographics," said Robert W. Fairlie, the study's author and director of the master's program in applied economics and finance at the University of California, Santa Cruz. "Despite a slight decline in entrepreneurial activity rates this year, the share of new 55- to 64-year-old entrepreneurs has risen from 14.3 percent in 1996 to 20.9 percent in 2011 due to an aging U.S. population." (Entrepreneurship is Alive and Well, So Where are the Jobs?, Ned Smith, senior writer at Business News Daily)

From cnnmoney.com / May 2012:

34% of new businesses survive more than a decade
10% of startup companies don't need any outside financing
47.5% of small business loans were approved by small banks, while only 11.7% were approved by large ones
$80K is the average annual capital needed by startups
49.3% of all U.S. workers are employed by small businesses

UPM's Local Arts Program: New Artist to Share

UPM Investor Blog — Mon, 23 Jan 2012 23:54:38 GMT

In our continuing efforts to support the local arts, UPM is proud to introduce painter Greta Redzko. You can view her UPM web page, which includes a link to her Facebook page.

Introducing New UPM Website and Blog Design

UPM Investor Blog — Fri, 18 Mar 2011 06:18:00 GMT

A New Lease on Rental Lifestyles™

From its inception, Ultimate Property Management, LLC has been about delivering on promises: Quantifiable and highly-affordable ROI for owners/investors; comfortable rental homes and timely response to requests for renters; being accessible and following through.

We're very pleased to introduce our new website and blog design, which better reflects UPM's professionalism and and its tagline "A New Lease on Rental Lifestyles™." It's our goal to make all visitors feel welcome while providing everyone quick access to the information they seek. We also continue our efforts to support Idaho with our complimentary Local Arts and Merchants Programs.

The the image above was chosen as the key visual for the redesign to represent:

Welcoming atmosphere
Fresh beginnings
Streamlined operations
Clear communications

Going forward and as you revisit our website, you'll notice additional improvements and new content. So come by any time to learn what else we have in store for you.

Best wishes from all of us at Ultimate Property Management, LLC

Best Rule of Thumb for Managing Rental Property Mortgage Payments

UPM Investor Blog — Wed, 21 Jul 2010 16:51:00 GMT

UPM QUICK REFERENCE TIP: Best rule of thumb for managing your rental property mortgage payments is to build up a buffer reserve fund of at least one month's mortgage payment amount, ideally two to three months' worth.

Maintaining a buffer reserve fund reduces if not eliminates stress related to meeting monthly mortgage payments.
- You will be able to make monthly payments early, regardless of timing of rent payments received.
- You will reduce if not eliminate related late payment fees and penalties.
- With at least two months' worth of reserve you reduce stress related to addressing larger unforeseen repair costs or short-term vacancies.
How long it takes to build the reserve fund depends upon the amount of your mortgage payment(s) and what other income you possess outside of rents.
- If you are working with a property manager, you have the option of applying/stockpiling all of a portion of your monthly owner residual for this purpose.

What Investors Need to Know about Home Owners Associations and HOA Management Teams

UPM Investor Blog — Fri, 18 Jun 2010 20:14:00 GMT

When it comes to making choices about residential property investments, it is wise to have knowledge of any Home Owner Association (HOA) and HOA management teams before you decide to invest in a particular subdivision. You should have all the related facts at your disposal before you make your final purchase decision--because even when you are only buying property for investment purposes, you can wind up dealing with HOA-related headaches. Yes, this takes some research effort, but you don't want to find yourself without redress to issues that can arise.

HOA CONSIDERATIONS REFERENCE

Ask for a copy of the CC&Rs and review them before you decide to purchase a property; make it a stipulation for making a purchase.

Are the CC&Rs clear, logical, and manageable? Are there any obtuse or unreasonable rules and regulations? Is there too much room for interpretation? Do the CC&Rs allow or circumvent self-appointed vigilance committees?

Learn about the HOA board.

Are they accessible or a stealth organization?
Interview the board. Find out if their collective HOA philosophy meshes with yours.
1. Does the board represent the owners and act in their collective best interest (including financial) or does the board demonstrate it operates on behalf of a select core group?
2. Does the board have a track record of penalizing rental properties more often than other home owners?
3. Are owners included in the decision making with HOA fee increases?
Find out how often board meetings are held, when, how the board alerts owners to the meetings, if/when meeting minutes are distributed and with what regularity. Regarding the latter, have the board provide proof of said distribution.
Ask for the names and contact information of a few owners outside of the board and interview them about the board.

Ask if there is a HOA management firm in place and if so, get the company contact information and key point-of-contact name.

Conduct interviews and determine if the firm provides quantifiable ROI for their fees.
1. Do they recognize owners as their customers and appreciate who pays their fees, or do they answer only to the board?
2. Do they/are they able to field more complex concerns like inter-owner issues like property damage and fencing conflicts, or do they simply issue written warnings and fee violation notices about lawn or lighting infractions?
3. Do they field landscape maintenance requests in a timely manner or require additional contact?
4. If you only receive contact information for a management team and not an HOA board, make sure there actually is an HOA board to which the management ream reports.
Find out generally how often HOA fee increases occur and ask for proof that the increases are approved by/substantiated by the HOA board.

WHY YOU NEED TO KNOW

You could wind up paying higher and higher HOA fees with no recourse, no substantiation of the increases. If you are an out-of-state investor you could have little to no leverage to have your concerns addressed, little if any visibility to the legitimacy of violation claims. If an HOA is not rental property-friendly or has a track record of penalizing rental properties more often than others, you stand to alienate and lose good renters, which in turn adversely impacts your revenue stream.

The Glamorous Life of a Property Manager

UPM Investor Blog — Tue, 25 May 2010 14:10:00 GMT

Contrary to what you may believe, property management is not all glamour, fame, globetrotting, and fine cars. While travel is definitely part of the package, one doesn't normally hop a lear jet to fly to exotic destinations. Dining out is more about catching fast food on the fly than a three-hour gastronomic extravaganza at a five-star restaurant. Instead of having an iPhone filled with celebrity names and numbers, those of repair and maintenance vendors predominate.

We know. You're shocked to learn the truth. You're shocked to learn that property management is not a career that everyone aspires to. Property managers tend to exist under the radar, like most entertainment agents.

Probably no one cliche/catch phrase sums up what property management is really about than "the devil is in the details." This business revolves around details. It absolutely demands strong organizational skills. The ability to problem solve, to think fast on one's feet is called upon daily. Verbal grace, if not an imperative, is certainly a key to ongoing success. Tireless follow through/follow up is the glue that binds it all together.

So why do it? What drives some to pursue a career or business in property management, if it isn't the glitz and high profile thrill of a Hollywood-like lifestyle? Perhaps it's making things happen behind the scene that some relish. Others may enjoy meeting the variety of challenges that can arise. Still others glory in the ability to wrangle seemingly countless details into a cohesive whole. Working daily with numbers and/or people can be a driving force. Winning new business and establishing long term relationships with investors and owners is a very compelling pursuit.

Whatever the reasons or combination thereof that drives property managers to do what they do, the best ones demonstrate a passion for it. They appreciate what it really takes to do it well. They make things happen. A resulting prosperous and growing business with a great reputation makes it all very worthwhile.

Evaluating Property Management Claims, Part III

UPM Investor Blog — Mon, 03 May 2010 22:39:00 GMT

Welcome to Take III of UPM's series on evaluating property management claims. As we've mentioned before, there's been a real rash of direct mail (mind you, not digital marketing) firms are sending.

Direct mail can be expensive. Canvasing blindly is even more so. Without follow up, like phone calls, these mailings will produce little in the way of sales. Such expenditure impacts the bottom line. Meanwhile, we see more PM firms scouting around for new business, at lower and lower rates while touting more and more services.

This begs a couple of related questions. First, if these companies are so good, reliable, and cost-efficient why are they resorting to direct mail to pursue new business? Don't they have a wide network and strong word-of-mouth reputations? Secondly, even if they can actually deliver a high level of service at increasingly lower rates...can they/will they sustain them?

We see a great deal of promises made for even 7 percent or less for management fees--including from firms from which some of our clients departed. If, as the direct mail would indicate, these companies' client base isn't already large enough to offset very low rates, how long will it take them to build it?

Of the possibly many services and types of data access marketed, how many do you really get for say that 7 percent? How many of these attractive features are extra? 24/7 online access to data, online payments, etc., all cost management firms money to run/offer. So do extra or different types of reports. If such expenses are not offset with property management fees, how are they financed?

Two outcomes of very low rates versus high services/costs, and certainly without high volume business, are possible if not probable. One is these firms will be unable to sustain them both without risking stability. Two, these firms find ways to subsidize their level of services through fees other than the monthly management versions.

For investors like you, the question comes back to what you will really receive from any firm. Claims are just that. Quantifiable and consistent service, proven return for the fees charged is always a great place to start when evaluating assertions that come your way. Determining any hidden costs is another.

An absolutely essential attribute of a reliable and successful management firm is follow through. Do these firms canvasing for new business return calls from owners, renters? Do they respond quickly and cost-effectively to repair requests? Can they sign on new tenants in a timely manner? All the bells and whistles won't matter without follow through.

Evaluating Property Management Company Claims, Part II

UPM Investor Blog — Wed, 21 Apr 2010 13:29:00 GMT

As promised from a prior blog entry, here is installment part II of our series on evaluating property management claims.

MORE HEADCOUNT VERSUS PRODUCTIVITY AND COST

The most recent marketing claim we've seen is a comparison of "most companies" having a 2/100 ratio of headcount to units served. This particular company claims they have a 5/100 ratio and that this means quicker response to client needs.

Sound good to you as an investor/owner?

Perhaps, but what does it really mean? Are you getting higher quality service? Are your properties being rented more quickly and repair and maintenance issues addressed more efficiently and related costs reduced? Below are some questions that come to mind when evaluating the real value or cost behind additional headcount.

More headcount = additional overhead cost?

· How many people are full time? Part time? Freelance?

o The answer to these questions tells you what overhead the firm may be incurring and how much that may impact costs and to what degree to you.

· Are all these people centrally located?

o Again the answer to this question gives you an idea of the overhead cost and how that translates to fees for you.

· How many are onsite resident managers? Is there a rotation schedule in the mix?

· What type of properties is the firm handling with this increased headcount? Large complexes? Small complexes? Single-family houses? Is it a mix and if so, how is it divided up?

· Who manages the personnel? Is this in turn additional headcount, and at what cost?

More headcount = higher productivity?

· Does increased headcount automatically translate into higher productivity?

o Are all these people busy 100 percent of the time?

o Are they well trained, organized, good at reporting and follow through? What is the personnel turnover rate?

o Is the firm able to quantify/provide proof that additional headcount adds value by a) filling vacancies faster, by x amount of time, b) reducing marketing and repair/maintenance costs by x amount, and c)adding additional value to investors/owners in very specifically identified means?

o Is the firm able to articulate the value generally and specifically to owners with quantifiable data? Are they able to demonstrate a reasonable trade-off between the increased headcount versus overhead? Does it really take more headcount to better manage 100 units? Does the firm have standardized processes and policies in place to streamline operations and headcount productivity? Are these closely managed?

o Would reliable software solutions make more sense than adding headcount? If not, why not? If part of the rationale for more headcount is higher frequency of property inspections, are these additional inspections necessary? What is the trade-off in terms of cost?

There are more questions that could be asked, but these are a good place to start. As with any other decision making process, gathering and then interpreting data and information is a wise investment of time and energy.

What's the Future of Coffee Houses in Treasure Valley?

UPM Investor Blog — Sun, 28 Mar 2010 13:29:00 GMT

It's Sunday morning and time for that mug of aromatic and deeply satisfying caramel macchiatto. Perhaps a pastry or two. It's time for some atmospheric socializing. There's only one problem. The options for local coffee houses has dwindled considerably. Two normal haunts have disappeared, while the third's quality of hot drinks and pastries has dropped precipitously. When did they begin substituting syrup for caramel sauce (and like we wouldn't notice)?

Is this situation simply a sign of economic times or is there more to it? Has the idea of the coffee house run its course for now? In either case, where will we buy boutique bags of coffee for our homes? Etsy? Where will we informally gather together in the future?

Coffee houses or cafes have played a integral role in many people's lives for some time now. Individuals pop in for their favorite brew on the way to work. Friends gather to catch up on each other's lives. Groups hold regular member meetings. Sales people meet with prospects. Musicians and visual artists gain visibility and a local following.

So where do we all go from here? It's a question we wish we could answer. Can you?

Evaluating Property Management Company Claims, Part I

UPM Investor Blog — Fri, 26 Mar 2010 16:11:00 GMT

We've been seeing an up tick in direct marketing for property management companies recently and it is interesting to read the claims made. As real estate property investors we know you take it all in with a grain of salt. That said, it got us thinking about such claims and what investors think when they see them.

Each property management firm will have its own unique mix of attributes, personality, skills sets, technology, and resources. It is the specific mix of company traits that investors consider before making a decision about which company will best suit their needs. We'd be highly interested to learn your thoughts on claims made and how they do or don't affect your decision making process.

Over the course of the next few blog entries we will address a few of the claims UPM has seen and the questions we ourselves have about them, how they relate to us.

GREEN/ECO-FRIENDLY CLAIMS
We just read a claim by one company that they are 99% paper free/green, with electronic everything including digital leases. Sounds fantastic, yes?  But with regard to the leases, what is the back up plan for any unforeseen loss of data, for the leases and across all other related information and documentation? Lack of a back up plan and processes can severely affect a completely digitally-based company's ability to operate at all, let alone efficiently.

Another related question is, do tenants not receive printed leases for their files?  How many property management firms can assume tenants will have access to computers for archival and communications purposes? The percentage in California and New York is probably high, but is it so in other states like Idaho?

Also, does this green figure take into account any printed property flyers? Does this company not use them at all? If not, does the practice help or hinder acquiring prospective renters? Does this figure take into account the printed brochures the company mailed out to make their claim they are 99% paper free...on new versus recycled paper, perhaps without using eco-friendly ink, and using paper envelopes and postage stamps?  Wouldn't the company have made their case better via email promotions and web advertising?

What we at UPM do is incorporate printed materials very judiciously. Outside of our business cards, we have no physical UPM self-promotion materials. We do print property flyers, but in small numbers and based upon the demographics of the specific area. We always utilize web-based advertising, but know that lawn signs are highly effective and flyers are necessary in a number of cases. We know that when renters are conducting a search for their next home they may see a lot of properties and so having flyers in hand helps remind them which they preferred and related property information. When affordable recycled paper resources are available, UPM chooses those options for its printing needs.

Streamlining operations is smart and greener business, and technology can definitely make a big contribution to it. In this case, intelligent decisions about when and how to apply it counts. UPM uses technology like most other firms. As we replace or add equipment we buy more energy-efficient models. When it comes to software solutions, we seek affordable solutions that don't come with application overkill or require huge investments that in turn affect our pricing. We use mobile solutions. When deciding which documentation to digitize, we consider a number of factors before moving forward. UPM incorporates data back up technology and processes, and other means to assure our operations continue as normally as possible at all times.

The bottom line to being a green and eco-friendly operation is planning and smart implementation. We don't claim to be expert or thoroughly green as yet. We do promise intelligent decisions about evolving our company as quickly as possible.

NEXT UP ON THE UPM'S THE SMART PROPERTY INVESTOR
Part II: Headcount Versus Productivity and Cost

Important Tips on Buying and Managing Residential Income Property

UPM Investor Blog — Tue, 02 Mar 2010 16:26:00 GMT

Income property investments are not about simple arithmetic. Owners need to understand not only the tax benefits and implications; they need to identify a realistic timeline for establishing a revenue stream. In fact, forethought and planning are essential to short- and long-term success with such investments. Below are some key considerations every investor should contemplate with regard to their income property purchases.

Here are UPM's Tips on Buying and Managing Residential Income Property

Buying Rental Property
1. Location and Features
  1. Where a rental property is located and its demographics will influence rent levels and renter interest, number of competitive properties.
  2. You need to consider features that will attract renters in a given location.
    1. Number of bedrooms and baths
    2. Yards, particularly fenced backyards
    3. Garage and/or other parking
    4. Proximity to shopping, freeways, schools, etc.
    5. A/C and heating (aka central or other)
    6. Unique features that can be leveraged vis-a-vis competitive rentals
  3. You need to consider some basics related to multiple unit properties
    1. Who's responsible for utilities like trash?
      1. Will you need to purchase a trash bin? Centralized recycling center?
    2. How is parking to be managed?
    3. Who will manage/pay for maintenance of common areas/landscaping and lawncare?
    4. Is there a Home Owners Association?
      1. You need to know the related costs.
      2. If so, you need to acquire a copy of the CC&Rs to understand the parameters of that responsibility.
2. While a prospective property may look like a great deal on the surface (i.e. foreclosed properties), you need to conduct an in-depth inspection in order to assess if it will require an additional investment in repair/replacements in order make it move-in ready.
Managing Rental Property
1. In contemplating how much involvement you want to have in the management aspect of income property ownership, consider the following:
  1. In the event you hire a third-party to manage your asset(s), and assuming they are responsible, you are wise to remain anonymous to renters.
    1. If you make a unilateral decision to advertise your rentals because you believe you have more flexibility with regard to background checks, including credit rating, consider the following:
      1. You may be sending mixed messages about your property and its management.
      2. You could live to regret accepting renters that don't meet certain minimum requirements.
      3. Once renters have your name and contact information, believe us they will use it. When property issues arise, the tenants will call you. Are you prepared to take 4 am emergency phone calls?
2. Rental Property Appliances
  1. Buying used major appliances has an appeal to many income property owners, but this approach has potential flaws. You need to consider how much your time is worth relative to such logistical requirements.
    1. It takes time to peruse sites like craigslist to find what you're looking for.
      1. Contrast this to buying new from reputable and competitively priced retailers.
    2. You will likely be responsible for pick up, delivery, and installation of the appliances.
      1. Most retailers offer free delivery and even pick up of your broken appliance.
    3. Used appliances normally don't come with a warranty and you may find yourself replacing something sooner than later and starting the cycle again.
      1. New products come with a warranty, so in the event there is a problem with an appliance, you can have the repair or replacement handled by the store, thereby saving you the time and energy it would have cost if you had to address it yourself.
        
        We had one client who had to replace a refrigerator bought online in less than a month. They thereafter had a new version delivered and two years later the unit is running perfectly. Had the owner gone with a new one in the first place they would have saved the cost of the used unit as well as the time invested in finding it and then ultimately removing it.

The single most important recommendation UPM can make to owners/investors of income property is to do your homework. Learn all that you can about the location of a target property. Learn all you can about the property itself. Understand your limits with regard to prepping the rental and maintaining it. Plan forward for expected expenses.

Find more information and related PDF files on our website at http://upm-idaho.com/Investors.html

Featured Artist on UPM Website: Linda Lantzy, Photographer

UPM Investor Blog — Fri, 29 Jan 2010 18:33:00 GMT

Since its introduction over two years ago, UPM's Local Artists Program has been honored to profile a number of gifted Idaho-based artists. Linda Lantzy is no exception. Her vision and ability to capture the magic of Idaho scenery is extraordinary and ethereal. Her work can be found gracing offices, homes, and galleries. We encourage you to visit her UPM web page and her own website to learn more about her and her art.

Link to Featured Artist Linda Lantzy on UPM Website

General Investing Website/Social Networking Hybrid

UPM Investor Blog — Thu, 22 Oct 2009 19:00:00 GMT

Here is a site you may be interested in checking out. You can personalize your profile as well as your tracking interests. You can also create and maintain a related social network. The site is well designed and offers lots of visual cues for quick reference.

http://www.tracked.com/

Let us know what you think.

Regards,

Your Ultimate Property Management, LLC team

Call for Artists to be Showcased in UPM's Local Artists Program

UPM Investor Blog — Thu, 24 Sep 2009 16:47:00 GMT

For over two years now, UPM has sponsored a Local Arts Program by featuring a range of art and its creators on our website. We are once again reaching out to the community to help us identify new talent for inclusion in the program. So far we have been honored to display photography, paintings, murals, sculpture, and glass art. We welcome inquiries from art schools or art departments that would like to have us create galleries of student art work as well.

Here is a link to the introductory web page with program details and related links: http://upm-idaho.com/Local_Arts_Program.html

If you have a favorite artisan you'd like us to know about, please contact us either at 208 461 0503 or you can use our online contact form at http://upm-idaho.com/Contact.html and we'll be delighted to contact you or them.

We thank you in advance for helping us put the spotlight on creative talent that resides right here in Idaho.

Have a great day,

Your UPM team

Another Reason to Buy Rental Property in Idaho: Great Utility Companies Customer Service

UPM Investor Blog — Sat, 19 Sep 2009 00:41:00 GMT

QUICK FRIDAY AFTERNOON BLOG ENTRY

Happy Friday from UPM and we wish you a fine weekend. It's still in the 80's here and glorious, BTW.

We thought you should know that among the many reasons to invest in Idaho and rental property here is our local utility companies and the great customer service they provide. UPM has always experienced consistently wonderful service from these people across the board. So our many thanks to them and know that utilities needs for your properties will be handled both quickly and deftly.

Enjoy the weekend.

UPM

Our Thanks to These Real Estate Professionals

UPM Investor Blog — Thu, 03 Sep 2009 20:33:00 GMT

This week UPM would like to take the opportunity to thank these local professionals for their help:

Stacy at Hubble Homes
Breezi at Fidelity Title
Carmen at Alden Holm & Company

Early this week UPM received a call from an East Coast investor trying to locate the HOA management team for a set of properties in a specific subdivision. It was due to Stacy, Breezi, and Carmen that we were able to connect the investor with the proper HOA team. We wholeheartedly thank them for their kindness and help. We salute their professionalism and generosity.

For you real estate investors, know that you will be in good hands with any of these firms and in particular these individuals.

Regards to all,

The UPM Team

Ultimate Property Management, LLC (UPM) Opens New Offices

UPM Investor Blog — Thu, 27 Aug 2009 17:41:00 GMT

DATELINE: August 27, 2009

Your team at UPM is delighted to announce that its new suite of offices opened to the public on August 1, 2009. Located across from the Nampa Civic Center, our location allows easy access for investors/owners and renters alike. Below is our new contact information:

ADDRESS
Ultimate Property Management, LLC
311 2nd Avenue South
Nampa, Idaho 83651

CONTACT INFORMATION
Phone: 208 461 0503
Fax: 208 461 4707
Email: upm.idaho@yahoo.com

OFFICE HOURS
Monday - Friday 10:00 AM - 4:00 PM

Let us know how we may be of assistance to you and feel free to stop by when you're in the neighborhood.

Best regards,

Team UPM