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NAR CEO Bob Goldberg readies to ‘embrace disruption’ on his first day

Inmannews - Tue, 08/01/2017 - 2:16pm
Today is Bob Goldberg's first day as CEO of the National Association of Realtors, and he wants the trade group's 1.2 million members to know his tenure is not going to mean business as usual ...
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Check out loanDepot’s very SoCal plans for its ‘mello Innovation Lab’

Inmannews - Tue, 08/01/2017 - 12:20pm
LoanDepot's "mello," a proprietary end-to-end digital lending platform, is getting its own Irvine, California-based tech campus dubbed the "mello Innovation Lab." ...
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Roundup Valley Ranch listing video features the music of Elton John

Inmannews - Tue, 08/01/2017 - 9:08am
Ever wondered where artists get their inspiration? If you're songwriter and visual artist Bernie Taupin -- perhaps best known for his 50-year collaboration with pop singer Elton John -- then you consider Roundup Valley Ranch "incredibly inspirational." ...
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Douglas Elliman buys Los Angeles-based Teles Properties

Inmannews - Tue, 08/01/2017 - 8:33am
Douglas Elliman announced today that it will buy Los Angeles-based brokerage Teles Properties, making Douglas Elliman the second largest non-franchise brokerage firm in California ...
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The 5 Most Common Reasons Tenants Leave Your Rentals

American Apartment Owners Association - Tue, 08/01/2017 - 7:57am

Why are renters leaving your units? What can you do about it?

Tenants are on the move. What are the most common reasons they may leave your rentals? How can landlords prevent these moves to keep good tenants, maintain consistent cash flow, and maximize cash flow?

The 5 Most Common Reasons Tenants Leave Your Rentals 1. They want to move somewhere cheaper.

Housing costs, especially rents, have been rising for the last five years. Some are just at the point where it makes sense to move somewhere cheaper where renters can get a lot more for their money. It could be that local rents have just gotten too high—or maybe your rents, in particular, are too high.

Market rents change over time. Be sure you stay tuned into local trends, even when you aren’t actively looking for tenants. If neighboring properties are leasing for 30% less than yours, that could become an issue. Price your properties right. Invest in stable and upcoming locations with more room for growth.

2. They’re afraid of changes in the rental situation.

Sometimes tenants leave just because they are afraid. They may be afraid of how much they think you are going to raise the rent when it comes time to renew. They could be afraid you are going to evict them because they’ve fallen a few days behind on rent a couple times. Or it could be that a tough new property manager you’ve brought in is causing panic in the renters.

Set clear expectations. Get feedback from loyal, long-term renters you trust when you bring in new management, connect with them about renewing leases early, and maintain property upkeep to show tenants you’re a caring landlord, not a slumlord.

3. They need more space.

Between a growing number of multigenerational households and Millennials’ growing families, many simply need more space today. A lot of people jumped on the minimalist lifestyle after 2008, but now, years later, they are tired of living so tightly and cramped. In fact, a Realtor.com survey shows that this is driving far more Millennials and Boomers to choose single family homes in the suburbs over homes in dense urban centers or condos.

4. They want to buy a home.

With rents more expensive than mortgage costs in many areas, interest rates low, and credit scores recovering, many are making the leap to buy homes while it is still so attractive. If you can’t stop it, make the best of it. Ensure a good exit service. Return deposits and ask for a review on the spot. Still, if you can, get them to buy their home from you.

5. They don’t like the neighbors.

No one likes scary or abusive neighbors—and they are out there. This is something to keep in mind when searching and screening rental properties. It is also important to keep lines of communication open and to listen to these complaints. If there are problem tenants in your own neighboring units, you probably won’t renew their leases. If they belong to another landlord, you may want to preempt issues by contacting the other landlord.

Summary

There are a number of reasons good tenants can leave, even if they like the units they are in. Smart landlords will get out in front of these issues and find ways to keep those tenants in their property to avoid turnover costs.

What are the most common reasons tenants leave your rentals? How do you minimize the effects of those reasons?

Leave your comments below!

 

Source: biggerpockets.com

The post The 5 Most Common Reasons Tenants Leave Your Rentals appeared first on AAOA.

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Opendoor targets Atlanta and Raleigh, North Carolina

Inmannews - Tue, 08/01/2017 - 7:03am
Opendoor, a leading "iBuyer" that uses technology to allow homeowners to sell their properties in days, has set its sights on Raleigh, North Carolina and Atlanta ...
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Objection handler: ‘You can’t do anything better than my last agent’

Inmannews - Tue, 08/01/2017 - 3:00am
Homeowners with expired listings may bluntly and pointedly say: “I don’t think you can do anything better than my last agent." How can you prove them otherwise? If time were to stop when prospects utter this objection, a fork in the road would emerge with two paths: one that marks the start of your relationship with a client, and another that stops before it begins. Where you end up depends on what you say in the moments immediately after ...
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5 simple staging tips that make a home irresistible

Inmannews - Tue, 08/01/2017 - 2:30am
When buyers walk into the right home, they get that look in their eyes. They get the warm-and-fuzzies because they can envision living in the home for years to come. As a listing agent, it's your job to make sure that happens; you have to facilitate the buyers' ability to see themselves in that home, and the easiest way to do that is through staging ...
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What real estate agents should know about zero-down loans

Inmannews - Tue, 08/01/2017 - 2:00am
No longer do you have to be a qualified veteran or live in a rural area to get a mortgage without putting down a penny. For nearly a decade, only buyers who qualify for VA or USDA Rural Development mortgages have been able to buy a home with zero down ...
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Real estate expansion: 3 traits teams need for successful business growth

Inmannews - Tue, 08/01/2017 - 1:30am
Real estate expansion is one of the few ways to boost a real estate business’s profits exponentially and ensure its long-term success ...
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The Facebook ad campaign that won’t let leads forget you

Inmannews - Tue, 08/01/2017 - 1:15am
Do you ever worry that you're missing out on leads online? This post will explain how to avoid losing leads online using a Facebook ad campaign ...
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7 habits of highly effective real estate agents

Inmannews - Tue, 08/01/2017 - 1:00am
You've most likely heard of The 7 Habits of Highly Effective People: Powerful Lessons in Personal Change, written by Stephen Covey in 1989. It has been adapted and has sold millions of copies over the years ...
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Kingsley: Renewal Intent Rises Again, Rental Rates Hold Less Sway Over Renewal Decisions

American Apartment Owners Association - Mon, 07/31/2017 - 10:59pm

Over the past two and a half years, overall multifamily resident satisfaction has remained continuously steady, with overall satisfaction scores ranging from 76.6% to 76.8% over the past 10 quarters, notes research firm Kingsley Associates in its quarterly report. This past quarter, the percentage of residents satisfied comes in at the top of that range, with 76.8% indicating their overall satisfaction is “good” or “excellent.”

Delving down to the market level, overall resident satisfaction is constant among large metro areas compared with a year ago. The largest increase in satisfaction transpired in Denver, with 1.8% more residents reporting they’re satisfied with their experience than in Q2 2016. While the overall satisfaction rate for Denver throughout all of 2016 was lower than during the previous year, this year has proved different, with satisfaction scores so far topping those of 2016.

Increases in Renewal Intent and Value for Amount Paid

In the first quarter of 2017, the upward trend of national renewal intent halted after three quarters of significant increases. During this past quarter, however, the positive trend returned with a jump of 1.0% from Q1, bringing the national renewal intent to a three-year high of 54.0%.

This trend goes hand-in-hand with the increasing number of residents who are satisfied with the value they receive from their apartment for the amount they pay. After almost two years of decreasing satisfaction in the value for amount paid, a turning point occurred in the second half of 2015. Since then, an upward trend has developed (see chart, “Value for Amount Paid,” above). However, as with renewal intent, there was an interruption in the satisfaction-with-value trend during the first quarter of this year. The second quarter of 2017, however, saw the restoration of the upward trend, with a gain of 0.3%, resulting in 55.0% of residents being satisfied with their value for amount paid.

Given the current multifamily market, notes Kingsley, it’s not surprising that both renewal intent and value for amount paid increased overall for renters in Q2 2017. By the end of the year, it is expected that just under 400,000 new units will have come to market, which is 38.3% more than were delivered in 2016.

The demand for apartments can’t keep up with the new supply, which is pushing the vacancy rate higher. The national vacancy rate already increased from 4.3% in Q1 to 4.4% in Q2, and 222,000 new units are still expected to be delivered to market before the end of the year. With the oversupply, specifically of Class A buildings, which are at a seven-year construction high, apartment owners and managers are being pressured to keep rents low and competitive to entice prospects to lease and residents to renew.

With lower prices, renters are becoming more satisfied with the value for amount paid to rent an apartment than if they were to purchase a house. With the low inventory of resale houses, the limited supply of new homes in affordable brackets, and home prices reaching a 31-month high at the start of this year, homeownership has become less the norm, especially for the millennial generation.

The limitations on purchasing a home in the current market, coupled with lower rents from oversupply, have created a heightened desire among residents to renew their leases and extend their time at their rental units.

Market Trends Follow National Trends

This quarter’s market trend data support the national renewal-intent and value-for-amount-paid trends. When looking at renewal intent by market, only two metro areas experienced a decrease in renewal intent compared with last year, while six of the markets saw an increase of more than 1.0%. Renewal intent dropped in Miami and San Francisco, by 3.2% and 0.4%, respectively. Meanwhile, Washington, D.C., and Atlanta had the largest growth in renewal intent, by 7.6% and 3.5%, respectively.

Many markets also saw increases in value for amount paid, with Denver, Miami, New York, and Washington, D.C., all increasing by more than 3.5% from last year (see chart, “Value for Amount Paid by Market,” above).

This is the first significant increase in value for amount paid for New York over the past 12 months. New York tops the list as both the metro with the most demand for apartments in Q2 2017 and the metro with the most new units to be delivered this year, at 28,158 new units. In comparison, the largest drop in value for amount paid happened in San Francisco, with a decrease of 3.4% from last year. San Francisco failed to make the list of the top 15 markets for demand this past quarter and came in at No. 22 for new units to be delivered this year, with only 4,587 units.

Rental Rate Becomes Less Influential on Renewal Decisions

The changes in renewal decision-making factors also reinforce the national trends seen this past quarter due to lower rent prices, reports Kingsley. In the past year, the importance of rental rate as a renewal decision factor declined by 2.2%, dropping from 56.4% in 2016 to 52.2% so far this year.

Over the past year, rental rate has been the top decision-making factor, followed by location as a close second. But in Q2 2017, location ranked as the top renewal decision-making factor, with rental rate coming in second. For residents who are unsure or unlikely to renew, rental rate remains the top decision-making factor when it comes time to renew. However, for residents who are likely to renew, rental rate dropped to third among the most influential factors, behind location and community management.

Controllable Factors Affect Leasing Decisions

Many factors influence a renter’s community selection, Kingsley found. Location ranks first, with 91.0% of prospects listing it as important to their leasing decision. While location may not be a controllable factor, the second-ranking factor on the list, property appearance and quality (90.0%) certainly are. With only a 1.0% difference between the importance of these two factors, enhancing property appearance and quality could make a notable difference in persuading prospects to lease at a community.

Over the past five years, three additional factors have increased significantly in importance regarding leasing decisions: property staff and management, community amenities, and online ratings and reviews.

Whereas community amenities may not be easy to change, staff and management and online ratings and reviews are more easily controlled factors. Online ratings and reviews, in particular, have increased in importance by 12.0% since 2012. Currently, Google, ApartmentRatings.com, Yelp, and Apartments.com rank as the top four most-useful online ratings and reviews resources.

Looking back three years, the top four most-useful online resources were ApartmentGuide.com, ForRent.com, Zillow, and Yelp. Additionally, since 2014, the usefulness of Rent.com, Facebook, and Apartments.com as reported by prospects has skyrocketed, by 19.0%, 18.0%, and 12.0%, respectively.

 

Source: multifamilyexecutive.com

The post Kingsley: Renewal Intent Rises Again, Rental Rates Hold Less Sway Over Renewal Decisions appeared first on AAOA.

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Smaller Housing Markets Lure Individual Investors

American Apartment Owners Association - Mon, 07/31/2017 - 10:46pm

After Andrew Bahr, a structural engineer, lost a bidding war last fall for a two-bedroom apartment in Queens, he decided he was done trying to buy real estate in New York.

“I was tired of looking around me and seeing all the home prices shooting up and I’m not getting a piece of that pie,” said Mr. Bahr, 26, who was stunned when a buyer offered $15,000 more than his $345,000 bid on the apartment in Jackson Heights.

Rather than wait for another apartment to come along, or save more money, he turned his gaze well beyond the city limits, all the way to Atlanta. On March 1, he bought a four-bedroom house there for $100,000.

In doing so, he traded in the dream of living in a home he owns for a chance to turn a profit.

A tenant lives in his Atlanta house, paying $1,050 a month — enough for Mr. Bahr to pocket $400 each month after paying his mortgage, taxes and property management fees. Mr. Bahr lives in Jackson Heights, in a studio he rents for $1,467 a month. “We live in the wrong state, we definitely do,” he said.

Mr. Bahr’s unconventional path to ownership is one that was carved in the aftermath of the 2008 financial crisis. After millions of distressed homes flooded the market across the country, some large institutional investors, like Blackstone, began buying and transforming single-family homes — a symbol of American upward mobility — into rental properties.

While publicly traded companies like American Homes 4 Rent and Colony Starwood Homes are major players in this market, most single-family rental properties are owned by small-time investors, like Mr. Bahr. In 2015, 85 percent of the 17.5 million single-family rental properties in the United States were owned by investors with portfolios of 10 properties or fewer, with 45 percent of those houses owned by investors with only one property, according to the Housing Finance Policy Center at the Urban Institute, a research institution.

Mr. Bahr found his house through a California-based company called HomeUnion, a one-stop shop for small-time investors that helps people buy, renovate and rent properties in 11 markets around the country. HomeUnion charges an acquisition fee of 3.5 percent of the purchase price; management fees of up to 10.5 percent of the rent; and a 10 percent fee for renovations over $2,500.

In exchange, Mr. Bahr can be a landlord at arm’s length. He has never visited his property and does not know the name or occupation of the person who rents it. “Sometimes I wish I was more involved,” he said. “A big part of my savings went into that property, and I feel like I should help out, but they’re doing it all for me.”

Don Ganguly, the chief executive of HomeUnion, which started in 2014, said that most HomeUnion investors live in expensive coastal markets, like San Francisco and New York, where salaries are high but so are housing costs. Their dollars go further in smaller markets, like Indianapolis, Dallas and Orlando.

The need to look further afield for what is affordable is common for New Yorkers just searching for a place to live. Can’t afford to live in Brooklyn Heights? Give Bedford-Stuyvesant a try. If all of Brooklyn is out of your budget, welcome to New Jersey.

It turns out that aspiring investors face a similar conundrum. The mom-and-pop landlord who may have bought a rental property around the corner a decade ago now also needs to look further, and since there is no need to actually live in the home, that net can be cast far and wide.

“In many ways, it’s an extension of the search for affordability in New York,” said Jonathan J. Miller, the president of Miller Samuel Real Estate Appraisers & Consultants. “This becomes another leap.”

But there is a difference between moving with your family to the suburbs and buying a house that is a plane ride away and occupied by a stranger. Buying a property that you may never see changes your relationship with it. Mr. Ganguly, who was initially surprised by how few HomeUnion investors flew out to see the houses they were about to buy, compared the process to buying stocks. “They flipped the switch in their head to say, ‘It’s an asset,’” he said.

Like stocks, a house may appreciate in value over the years, while rental income offers a steady return in the short term. On HomeUnion’s website, listings include detailed projections for returns. The company estimates that, on average, investors who put down 20 percent on a property and hold it for 15 years can expect annual returns of 11 to 19 percent, a figure that includes rental income, appreciation, and increased equity.

But buying a house is hardly the same as buying stock in a company. Stocks don’t have roofs that leak or tenants who stop paying the rent — and stocks don’t come with monthly mortgage bills.

HomeUnion recommends that its investors set aside $1,000 per property in a reserve fund. However, $1,000 will not necessarily cover the cost of a boiler breaking the same month that a tenant moves out. If you lose your job or have other financial strains, you could be a paycheck away from trouble, even if your property is appreciating on paper.

“The possibility of a surprise $5,000 fee is always there,” said Callum Runcie, 42, who lives in Port Washington, N.Y., with his family and who owns three investment properties through HomeUnion. He earns about $2,000 a month on the portfolio. An air-conditioner recently broke at one of his properties, and he was waiting to hear back on the repair cost. “They said it’s kind of a big deal,” he said, referring to the property managers at HomeUnion. When a tenant moved out of one property, Mr. Runcie spent $2,000 on renovations while the home was vacant for two months.

Investing in a market that you do not know, and relying on a third party to manage the property, requires research, and trust in the company providing the information. “The biggest risk, if you’re investing in real estate, is that the house doesn’t appreciate,” said Nela Richardson, the chief economist for Redfin. “Not having local expertise is like going in blind.”

HomeUnion offers local market reports and listings that include details about local salaries, rents, and demographics. Mr. Bahr read up on Georgia tenant laws before he purchased his home to make sure that he could easily remove a difficult tenant, if necessary. And, he has relatives who live in the Atlanta area, which made him feel more confident about it.

Ultimately, Mr. Bahr sees Atlanta as a more realistic option than the market where he lives. “I don’t think I’m ever going to be able to own a home in New York, unless my salary doubles,” he said. “I’d have to wait 20 or 30 years for that to happen.”

Instead of waiting on New York, he is planning to buy a second rental property in Atlanta.

Source: nytimes.com

The post Smaller Housing Markets Lure Individual Investors appeared first on AAOA.

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A month in review: The June housing market

Inmannews - Mon, 07/31/2017 - 1:57pm
Every month, economists release a number of indices, reports and analyses of the housing market, and it can be difficult to keep up with them all. ...
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Coldwell Banker offers industry news via Amazon’s Alexa

Inmannews - Mon, 07/31/2017 - 1:43pm
As a torrent of new technologies and business models take real estate by storm, it can be difficult to keep up. Coldwell Banker is aiming to help agents stay in the know by serving up industry and company news through Alexa, Amazon's voice-activated assistant ...
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