What is a Property Management Tenant Guarantee?
One feature of property management contracts we receive a lot of questions about is the Tenant Guarantee. What exactly is a Tenant Guarantee? What does it cover? How does it work? What is NOT covered?
The best property managers have developed and honed their screening criteria to identify a highly qualified and reliable tenant. In doing this, professional property managers significantly reduce their client’s exposure to evictions. By using a highly effective and proven screening process a property manager can offer a guarantee to the owner when placing tenants into a rental property.
What is a Tenant Guarantee? A Tenant Guarantee is a guarantee that the tenant will perform according to the lease. A tenant who does not perform according to the lease will trigger the Tenant Guarantee. It is important to understand what kind of situations the management contract consider to be “triggers” of the guarantee.
How Does it Work? Tenant Guarantees vary in the length of time in which they are valid. Most are valid between 30-90 days from the first day of the lease and others may be valid for 6 months or even 1 year. If a tenant moves out without good cause, owner approval, breaks the lease or gets evicted from the home while the Tenant Guarantee is in effect, the guarantee is triggered.
What does the Tenant Guarantee Cover? A Tenant Guarantee covers the cost related to finding and placing a screened and qualified tenant into a rental home – commonly know as a “Leasing Fee” or “Tenant Placement Fee”. Under most Tenant Guarantees a new tenant will be found without the owner having to pay a second Leasing Fee to the property manager.
What is NOT covered by the Tenant Guarantee? A Tenant Guarantee does not cover the costs of turnover or repairs, unpaid rent or attorney fees (your manager may offer other plans to cover these costs). A tenant guarantee is commonly limited to finding a new tenant without the owner incurring an additional Leasing Fee. A Tenant Guarantee is not a refund of the original fee paid.
I hope this has given you a better understanding of a Tenant Guarantee but if you still have questions please contact us by phone at 616-301-9450 in Grand Rapids or 269-220-6033 in Kalamazoo!
Property Management Problems and How to Avoid Them
Property Management horror stories are easy to find. If you know a real estate investor, you have likely heard about a problem he/she experienced with a property manager and Google is full of scathing 1-star reviews of property management companies.
Property management is a difficult business. Nonetheless, it is still a service-based industry and your property manager must always have your best interest in mind and maintain or (hopefully) exceed the industry standards. It is also important to recognize when things go wrong which are outside of a property manager’s control and when they are not.
Here are the most property management problems and tips which will help you avoid them:
- Below Market Rents: Rents are the largest income stream for many real estate investors. Your rents should be on par with current market rates in order to maximize your potential income. Periodically performing your own rental comps will quickly tell you if your manager is keeping up with the market. Rental comps are easy to do using any of the popular real estate apps and websites. You can also call another property manager in the area and ask them their opinion on the home and ask them to provide real life examples supporting their claims. There are times when slightly below market rents are acceptable, however, this should be discussed with your manager to weigh the pros/cons.
- Hidden Fees: Hidden fees are a problem in many industries but when your investments are on the line, hidden fees are much harder to absorb. Before you sign a property management contract make sure you have read it, you understand it and you ask questions to clarify anything you do not understand. Your prospective manager should be up-front with their pricing and not hesitant to discuss it with you.
- Mixed Messages from the Company: Do you talk to a different person every time you call the management office? Are you getting different answers to the same question? Do you have more questions now than you did when you picked up the phone in the first place? Staff turnover and over-staffing is a common problem with property management companies. Ask your salesperson about the staff you will be dealing with once you sign up and the stability of the staff.
- Poor Reporting/Communication: Timely and smart communication is ideal and non-communication is a deal-breaker. Your manager should be communicating with you regularly and fully comfortable with all modes of communication. You don’t want them constantly hiding behind an auto-attendant or administrative assistant. Their reports should be consistently delivered each month and your questions answered clearly and quickly. Any deviation in reporting or a failure to deliver reports can be a huge red flag that must not be ignored.
- Expensive: There are many factors that drive the cost of property management in a given region. Among these are: the quality of the housing, the location of the home, the current rental and housing market, local manager competition and the anticipated monthly rent of your home. Understanding your local market and the amount of work your investment properties require will help you negotiate with a property manager. A “needy” home is more expensive to manage.
- High Maintenance costs: Maintenance can be handled in two primary ways – In-house staff or trusted vendors. Each style has its pros and cons. Ask your property manager to describe their maintenance system and ask what their typical costs are to service the most common problems. You may also ask them what they will do to keep costs down at your rental property.
- Doesn’t do Inspections: Inspections are a core task of owning rental properties. Inspections should be done regularly. If a manager does not provide routine inspections they may be understaffed and incapable of servicing their clients properly. The best way to find out how inspections are handled is to find someone who is currently under their care and ask them.
- Placed a Bad Tenant: Placing a bad tenant is one of the most expensive mistakes a person can make in rental real estate. Doing the upfront work of an intense background check is paramount. The vast majority of Landlord Nightmare Stories could be avoided with this one step yet there are many who still don’t do it. Despite strict screening criteria, some tenants just fall on hard times or bad luck and this situation is not something that can be screened upfront. If you are experiencing a bad tenant find out what went wrong – is the manager negligent or is something else going on outside of their control?
- Lack of Owner Mindset: Simply put – your property manager should own rental properties. It is the only way for them to truly understand the unique stresses and satisfaction that come with operating a successful rental business. It will make communication between you and them much easier and hopefully result in a stronger relationship. Without the Owner Mindset, your property manager will be more likely to make decisions that are not in your best interest despite the fact that they may truly think otherwise.
If you have never hired a property manager for fear of having one or more of these problems, use this list as a guide when you interview potential managers – It will give you a strong start in the process and the groups you interview will know you are serious about property management!
When should you hire a property manager? As with any large decision, there are many factors that you should consider as you decide what is best for your situation.
Here is a list of 6 questions you should ask yourself to help you decide if hiring a property manager is right for you:
1. Do you know the laws related to being a Landlord? This may seem like a basic consideration, however it is important and often overlooked. The laws involved with being a Landlord or property owner are many and diverse and the consequences for violating them – intentional or not – can be severe. These laws also vary from City to City and State to State. Even if you do not hire a property manager you should – at the very least – have a real estate-minded attorney with whom you consult regularly. The MSU College of Law publishes an online guide titled “Tenants and Landlords – A Practical Guide” which can be found with a quick Google search. This is required reading for any Michigan Landlord!
2. Do you have a system in place for handling maintenance and after-hours calls from your tenants? Routine maintenance and after-hours calls are inevitable when you are a Landlord. If you are a handy person, routine maintenance may be easy and enjoyable for you. On the other hand, if you have not done any basic building maintenance, these tasks will be difficult for you and probably cost you a lot more to complete on your own than if you were to hire them out. If you plan to manage your own rental property, contact several local vendors including plumbing, HVAC and general maintenance and have them ready to go when you need them. Having backup vendors is equally important!
3. Do you live nearby your rental properties? You want to be able to check on your properties at regular intervals to make sure that the home is being properly cared for. Drive-by and interior inspections should be a part of your management routine. If you live very far from your properties, chances are you won’t be thrilled to drive by them on your day off. A local manager or agent can take on the responsibility of routine inspections and deliver a report to you.
4. Are you putting off responsibilities related to your rental portfolio? You need to honestly ask yourself if you can make the time sacrifices and tough decisions required to be a successful Landlord. Rent Collection, Late Payments, Regular Maintenance, Application Screening, Showing vacant units, and the list goes on. A high degree of consistency, diplomacy, organization and a strong team is required to be a successful Landlord. If you find yourself procrastinating any or all of these duties as a Landlord, it may be time to add a property manager to your real-estate team.
5. Are you capable of handling the financial reporting for your portfolio? Basic accounting knowledge is vital if you want to be able to understand how your rental business is performing. This is probably THE MOST OVERLOOKED ASPECT of do-it-yourself Landlords. Having accurate financial records throughout the year will save you money throughout the year and on your taxes – your tax preparer will spend less time wading through receipts and they will be able to spend more time focusing on the tax advantages specific to your situation. In addition, you will quickly be able to understand the financial health of your portfolio at a glance and know if you have a problem siphoning profits from your bottom line.
6. Do you have the time to make the most of your real estate investment? The difference between a ho-hum real estate experience and a great experience comes down to the time and experience of those who are performing the work. Leveraging the time of others with more experience will greatly increase your chances of achieving a highly successful rental real estate business. Make sure you do not burn yourself out!
When investing in real-estate, it is important to focus your time and energy on the tasks that bring you the best return and enjoyment. If these 6 questions make you shudder with anxiety then hiring a property manager is probably going to be a good thing for you. If you feel that you have a solid grasp on these topics and enough time to attend to them then you can probably self-manage without too much assistance.
Access Property Management Group:
Resident Education Video – How to Submit an Online Work Order.
Today we are going to teach you how to submit a work order online through your Resident Portal.
First thing you want to do is go to AccessPMGroup.com and click on the Resident’s Login tab and then click the Login Now button. From there it will take you to a login page, where you will need to enter your email address and your password.
Now we are logged into the Resident Portal.
Scroll across the top here and hit the maintenance tab. We already have a couple of work orders in the system. One was already done and closed out and the other one I put in and was canceled – these are all options that you have as a tenant. So now we have something else that’s wrong / broken in your unit so we will put in a new service request. Starting from the top of the entry form, first you’ll have our address here and the specific location of the work is going to be the basement.
We have a smoke detector issue. A smoke detector is beeping. So once we put that in we can click here to determine what our best contact phone number is. It will autofill to your mobile phone and will also have your email address. If you want to upload a picture you can do that by choosing a file and then click the Save button. Once you click save, that work order will then be submitted to the office and we will send a vendor out. That vendor will call you or email you and schedule a time. If the smoke detector stops beeping and you want to cancel, you can come up here to click the “Cancel Service Request” button, or if you entered the wrong information you can click “Edit.” That is how you submit a work order online. If you have any questions please email or call us at 616-301-9450 or in Kzoo at 269-220-6033. Grand Rapids Property Management, Access Property Management Group.
Today we are talking about property management pricing and costs in West Michigan. At Access Property Management Group we have three pricing options for our owners.
The first is our Premier Plan. This plan is 18% of rents collected each month and it includes all of the tenant placement or leasing fees, includes all the lease renewal fees, includes our tenant guarantee, as well as our Eviction Protection Plan. This plan was designed to keep property management costs stable and predictable from month-to-month and year-to-year. You won’t see spikes in the property management costs when a tenant moves in or when a lease renewal occurs.
Our next plan is our standard pricing. This is more in line with the traditional pricing structure that you are probably used to. This plan is 9% of rents collected each month. The tenant leasing or placement fee is 65% of one month’s rent and lease renewals are completed at a fee of $200 each.
With all our plans you get access to your property manager’s personal cell phone numbers. You can call, text or email anytime.
Our last plan is our flat rate plan. This is $99 per month, per unit. It is structured with all of the same services that you would receive under the standard traditional pricing. We designed this plan for property owners who have rentals that rent above the market average, to keep property management costs in check each month.
If you are interested in more information on any of these plans you can click the Sign-Up button under each plan and that will take you to our contact page which you can fill out and we will be in touch with you quickly after we receive your inquiry!
You can also call our office in Grand Rapids at 616-301-9450, or if you are in Kalamazoo you can call 269-220-6033.
Resident Education Video: How to add a payment account
Hi everyone, today I’m going to show you how to add a payment account in your tenant portal.
Go to AccessPMGroup.com and click on “Tenant Login” on the upper right hand side, and click “Login Now.” You will be taken to the login screen of your portal. Once you’ve logged in you will come to the home screen inside the tenant portal. What you want to do is click on the “Add Payment Account,” which is the orange button near the center of the screen.
Once you’ve done that you will have an option to use either the eCheck, which is ACH direct debit from your checking or savings account, or a credit card. The ACH option is free. You can also use a Visa, Mastercard or Discover credit or debit card; there is a fee to use this option but it is there for you if you want to do it.
Once you have selected your preferred payment method the next step is to complete the required fields. You want to enter your bank name, click checking or savings, enter your bank routing number which is always going to be a 9-digit number, and your account number. Give the account a nickname so that you can easily identify it when you are in your portal making payments. Fill all your personal information including name, billing address, birthday and your email address. Click “Save.”
Once you’ve done that you have successfully added your payment account. Now you can make a one-time payment or you can schedule recurring payments. If you want to schedule your rent to be paid automatically on the same day each month for the same amount, you can schedule a recurring payment and that will happen. Otherwise you can login to your portal each month and make a payment for that amount manually.
Access Property Management Group.
Many Owners ask us “Where is your office located?”
Hi this is Eddie with Access Property Management. Today we are just doing a quick video on where our office is actually located. We rarely get anybody to stop by but we wanted to show you in case you want to head out this way.
The sign in the back right about there (see location on video) is for Boltwood Apartments. We manage 48 units here in Allendale so our office is inside one of the old units.
Welcome to Access Property Management Group’s Office. Right outside our door is our secure 24-hour drop box for rent payments, we do provide envelopes and a pen for your address. Our office is not that big but it’s just the right size for us. We have my desk here, Aaron’s desk and our Mac computers which we love. Also the whiteboard over here is for our Move-ins and Move-outs for the current month. We also have this big whiteboard. This is for our properties that are going to be for lease or are currently on the market, along with our monthly turnovers.
We have our model unit for the apartment complex that we manage down here. Bathrooms and more offices down the hall and that’s about it. Just wanted to show you around in case you are ever out this way.
Please give us a call at 616-301-9450 or www.accesspmgroup.com
Hi! This is Aaron with Access Property Management Group. Today I’m going to be going over the owner statement.
Summary (page 1)
The first page of our owner statement is always a summary of all your activities. It’s going to have one line for all your rental income, one line for all your expenses and one line for your management fees. It’s a real quick overview to get a glimpse of how your portfolio is doing.
The body is where you are going to find all the details of all those transactions. It will show all of your rent received and it will be broken down by each payment. We are going to show all the bills that were paid, again those will be broken down into vendor information. It’s going to have all the maintenance notes related to each bill and it will also show the amount of those bills.
Lease Summaries (last page)
The last page will have your lease summaries. It will have the names, total security deposit, total monthly rent and then the location where that lease is held, and also any unpaid bills that we have are shown at the bottom of your report.
If you like to see a sample of our owner statement feel free to fill out our contact form and we will be happy to send you our owner handbook. We’ve got a sample owner statement in there that you can review.
You can always contact us with any questions at 616-301-9450 in Grand Rapids or 269-220-6033 in Kalamazoo.
“How much will my home rent for in Grand Rapids?”
Hey everybody, this is Aaron with Access Property Management.
As property managers, one of the biggest questions we get asked is “How much money will my home rent for?” Here’s how we do it:
First thing we look at is comparables. We pull properties from our current management portfolio that are in your neighborhood and we look at them and compare them to your property and find out where your property falls in the mix.
We also look at properties that are currently listed because these are going to be your active competition. We want to make sure you are priced fair.
We look at your property and see what it offers that other properties don’t. We also look at what your property does not offer that other properties do offer, because this all has an impact on the final rent price.
The final thing we think about is season. In Michigan in particular, the prime leasing season falls approximately between April and early September. Outside of that time you may experience longer vacancy and possibly less rent, just due to the fact that not very many people like to move in the middle of winter.
FREE MARKET RENTAL ANALYSIS!
We do offer a free market rental analysis of your home. If you are interested in taking advantage of this please fill out the contact form and we will be happy to meet you at your property and tell you what we think.
You can contact our office by phone at 616-301-9450 in Grand Rapids or in Kalamazoo at 269-220-6033.
Hi this is Eddie with Access Property Management. Today we are talking about maintenance, from start to finish or The Work Order Life Cycle.
When I meet a new owner for the first time they have lots of questions, one of the most important is what happens when a work order is put in or a maintenance request is submitted by the tenant?
Step One: Tenant submits a Work Order Online
First off all work orders must be submitted in writing and preferably online. From there they have to fill out the work order form, they then press submit and it goes to us as your property manager and also to you as the owner in real time, so you are always in the loop and always notified about what is going on at your rental.
Step Two: A licensed and insured vendor is dispatched
We then send out a licensed and insured vendor to the work site. Vendors are chosen based on scope of work, availability and distance to the job. At this time the vendor will complete the requested work. If the work is going to cost over $300 then we will notify you and verify that we can move forward with the work.
Step Three: We receive an invoice and add the repair remarks to your Owner Statement
The repair has now been completed. The vendor then emails us an invoice along with all the notes on what they did at the job site. We upload the remarks to your owner statement. When you receive your Owner’s Statement on the tenth of every month, it will note exactly what happened, what the cost was and when the maintenance job was closed out.
Maintenance can be a real headache or it can go very smoothly. We use only licensed, insured and competent vendors to get the job done right the first time. If you have any questions give us a call at 616-301-9450 or www.accesspmgroup.com.
Access Property Management Group, What Makes Us Different?
Hi this is Eddie with Access Property Management. Today we are talking about two things that make Access Property Management different from the other Property Management companies.
First thing is Communication. Yes everybody communicates. Does everybody give out their cell phone numbers? NO. All our owners have our cell phone numbers. They call us, they text us, and they email all the time and anytime. That’s what we love. They are always communicating with us and we communicate with them. No one’s left in the dark, no surprises!
The second thing is our Hands-on Property Management style. Our office, which you can view here, has walk-in hours three days a week. The other four days, yes I said four days, we are out driving by properties, taking pictures for owners, and checking on maintenance work. We are checking up on all the things that we have promised you and making sure they are done.
So would you rather your property manager be sitting in front of a computer five days a week or out there looking at your investment?
Please give us a call at 616-301-9450 or www.AccessPmGroup.com
Hi this is Eddie with Access Property Management Group. We are going to do a quick two part blog on how to add some value to a kitchen without fully remodeling it and saving some valuable dollars in the meantime.
In our first walk through we have a kitchen that’s still lost in the 50’s and 60’s. You can see by the pink counters and small 4×4 pink plastic tiles that nothing has been done to this kitchen in years. The room does have lots of nice arches and plenty of cabinet space but it still needs some work to bring it to life.
We will be back in a week to finish this blog and by just adding a couple of dollars without a full remodel we will hopefully make this space look a lot better and it will add some value to this old kitchen.
We are back and done with our retro kitchen remodel. It’s done, it’s been cleaned and we did all the light maintenance items that we wanted to. We have some dark gray paint accents on the walls, new black and grey vinyl checkered floors. We left all the pink counter tops as they cleaned up really well and the original cupboards are looking great. It gives us that retro look that we wanted without having to rip out the entire kitchen. It’s now a great looking kitchen for minimum dollars.
Call or email us today at 616-301-9450 or email@example.com or www.accesspmgroup.com
Hey everybody, this is Aaron with Access Property Management!
I wanted to talk today about the homestead property tax exemption, formally known as the “principal residence exemption” or PRE. In Michigan, this is a reduction of 18 mills each year on your property taxes for the home that you live in as your principal residence.
Many times when a first time landlord moves out of the home they were living in and decide to lease it they don’t realize that their property taxes are going up by those 18 mills and it’s often missed when they are considering the cost-benefit of doing the rental.
So if you are going to be doing a rental on a property that you’ve been living in make sure you get on the county or city website and get that millage data. When this homestead exemption expires it can increase your annual property taxes anywhere from 30%-50% depending on the municipality and your current millage rates.
If you have any other questions about this please contact us at 616-301-9450 in Grand Rapids or 269-220-6033 in Kalamazoo. You can always reach us on our website at www.AccessPmGroup.com
Grand Rapids Access Property Management Group – Tenant Termination Forms
Hi, this is Eddie with Access Property Management Group. Today we are talking about what to do and what notices to send if your tenants don’t pay. There are two forms that you can send out.
The first one is a “Demand for Possession Nonpayment of Rent.”
This is a 7-day notice that can be sent anytime during the month. In essence the tenant has 7 days to pay or vacate. If the tenant pays within the 7 days they can stay in the unit. After 7 days of non-payment you can file for a court date in your local jurisdiction.
The second notice is a “Notice to Quit Termination of Tenancy.”
This is a 30 day notice that can be sent at anytime if the tenant breaks the lease or you want them gone after a lease has expired. After 30 days if they are not out you can file for a court date.
When filling out these forms always add “and all other occupants” in the “To” box so that it covers everyone in the home whether they are on the lease or not.
Both forms have two pages. One’s for the tenant and one’s for you. Make sure you fill them out correctly, send it off in the mail and hopefully you’ll get paid!
If you have any other questions, give us a call at 616-301-9450 in Grand Rapids or 269-220-6033 or www.accesspmgroup.com
Property Management costs can be a controversial expense among property owners. Ultimately, the decision to hire a property manager is a personal choice and the reasons which motivate the decision are diverse.
As with many big decisions in real estate investing, there is usually a catalyst moment or a realization which causes someone to seek out a great property manager. My experience has shown me that most of these decisions are made so that the owner can better use their own personal time.
By identifying and acting upon the best use of YOUR time you will quickly improve your quality of life in a number of ways – stress reduction, more moments of happiness, attainment of personal goals – to name just a few. This also has a positive spillover effect on those closest to you.
If you would like to read more about this topic, please read my full blog post here on Bigger Pockets.
Today we are at a house and we are getting ready to lease it. The owners decided to include some furnishings with the lease and we are just here to document those items to make sure they get in the lease, to make sure we have a good record of them at the time the tenant moves out to ensure that none of those items disappear.
So we are just taking pictures and we are going to document them in the lease. We are going to write it all out…how many items, what kind of items and also keep the pictures with the lease so that the tenant is on the same page as we are.
If you have any questions about this or would like some more information about leasing your home, you can contact Access Property Management Group at 616-301-9450 in Grand Rapids or in Kalamazoo you can call 269-220-6033.
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When you’re preparing a house for the rental market, there are a couple of things you can do that are inexpensive but will have a lot of value for renters. Doing so will help you increase your rental income because with just a few remodeling details, you can charge more monthly rent. Today, we’re in a house in Kalamazoo that I am rehabbing in preparation to rent out. read more…
Local landlords and rental property owners ask a lot of questions about Section 8, so today we’re clarifying what Section 8 is, and whether you’re required to accept it. We’ll also share some tips that you might find useful if you accept Section 8 vouchers now or in the future. read more…