16 minute read
Top 3 Investment Property Features Impacting Rent
By: Don Lewis
According to research by the National Multifamily Housing Council, over 44 million people in the U.S. rent their homes. If you own an investment property, you know just how important it is to appeal to these renters — and upgrades are one of the best ways to do so. The time and money that you pour into your property can pay off quickly if you choose the right improvements. This is why it’s imperative to ensure that upgrades appeal to prospective renters. Consider the following three features that you should pay attention to when you’re searching for an investment property.
1. Serious Functional Issues
Repairs are the most basic upgrade that any landlord must complete. If there is a known issue affecting the comfort of your tenants — or even impacting a unit's livability — you need to invest in a solution as soon as possible. This is especially true if the issue affects essential systems like the property’s plumbing or electricity. Performing these repairs may not raise the value of the unit, per se — but failing to do them will certainly lower it.
2. Attractive Amenities — or Lack Thereof
When a prospective tenant is looking for housing, they’re looking for a place they can be comfortable — and that’s exactly what the right amenities will provide. Features such as kitchen storage, in-unit laundry, and dishwashers can all make a major difference in the appeal your property has — and thus the rent you can charge. Although installing new amenities may incur substantial expenses, those expenses can also yield greater rent revenue.
3. Quality of the Property’s Location
You can’t necessarily upgrade the area that your property is in, which is why you need to look for a rental that’s already in a good area. Location is one of the biggest factors that influence how much a renter is willing to pay.
Other factors such as
the type of home are important, too — is it a single-family home or a unit in a multiplex apartment? Is the neighborhood best suited to families or is it a lively area in a college town? Answering these questions can help you narrow down the best locations.
Other Factors Impacting Profits
Location and amenities aren’t the only issues that can impact the revenue from your investment property. When you purchase a new unit, you need to consider whether you want to manage it yourself or enlist help from a property management company. The latter can be costly, but it can also reduce stress. If you’re planning to manage your property by yourself, renter screening services from TenantTracks can ensure you’re renting to trustworthy tenants.
Similarly, if you’re paying too much in taxes, you may be losing a major portion of your income. Forming a limited liability company (LLC) is the best way to combat this while also minimizing paperwork and increasing flexibility. When forming an LLC, partner with a formation service to save money—research the best LLC services online to handle the paperwork.
Boost Your Passive Income With Strategic Property Upgrades
Investing in a new property is exciting, but you’re leaving money on the table when you don’t choose the right upgrades. If you want to maximize your rent potential, invest in upgrades such as new appliances and better storage — in addition to performing routine repairs. You should also consider whether it’s best to outsource management. Also, forming an LLC can help shield you from risk and allow you to gain tax advantages.
Upcoming Monthly Meetings:
Monday, Oct. 17 at 5:45 pm at the Sheraton Rocky Hill, 100 Capital Blvd. Rocky Hill, CT. Tuesday, Oct. 18 at 5:45pm at Keller Williams Prestige, 2777 Summer St. Suite 700, Stamford, CT. The speaker will be Damon Remy and the topic is "building your dream business and conquer the uncertainty with a steady flow of leads". He will cover: How To Go From A Stressed Out Investor Always Worried About Where The Next Deal Is Coming From…To A Lead-Generating Machine. Here’s what you’re going to learn: The two most popular lead generating tactics that don’t work anymore How to get crystal clear on a business model that supports your dream life How to predictably generate leads How to close more deals Cost is free for members and $39.00 for guests. Contact: 860-265-4414 Register for Monday, Oct 17th here!
Register for Tuesday, Oct. 18th here!
About the Speaker Damon Remy
For more than two decades, Damon has made a home for himself on the leading edge of technology. Utilizing the Internet since the dial up days of yore, he continues to create progressive systems that allow companies to operate faster, more effectively, and more profitably!
Damon began his technology career in the US Marine Corps. Hand selected by his commanding general, he played an integral role in scouting, evaluating, and implementing the latest, most advanced technologies. At the time the technologies he utilized, such as IP video conferencing and logistical management systems - commonplace in today’s market - were groundbreaking and cutting edge, even to the government.
After his military career, Damon’s true nature as tech geek and digital entrepreneur emerged as he consulted with several companies, using technology to streamline and innovate their processes from the ground up. He renewed the operational effervescence of one of the nation’s oldest Pepsi distributers through the complete revitalization of their internal systems.
In 2001, the world of real estate opened its arms to Damon, offering him a place as a consultant with a fast growing mortgage company that focused on real estate investors. In that rapidly expanding high-speed market, Damon developed systems for management workflow, lead tracking, and total business automation that skyrocketed many of his Loan Officers to national production rankings.
It was there in the trenches of the booming mortgage market that the concept for REI BlackBook was born. It’s mission: work more effectively, productively, and profitably by simplifying in-house operations. In 2009, after several years of testing, a beta group of REI BlackBook users began seeing exceptional results, leading to the initial public launch and record day 1 sales. Today, REI BlackBook is the software of choice for leading real estate investors and the recommended platform by the nation’s #1 Real Estate Education Company.
Fall and Winter Energy Savings Tips
By: Energy Saver, from energy.gov
The following tips will save money and energy while staying comfortable during the cool fall and cold winter months. Many of these tips can be used on a daily basis to increase your savings; others are simple and inexpensive actions you can take to ensure maximum savings through the winter.
If you haven't already, conduct an energy assessment to determine where to save the most, and consider making a larger investment for longterm energy savings.
Take Advantage of Heat from the Sun
Open curtains on the south-facing windows during the day to allow sunlight to naturally heat the home, and close them at night to reduce the chill from cold windows.
Be certain to plant deciduous trees on the south facing side of the home, especially in proximity to windows. They will let the light and warmth in the windows during the winter and will shade the windows in the summer.
Cover Drafty Windows
Use a heavy-duty, clear plastic sheet on a frame or tape clear plastic film to the inside of window frames during the cold winter months. Make sure the plastic is sealed tightly to the frame to help reduce infiltration.
Install tight-fitting, insulating drapes or shades on windows that feel drafty after weatherizing.
Adjust the Temperature
When you are home and awake, set the thermostat as low as is comfortable.
When you are asleep or out of the house, turn the thermostat back to save as much as 10% a year on your heating and cooling bills. A smart or programmable thermostat can make it easy to set back your temperature. But make sure the temperature is comfortable for pets! If you have a heat pump, maintain a moderate setting or use a programmable thermostat specially designed for use with heat pumps.
If you have a heat pump, maintain a moderate setting or use a programmable thermostat specially designed for use with heat pumps.
Find and Seal Leaks
Seal air leaks around utility cut-throughs for pipes ("plumbing penetrations"), gaps around chimneys and recessed lights in insulated ceilings, and unfinished spaces behind cupboards and closets. Add caulk or weatherstripping to seal air leaks around leaky doors and windows.
Maintain Your Heating Systems
Schedule routine service for home heating systems. Replace furnace and heat pump filters once a month or as needed. Find out more about maintaining furnaces or boilers and heat pumps. Regularly clean the flue vent of wood and pellet burning heaters and clean the inside of the appliance with a wire brush periodically to ensure that it is heating efficiently. Find other maintenance recommendations for wood- and pellet-burning appliances.
Reduce Heat Loss from the Fireplace
Keep the fireplace damper closed unless a fire is burning. Keeping the damper open is like keeping a window wide open during the winter; it allows warm air to go right up the chimney. When using the fireplace, reduce heat loss by opening dampers in the bottom of the firebox (if provided) or open the nearest window slightly-approximately 1 inch--and close doors leading into the room. Lower the thermostat setting to If the fireplace is never used, plug and seal the chimney flue. Install tempered glass doors and a heat-air exchange system that blows warmed air back into the room.
Check the seal on the fireplace flue damper and make it as snug as possible. Purchase grates made of C-shaped metal tubes to draw cool room air into the fireplace and circulate warm air back into the room.
Add caulking around the fireplace hearth. Find out more techniques to improve your fireplace or wood-burning appliance's efficiency. Learn tips for safe and efficient fireplace installation and wood burning.
Lower Water Heating Costs
Keep the temperature of the water heater to the warm setting (120°F). This will not only save energy, it will also help avoid scalding.
Lower Holiday Lighting Costs
Use lightemitting diode -- or "LED" -holiday light strings to reduce the cost of decorating the home for the winter holidays.
Real Estate Frequently Asked Questions
By: Collins Hannfin, P.C with chgjtlaw.com
1. If I am buying or selling real estate, at what point do I need to hire a lawyer? 3. When does a real estate broker earn his or her commission and is it a fixed amount?
For most real estate transactions, the Buyer and Seller will use a real estate broker. To sell your home, the real estate broker will want a listing agreement signed. You should consult a real estate lawyer before signing the listing agreement. It is a binding contract when signed by both parties. In the same way, the Buyer should understand the Buyer/ Broker’s form before signing. This could potentially obligate the Buyer to pay all or some portion of the real estate commission.
2. What does the multiple listing service do?
In an area where real estate brokers are members of a multiple listing service (MLS), brokers group their exclusive listings in order to give maximum exposure to any potential Buyers. When a sale occurs, the fee arrangements to the brokers are normally predetermined as contained in the multiple listing agreements. The standard real estate broker’s commission is six percent of the purchase price, however, the broker’s commission is open to negotiation. The broker is normally entitled to a real estate commission when he or she has procured a ready, willing, and able Buyer. The broker’s commission is paid out of the Seller’s proceeds at closing.
4. What is a binder?
A “binder” or offer to purchase is a written agreement entered into between the Buyer and the Seller. A binder deposit, normally one percent of the purchase price, is tendered from the Buyer to the Seller. The offer to purchase is designed to hold the property from sale pending the preparation by Seller’s counsel of a formal contract. In some areas in Connecticut, the Buyer proceeds immediately to an offer/contract provided by a real estate broker. It is definitely advisable to have this document reviewed by an attorney if there is not going to be a formal contract.
5. At what point is a binding formal contract of sale entered into by the Buyer and the Seller?
After the offer to purchase or binder is entered into, the next step is for the Seller’s attorney to draft a formal contract of sale. This contract is sent to the Buyer’s attorney. It describes the property and contains the necessary terms of sale in order to provide a valid and enforceable contract. Moreover, the Buyer is normally required to pay further deposit monies at the signing of the contract. A total of ten percent of the purchase price is the standard down payment.
6. What does the Seller of the real estate have to disclose to the Buyer about the condition of the premises?
There have been recent developments designed to achieve full disclosure by the Seller. The Seller must provide the Buyer with a signed property disclosure report prior to entering into the contract. However, the Buyer is still responsible to uncover any and all problems regarding the condition of the property. The Buyer should arrange for a professional building inspection, and review the results of this inspection prior to entering into the contract. Examples of some common inspections are: pest, radon, septic, well water, lead, and building.
7. Is a title search necessary and who pays for it?
After the contracts of sale are entered into, the Buyer’s attorney conducts a title search. This is prudent because the title search discloses the previous owners of record and other interests, including mortgages, judgment liens, and other encumbrances. In the event title problems are discovered, they must be resolved in order to ensure good and marketable title. The Buyer pays for the title search as a part of the services rendered by his or her attorney.
8. Do I need to purchase title insurance, and if so, what does it cover?
Title insurance is required by lenders to be purchased by the Buyer at closing. Title insurance provides two types of coverage. First, it will pay to legally defend the insured’s title, and, secondly, it will pay the cost for the removal of a defect in title on behalf of the insured to the extent of the policy limits. Title insurance protects the Buyer from hidden defects not revealed in a title search, such as lost or forged deeds, deeds executed by incompetents, mis-indexed deeds, or improperly probated wills.
9. What is a mortgage commitment letter?
The mortgage commitment letter is the most important document a borrower receives from the lender prior to closing. It informs the borrower of the loan application approval and the commitment of the funds for the loan. There are often conditions outlined in the letter that require fulfillment prior to or at the closing of sale. The commitment should also set forth the basic terms of the loan, as well as the fees associated with the lender and charges to the borrower.
10. What happens at the closing?
The final stage of the real estate transaction is the closing. This is the stage at which the parties sign all documents in connection with the sale and mortgage and the balance of the purchase price is paid to the Seller. The Seller produces all documents necessary for the title transfer and delivers a deed conveying title to the Buyer.
We have built a strong reputation as an outstanding mortgage brokerage firm, serving the lending needs of real estate professionals, individual homebuyers and current homeowners throughout the state.
We're a full service mortgage broker with an experienced staff offering expertise in every area of mortgage lending. We have access to a full range of mortgage sources and all of our lending specialists are dedicated to finding the right loan-with the best rates, terms and costs-to meet your unique needs. But that's just the beginning of our service. Throughout the lending process, we provide regular loan updates and progress reports so you always know the status of your loan.
We provide local customized service and have access to some of the lowest rates and fees in the marketplace while providing transparency, exceptional client support, and a streamlined closing process. Thank you for visiting New England Residential Finance, LLC. We look forward to putting our mortgage service to work for you!
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MICHAEL ROUSSEAU
NMLS ID #36474
Michael has been in the mortgage lending business for more than 20 years, he is an experienced loan professional that is dedicated to providing honest and straightforward guidance to those looking to purchase, renovate or refinance their home. Michael has worked in many areas of the mortgage business and has an expansive knowledge of the loan process from application to closing. Michael is the owner of New England Residential Finance, LLC located in Wolcott, CT where he manages the daily operations of the business, assists clients through the entire loan process as well as lead a successful sales team of mortgage originators.
NICHOLAS MINICUCCI NMLS ID #741584
With more than 20 years in the mortgage industry, Nick has a extensive knowledge of all aspects of the mortgage business. Before joining New England Residential Finance, LLC (NERF, LLC) in 2015 as a Mortgage Processor, I was a Mortgage Loan Originator for Webster Bank for 13 years. I then became a licensed Senior Mortgage Loan Officer for NERF, LLC in November 2016. I am knowledgeable in both conventional and government lending and I am committed to helping all clients achieve the dream of home ownership or refinancing their current home. When I am not working which isn't often, I am a proud father of 2 boys. I spend my free time I have raising my two sons. I have a 20 year old son who is currently in college at Johnson & Wales in Rhode Island studying to become an anesthesiologist. My youngest son, who is 10 years old is in 5th grade. He keeps me busy with doing anything outside sports related and when not outside we are usually off to arcades, trampoline parks or playing video games.
