Five Keys to Tenant Screening Success!

Tenant Screening: Five Keys              
By Tracey March (All Property Management)

 If you want to minimize the risk in your property investment business, you should understand that a key to your success isn’t just buying the right investment property–it’s finding the right property management–whether that’s you, or someone you hire. And a critical component of property management is finding the right tenant for your real estate investment property, which means tenant screening should be at the top of your priority list. Here are five things you can do to ensure that your tenant screening process helps you identify the best tenants and weed out the bad ones.

Five Keys To Successful Tenant Screening

1. Let applicants know that tenant screening is mandatory. Just hearing the words “screening process” will make some potentially bad renters self-filter and save you time.
 2. Use your tenant screening process consistently. A systematic and comprehensive screening process that you apply objectively to every applicant will protect you if someone claims you violated the Fair Housing Act. It will also help you to screen out bad renters.
3. Decide what your minimum qualifications will be, and stick to them. Will you have income requirements so you have some assurance that your tenants can make their rental payments? Will you accept tenants with criminal records? What if they haven’t had any arrests for more than ten years and a steady job? Think about these issues, make a decision, and apply them consistently.
4. Run a credit check. Credit checks are critical. You can find out applicants’ debt-to-income ratios and whether they pay their bills on time. Learn how to read a credit report. And never accept a credit report that a potential renter brings to you; get them directly from a credit reporting company.
 5. Check references. Always call present and past landlords. A present landlord may give a good reference to get rid of a bad tenant; a past landlord may be more forthcoming. Ask about evictions, complaints from other tenants, pets, major maintenance issues, if rent was paid on time, and if the landlord would rent to the tenant again. Also consider getting and checking employment and personal references. If you don’t have the time or the desire to do tenant screening, don’t cut corners–consider hiring a property manager to help you.

Freedom Property Management has partnered with leading edge software for managing your properties efficiently and cost-effectively, as well as running tenant screenings and credit checks.

Please contact us with any further questions @ 949 584 5712

Article: Top 7 Real Estate Market Trends to Expect 2014

1.   Price gains will moderate - Orange County home prices shot up over 22% in 2013.  Local economists and experts forecast home prices to stabilize in 2014 with lower price gains. Cal State Fullerton economists say that price appreciation will be in the range of 5 to 7 percent this year.
2.  Increased inventory of homes for sale - More homeowners will list their homes for sale this year.  The number of homes on the market was extremely low in early 2013 and then doubled by November while climbing to more than 6,000 actives.  Local experts expect this trend of more homes for sale to continue.
3.  Improving economy will create more buyers - Cal State Fullerton and Chapman economists predict that Orange County employment will increase by 35,000 jobs this year.  This trend together with other factors will result in increased demand for housing. 
4.  New home sales will increase - Orange County new home building was way up last year 2013 and is now back at pre-recession levels.  The number of new homes to be built and sold is expected to go much higher this year in 2014.  
5.  Mortgage rates to rise - Rates for 30-year, fixed mortgages, are likely to go up this year and average somewhere in the 4.9 percent to 5.3 percent range, some experts say.  That's still historically low and amazingly good for buyers.  However, rates will be higher than during the past 2.5 years.
6.  Getting home loans might be more challenging - Tougher U.S. government lending standards go into effect today on January 10, 2014, and will apply to loans that institutions plan to sell to Fannie Mae and Freddie Mac and on the “secondary” market.
7.  Apartment rents continue rising - Rents have been going up at Orange County for the past three years, and experts predict this will continue.  When apartment rents go up, people who want to own their homes and are qualified to purchase will see advantages of home buying.

We look forward to a bright 2014 for Orange County real estate markets with continued movement toward more normal, positive conditions. 

10 Reason to Hire a Property Manager! This article will give you fantastic insite on what we do!

10 Reasons to Hire a Property Manager

 

If you've owned income property for any length of time, you know that managing a rental can be financially rewarding. At the same time, you've also likely discovered that property management requires a large commitment of time and effort.
While it may make sense to take the do-it-yourself approach if you're a handy person, live close to your property, and don't mind devoting several hours per month to the task, in many cases this just isn't practical---especially if you hope to expand your business. With this in mind, here are some critical tasks a property manager can help you with:

1. Setting the right rental rates: While looking through the classifieds to see what other landlords are charging for similar properties is a fine way to ballpark your rent price, a good property management company will conduct a thorough market study in order to set a rental price for your property, ensuring that you achieve the perfect balance between maximizing monthly income and maintaining a low vacancy rate.


2. Collecting and depositing monthly rent payments on time: If you've ever worked in a billing department, you know that securing payment from clients can be difficult, not to mention awkward. Property management companies have efficient, tried-and-true systems in place to effectively collect rent and maintain on-time payments. You'll find this particularly important if you have a limited number of properties, and collecting payments on time is crucial to maintaining your cash flow.


3. Marketing and advertising your property: Through long experience, a property manager will know exactly where to market your property and how to craft compelling advertising materials---a significant advantage when it comes to filling your properties quickly and avoiding long vacancies.


4. Finding the right tenants: Experienced property managers are experts at finding good tenants, and will take care of all the details, including the securing all criminal background and security checks, running credit reports, verifying employment, and collecting previous landlord references.


5. Managing tenants: In addition to finding good tenants, a property management company will manage all aspects of the tenant-landlord relationship. The property manager will handle both routine and emergency maintenance, take care of routine inspections, and manage any situations where conflict resolution is required.


6. Managing vendor relationships: Property management companies have relationships with maintenance workers, tradesmen, contractors, suppliers, and vendors that it's almost impossible for an independent landlord to duplicate. Not only will your property manager get you the best work for the best price, they'll oversee any necessary maintenance projects.


7. Ensuring that you're in compliance with housing regulations and property laws: There is a multitude of applicable laws and regulations to abide by when renting and maintaining your rental property. These include local, state and federal regulations, as well as fair housing regulations (such as the ADA). A property manager can help you avoid lawsuits by keeping your property up-to-date and in compliance with these regulations.


8. Enabling you to invest in geographically distant properties: If you manage your own properties, you're pretty much limited to investment opportunities within a tight radius of your own home. By hiring a property manager, you can take advantage of investment deals in any location you wish.


9. Maximizing the profitability of your time: By having a property manager take care of the day-to-day aspects of running your income property, your free to spend your time identifying further investment opportunities or otherwise furthering your career.


10. Maximizing the profitability of your money: Most property managers charge a percentage of your property's monthly rental rate in exchange for their services. The rate typically runs anywhere from 6-10%, which is generally less than the money you save by hiring a professional to take care of your property.

Dont forget to visit our Youtube page for your viewing of FOR SALE & FOR RENT properties!

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Why to hire a property management professional. Read this ARTICLE

PROPERTY MANAGEMENT IN THE OC!

Why You Should Hire One

Owning a rental real estate property can be fun and very profitable, but it is surely a lot of work and many a time landlords find it to be very troublesome and exhausting. If you are one of those landlords in Orange County who do not want to take on the headache of managing a rental house/building then it is best to pass on the duty to an Orange County property management company or professional. It is definitely worthwhile to hire external help, even if it means you have to sacrifice some money in the process since it would serve as the property manager’s fees.
There are many benefits that urge or tempt people into hiring a property management professional for themselves in Orange County. The first and biggest advantage is that they would take care of the troublesome task of finding tenants for your rental property. Now, not all landlords are skilled in marketing, placing ads or screening calls from potential tenants, therefore if you are one of them then why should you suffer a loss while other smooth-operating landlord does a great job at marketing and earns plenty in terms of profit? After all, you can still have your unit booked with tenants and draw a decent amount of cash from it every month by allowing the professional to take care of things from you.
The second most popular reason as to why people hire property management companies or executives is to take care of things for them and to act as their liaison. In case of the real estate industry, nothing can be more important than networking or building great relationships with customers. After all, real estate is definitely a huge responsibility and a huge investment too, therefore people would like to invest in rental properties or any other property for that matter only if they have good relationship with the landlord or if they trust the landlord. In today’s modern and hectic lifestyle, people hardly have time to maintain cordial or warm relationships with their tenants and this is where an Orange County property management company comes into the picture. The company or the professional would step in and fill the role of a warm and approachable landlord on behalf of the actual landlord.

Finances and real estate sort of go hand in hand, particularly those who are renting a building or an apartment. A property management company is the best solution because it will take care of your property, collect rents from tenants, levy discounts, levy penalties, make deposits on your behalf, etc. Moreover, if you have decided to get a property management company then you have to be sure that you are picking an experienced company.
The reason why it is important to have a property management company is that they have the expertise and they are also aware of the local laws therefore it is good to have such a knowledgeable person on board. Now, not only are property management professionals knowledgeable but they are also well-connected, so you can take advantage of his/her network of people.

What will my property manager do, and how can they help me ?

Management companies deal directly with prospects and tenants, saving you time and worry over marketing your rentals, collecting rent, handling maintenance and repair issues, responding to tenant complaints, and even pursuing evictions. Plus, a good management company brings its know-how and experience to your property, giving you the peace of mind that comes with knowing your investment is in good hands. Finally, a management company is an independent contractor, so you avoid the hassles of being an employer.

As such, hiring a professional property manager will make your life easier. This is an especially good idea for rental property owners who have no experience or don’t want to spend their time managing a rental property on their own. With a property manager, you’ll be able to ask mortgage questions if you run into any trouble with your property. Here are some reasons why you should hire a residential property manager to manage your residential property properly.


Set the right price – You can look online to see what the other landlords are charging for the same kind of property to get an idea of the rent you should charge, but a good property manager will do a complete analysis of the market to choose a rental sweet spot. You’ll have the right balance between increasing your monthly income and preserving low rents.
Search for the right tenants – An experienced property manager can help you find the right tenants. The property manager also takes care of all the details related to your property, like sorting through legal issues, evaluating credit reports, verifying employment, performing security checks, and checking references. You’ll wind up with the best fit between property and tenant.
Collect and deposit the rent payments – If you have any experience in billing, you know that collecting payments from customers is not an easy task. Property managers have efficient systems to collect monthly rent from tenants in a timely manner. This is important when you’ve reached the threshold of properties that makes collecting rent too time-consuming.
Proper marketing of your property – An experienced property manager knows exactly where and how to advertise and market your property. He also knows how to time advertisements so your property can be rented quickly, thus avoiding long-term vacancies.
Maximize profits – Hiring a property manager will help you maximize profits on your rental property. A property manager usually receives a percentage of your property’s monthly rent in return for their services. This rate ranges between 6% and 10%, which is usually less than what you’d pay to hire a team of professionals to handle the things the property manager will handle/streamline.
Landlord/Tenant Relations – In addition to finding good tenants, a property manager will stay on top of things to maintain a good relationship between the tenants and the landlord. The property manager takes care of routine inspections and deals with every situation that comes up.

By hiring a good residential property manager, you’ll successfully reduce the risks involved in the real estate game. This makes the things much simpler and more enjoyable for you.

 

How to Find a Good Property Management Company

That is easy! Freedom Property Management is for you!

Freedom Property Management LLC is a full-service residential property management, high-rise and commercial retail center firm in Orange County, California.  We provide investors with reliable and cost effective property management by utilizing the personal hands on approach.   We continually maintain cost reductions and savings through use analysis and contract re-negotiations, coordinating our efforts to achieve and sustain the highest occupancy and lowest vacancy at your properties. 

 

 

 

 

 

What Are The Benefits of Using a Property Management Company? Read this Article!

What Are The Benefits of Using a Property Management Company?

A competent property manager can add significant value to your investment, which is why many seasoned real estate investors will tell you that a good management company is worth their weight in gold.  Here are a few ways that a good property manager earns their keep:

Higher Quality Tenants

Think of tenant screening as the moat and draw bridge around your castle. It is certainly possible to get a bad tenant out of your home once they are in, but it’s a real hassle and you are so much better off never accepting them in the first place. A thorough screening process results in reliable tenants that:

• Pay on time
• Rent longer
• Put less wear and tear on the unit
• Generally cause less problems

An experienced property management company has seen thousands of applications and knows how to quickly dig for the real facts about candidates and analyze that information for warning signs. By allowing a management company to handle the screening, you will also be shielding yourself from rental scams directed at owners, and discrimination lawsuits resulting from an inconsistent screening process. This kind of experience takes time, and insomuch as it means avoiding bad tenants, scams and lawsuits it is arguably one of the most significant benefits a property management company will provide.

Fewer costly and time consuming legal problems

Veteran landlords know it only takes one troublesome tenant to cause significant legal and financial headaches. A good property manager is armed with the knowledge of the latest landlord-tenant laws and will ensure that you are not leaving yourself vulnerable to a potential law suit. Each state and municipality have their own laws, these plus federal law cover a number of areas including but not limited to:

• Tenant screening
• Safety and property conditions of the property
• Evictions
• Inspections
• Lease addendums
• Terminating leases
• Handling security deposits
• Rent collection

Avoiding a single law suit can more than pay for the property management fees, and spare you time and anguish.

Shorter vacancy cycles

A property manager will help you perform three critical tasks that affect how long it takes to fill your vacancies:

• Improve and prepare the property for rent - A property manager will suggest and oversee cosmetic improvements that maximize revenue.
• Determine the best rent rate - Too high and you are stuck waiting, to low and you’re losing money every month the tenant is in the unit. Determining the optimal price requires knowledge of the local market, data on recently sold comparable, and access to rental rate tools.
• Effectively market your property - An experienced property management company has written hundreds of ads and understands what to say and where advertise in order to get a larger pool of candidates in a shorter period of time. Additionally because of their volume they can usually negotiate cheaper advertising rates both online and offline. Lastly, they are familiar with sales and know how to close when they field calls from prospects and take them on showings.

Better tenant retention

While its easy to see the effects of lost rent, there are other equally serious problems with a high tenant turnover rate. The turnover process involves a thorough cleaning, changing the locks, painting the walls and possibly new carpet or small repairs, not to mention all the effort associated with marketing, showing , screening and settling in a new tenant. This is a time-consuming and expensive process that can often be averted by keeping tenants happy and well cared for.
A good property management company will have a time-tested tenant retention policy that ensures happy tenants with lengthy stays in your properties. These kinds of programs require a consistent, systematic approach, which is where a good property management company will shine.

Tighter rent collection process

The way you handle rent collection and late payments can be the difference between success and failure as a landlord. Collecting rent on time every month is the only way to maintain consistent cash-flow, and your tenants need to understand this is not negotiable. By hiring a property manager, you put a buffer between yourself and the tenant, and allow them to be the bad guy who has to listen to excuses, chase down rent, and when necessary, evict the person living in your property.
If you let them, your tenants will walk all over you. They have to be trained to follow every part of the lease or deal with the consequences. Property managers have an advantage because tenants realize that they, unlike the owner, are only doing their job and are obligated to enforce the lease terms. Many property managers will tell you that it is considerably easier to manage other people's units rather than their own for this reason.
Regarding evictions, there are strict laws concerning the eviction process, and doing it wrong, or trying to evict a "professional tenant" can be a MAJOR fiasco. A good property management firm knows the law and has a good process for obtaining the best possible outcome given the circumstances. Never having to handle another eviction can be a compelling reason to consider hiring a property management company.

Assistance with taxes

A property management company can help you understand which deductions you can claim, as well as organize the necessary forms and documentation to make those claims. Additionally, the property management fees themselves are also tax deductible.

Lower maintenance and repair costs

Good maintenance and repairs keep tenants happy and preserve the value of your investment which make them a very important part of land-lording. By hiring a management firm you gain access to both their in-house maintenance staff, as well as their network of licensed, bonded and insured contractors who have already been vetted for good pricing and quality work. This can translate into significant savings compared to going through the yellow pages and hiring a handyman yourself. Not only is the firm able to get volume discounts on the work, they also know the contractors and understand maintenance issues such that they are capable of intelligently supervising the work.

Increase the value of the investment

Preventative maintenance is achieved through putting systems in place that catch and deal with maintenance and repair issues early on, before they grow into larger more costly problems. This requires a written maintenance check program, detailed maintenance documentation and regular maintenance visits. The management firm can also offer you suggestions and feedback on upgrades and modifications, both how they will affect the rent you can charge, as well as their impact on maintenance and insurance.

Personal benefits for owners

• Less stress - Avoid having to deal with middle of the night emergencies, chasing down rent, evicting people from your property, tenants who wreck your property, rental scams, lousy vendors, piles of paperwork.
• More freedom - Live and invest wherever you want with the constraint of needing to be near your properties. Additionally you can live and travel without the requirement of always being available in the event that your tenants have a need you have to tend to. Once you have found a good management company, it doesn’t matter if you live in the same state. Some landlords live in other countries and simply collect their check every month without ever seeing the property.
• Free up more of your time - Time is money, and for many investors, their time can be more profitably spent in areas other than servicing their properties. When you focus on asset management you’re working ON your business, when you manage your own properties you work IN it. Additionally you have more time to spend with family or friends doing things you enjoy.

Inquire more information by sending us a email or giving us a call to answer any questions you may have about how property management can better assist you.

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