Arizona Rental Rental Housing Journal - February 2015 by Professional Publishing, Inc

Rental Housing Journal Arizona

February 2015 - Vol. 7 Issue 2

2. Instant Tenant Screening Reports & FCRA Accuracy Requirement 3. Afraid to Admit that You Don’t Understand Social Media? 4. Dirty Little Secrets of Family Business

5. 5 Basic Fundamentals For Property Managers and Landlords 7. Staying Safe While Showing Property 9. The Coach – Your Voice Carries The Words of 10,000 Leases! 10. Secret Shopper

WWW.RENTALHOUSINGJOURNAL.COM • PROFESSIONAL PUBLISHING, INC

A Monthly Circulation To More Than 10,000 Apartment Owners, Property Managers, On-Site & Maintenance Personnel

Vacation Rentals – Make It Simple for Your Guests By Alan Langston, Executive Director AZREIA By Denise M. Holliday & Allyssa B. Birnley, Hull, Holliday & Holliday, PLC

hether you have a doubt on whether or not an action qualifies as an immediate, or if your situation qualifies as a fair housing issue, etc., Attorneys Denise M. Holliday & Allyssa B. Birnley of Hull, Holliday & Holliday, PLC agree that the best course of action when in doubt is “call your attorney”. Rental Housing Journal asked Attorney Holliday & Birnley: As an Arizona landlord tenant attorney, if you were to give three pieces of advice to landlords and property managers, what would they be? Attorney Denise M. Holliday advises: 1. Make sure you keep up-to-date on the laws. Most lawsuits arise out of misunderstandings, not intentional acts.

2. Use a well-respected and standardized lease, forms and property management agreement. These have been modified through the years to help keep

riends of mine recently became a reluctant landlord. While they have another single family rental, a townhome purchased as a place for a family member to rent became a rental on the open market. They decided to rent the unit as a short-term vacation rental. Having started my own real estate investment portfolio over 30 years ago with a vacation rental, they were picking my brain about that type of property. There have been a lot changes in the vacation rental business over the last few years. The advent of Vacation Rental By Owner (VRBO) and other similar services has made it much easier to market the property. I am a routine user of VRBO, having used the service to rent properties all over the world. I like renting a house with

friends that the best experiences we had with VRBO included when the property had information packets and even small signs displayed around the property that helped us ...continued on page 11

A Dozen States Dominate Top Year-End Real Estate Markets

t appears that real estate investment has headed south for the winter, this according to yearend data compiled by Local Market Monitor, the national real estate forecaster, and HomeVestors of America (the "We Buy Ugly Houses"® people) with Texas, North Carolina and Florida ending 2014 as sure bets for single-family investment property markets. "The real estate markets that made the top 20 list for investing were chosen based on population growth and it's near cousin, job growth - both conditions ideal for investing in sin...continued on page 6

PRSRT STD US Postage PAID Sound Publishing Inc 98204

...continued on page 4

Professional Publishing, Inc., PO Box 6244 Beaverton, OR 97007

nice furnishings, in a nice area for much less than a hotel room. I really like dealing directly with the owners when finalizing a transaction to rent their property. I mentioned to my

Advertise in Rental Housing Journal Arizona Circulated to over 10,000 Apartment owners, On-site, and Maintenance personnel monthly. www. re nt a lh o u s in gj o u r n a l.co m

Call 503-221-1260 for more info.

RENTAL HOUSING JOURNAL ARIZONA

Instant Tenant Screening Reports & FCRA Accuracy Requirement

enant screening reports typically include a consumer credit report from one of the three major credit bureaus, a civil (eviction) records search and a criminal records search. More comprehensive tenant screening reports may include employment verifications, rental references and a recommendation based on the landlord's rental criteria. Tenant screening companies are specialized "Consumer Reporting Agencies" (CRA's) - as defined (and regulated) by the Fair Credit Reporting Act [15 U.S.C. § 1681e] commonly referred to as the FCRA. Section 607(b) of the FCRA requires that... "Whenever a consumer reporting agency prepares a consumer report it shall follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates." The Consumer Financial Protection Bureau is tasked with enforcement of the FCRA. Much of the focus is on accuracy, of course, since the CFPB recognizes (as Congress did when crafting the FCRA) that the banking system and,

arguably, the economy "...is dependent upon fair and accurate credit reporting". The three major credit bureaus have taken considerable fire from regulators (the Federal Trade Commission and the CFPB) as well as the media (60 Minutes - for example) - regarding the accuracy of consumer credit reports and the handling of disputes. Here is an excerpt from a previous article on the subject: "The anecdotes are compelling. Our hearts go out to those whose credit is negatively impacted as a result of identity theft or a mistake on the part of the creditor (or Furnisher as defined by the Fair Credit Reporting Act). But what is the true scope of the problem - what is the error rate and extent to which these errors negatively impact the cost and availability of consumer credit? The FTC issued its fifth interim Report to Congress regarding credit report accuracy in December 2012 as required by the FACT Act. The study sampling was 1,001 consumers and 2,968 reports (roughly three per consumer). The study found

that 6.6% of reports examined contained errors that when corrected resulted in a score increase - but only 2% of those had a score increase of 25 points or more. Only 2.2% of reports examined had credit score increases sufficient to move them to a lower credit risk classification - reduce their borrowing costs." So it might be argued that 98% of credit scores reflect the appropriate risk classification - which is not good enough, of course, if you are one of the 2%. We can and should try to do better, but the data does put the problem (and the likelihood of further improvements) in perspective. A much bigger issue in our view - one that has recently gotten the attention of the CFPB - is the accuracy of non-credit (notably public records) data. The CFPB recently settled claims with two CRA's - for returning erroneous criminal findings (false positives) which negatively impacted job seekers. The employers were targeted as well - for failing to follow the pre and post adverse action notification requirement - which, had they been followed, may have mitigated the damage.

The problem is the lack of reliable personal identifiers in the public record - forcing us to search on name alone in the case of civil (or eviction) records - name and data-of-birth in the case of criminal records. The problem is most acute, obviously, when dealing with common names. False positives have been (and continue to be) a significant problem as a result. While much has been written regarding the impact of inaccuracy on consumers, very little has been written regarding the impact of false positives on landlords and employers. Yet erroneous public records hits can be quite damaging t - causing them to deny residency or employment to otherwise well qualified applicants. Equally important, of course, is the potential for underreporting - which can have a decidedly negative impact on the business or a property. Under-reporting is a bi-product of over-reliance on instant (database) public records searches. Don't get me wrong. Database products are quite useful - in the hands of a skilled investigator - who has the ...continued on page 8

Arizona’s Leading Parking Enforcement & Towing Company • • • • • • •

Free curb painting* Free handicapped spot painting* $1000 per car Parking/Paving relocates* Licensed, bonded & insured Member of the AMA Compliance Depot approved 4 convenient storage facilities located throughout the Phoenix area

• Latest in damage free towing equipment • Free signs & property walk-through assessments • Discounted towing rates for Employees of Community & Property Management*

www.gotowppi.com

1-877-770-TOWS *Restrictions apply *Restrictions apply

8697

RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

RENTAL HOUSING JOURNAL ARIZONA

Afraid to Admit that You Don’t Understand Social Media?

View Those Sites As A Cocktail Party Where The Rules of Networking Etiquette Apply By Marsha Friedman

talk to a lot of business owners and authors who don’t “get” social media. A year or two ago when I’d speak with them, most were quick to say they didn’t understand it and didn’t need to. Today what I hear is: “I know I’m supposed to be doing that, so I have a Facebook account.” Or, “Yeah, I’ve got my teenaged nephew taking care of that.” Unfortunately, simply posting occasional announcements about upcoming sales or telling people why they should use your service or read your book is not social media marketing and it’s not helping you. In fact, if that’s all you’re doing, it could be hurting you. What’s worse, you’re not taking advantage of what could become the most powerful tool in your marketing arsenal. Why? Social media is the world’s biggest cocktail party and everyone’s there – including your competitors and your potential customers.

Correction: On page 7 of the December 2014, edition of the Arizona Rental Housing Journal, Volume 6, issue 12, the following sentence was published, “Keep in mind the act or breach of contract must occur on the premises for the immediate eviction notice to be valid.” This statement should be corrected. The Paragraph should read, “Keep in mind that the act or breach of contract must occur on or near the premises for the immediate eviction notice for the notice to be valid. It must be something that jeopardizes the health, safety and welfare of the community, its residents, vendors and/or employees.”

I first heard the cocktail party analogy from marketing guru David Meerman Scott, who used it in his best-seller, The New Rules of Marketing & PR, published in 2007. It immediately clarified for me why social media networks are marketing gold. Imagine walking into a networking party at a hotel. People are roaming around, engaging with folks they know and being introduced to those they don’t know. They’re talking about the economy, the weather, the price of milk. You get into a nice chat with someone and he asks what you do for a living. If it were me, I’d say, “I’ve got a national PR company that specializes in publicity.” The person might say, “Wow, I’ve got a friend interested in that. Let me introduce you!” The friend may or may not be present at this cocktail party. But if that same conversation happened on a social network like Facebook, that friend and dozens more would be so close by. They may actually be “listening” to your con-

versation. That’s what makes social media so much more valuable as a marketing tool. You can be exposed to thousands more potential customers than you would through traditional networking channels. How does that happen? Social media users stay connected by “following” one another. If I’m following you, I can see your conversations. Post something clever and I might share it with my followers, who may also share it with their followers. Before you know it, you and your brilliance may be exposed to hundreds of thousands of strangers. Some of them will become your followers and, voila! You have a growing audience. But it won’t happen if you don’t have a plan and don’t apply cocktail party rules of etiquette. What works on social media – and what doesn’t – are the same things that work (and don’t) when you’re networking at that hotel conference room party: Go in with a plan. If you’re going to a party to network, you

have goals. Maybe you want to find prospective clients or get people interested in your upcoming project. You identify your target demographics and learn which influencers will be at the party, such as the local media, politicians and celebrities. On social media, the world’s biggest cocktail party, making the right moves gets a bit more complicated and involves some strategizing. (My company now offers customized strategy plans that can be easily implemented by casual or newbie social media users.) Don’t stand in the middle of the room saying the same thing over and over. Repeatedly posting the same thing, like “Come in for our big sale tomorrow” or “We won Business of the Year!” is like going to a party and saying the same thing over and over. People will run from you. Instead, engage in conversations on a variety of topics. They can be related to your business or book, but in a tangential way. Someone who sells jewelry, for continued on page 11

That having been said, the last two items under “breaches that are not grounds for the notice” need to be moved up to list of “breaches that are grounds for an immediate eviction”. The statement regarding a resident’s guest causing damage or other problems which the renter has knowledge of, and has signed a crime-free lease addendum would be grounds for an immediate termination as well as off-site arrest for criminal activity. Andrew M. Hull Hull, Holliday & Holliday, PLC www.doctorevictor.com 602.230.0088

visit us at www.rentalhousingjournal.com RHJ ARIZONA FREE SUBSCRIPTION

PROPERTY NAME

NAME ADDRESS

CITY STATE ZIP EMAIL ADDRESS

PHONE

Send for your FREE subscription to Professional Publishing, Inc., PO Box 6244 Beaverton, OR 97007 • (503) 221-1260 • fax (503) 221-1545 RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

RENTAL HOUSING JOURNAL ARIZONA

Dirty Little Secrets Of Family Business

Passing Leadership Role To Next Generation Is Tricky If Path Not Carefully Planned

fter years of hard work, you’ve built the family business into a great success and you take pride in meeting the challenges that each day brings. At some point, though, the day arrives when it’s time to turn the reins over to the next generation. That can be an exciting moment or an anxiety-ridden one, depending on what has gone on before to prepare for the momentous occasion. “Laying the path to a successful family-business transition requires a bit of threading the needle,” says Henry Hutcheson, author of the book “Dirty Little Secrets of Family Business”. “On the one hand you don’t want to paint an overly rosy picture to the next generation. That could create a sense of entitlement and the false perception that running a business is easy and all you need to do is count the money and show up every now and then to check on things.” At the same time, he says, if you put too much emphasis on the difficulties of running a business and the stresses that come with it, your sons and daughters might not clamor to be first in line to take over. Ideally, it’s best to think ahead and start grooming the next genera-

tion long in advance, Hutcheson says. Give them summer jobs while they are in high school and college so they can start testing their abilities. When they join the family business full time, find initiatives for them to work on that involve group dynamics. But also hand them individual projects where they hold sole responsibility for the results. “It’s critical when you are selecting the next leader to realize that it’s not all about who will lead,” Hutcheson says. “It is also about ensuring that those who are not selected are in support of the decision and can work as a team with the new leader.” Hutcheson says there are four key ingredients to developing the right person to take over the family business. • Independence. Next generation leaders must have confidence in themselves, their thoughts and their beliefs. “Much of this can be developed while working in the family business by constructing and leading significant projects,” Hutcheson says. But one shortcut to accomplish this is to work for some other company early on. Many multi-generation family businesses like to make

that a requirement for family members. • Competence. This is more than just being able to do the work. It means developing bottom-up experience. Not just being the accountant, but being able to reconcile the accounts and perform the journal entries. Not just being sales and marketing manager, but having been on a quota and worked the trade shows. Experience doing some of the dayto-day grunt work can pay dividends down the line. • People skills. “It’s not enough to just be smart and confident,” Hutcheson says. “You need to be able to work with people.” He notes that in the book “Emotional Intelligence,” Daniel Coleman outlines two studies that measured the success of a batch of high school valedictorians and Harvard graduates. Those who were able to perceive the emotional state of others and react to it appropriately proved to be the most successful. • No special privileges. The person in line to take over the family business needs to be willing to show up to work on time, stay late, take on special projects and be measured by the same metrics as everyone else. “This will show that you are part of

Q&A

Henry Hutcheson is president of Family Business USA and specializes in helping family and privately held businesses successfully manage transition, maintain harmony, and improve operations. His newest book is “Dirty Little Secrets of Family Business: How to Successfully Navigate Family Business Conflict and Transition” (http://dirtylittlesecretsoffamilybusiness.com). He’s also quoted in “Kids, Wealth, and Consequences” and “Sink or Swim: How Lessons from the Titanic Can Save Your Family Business.” Hutcheson grew up working for his family’s business, Olan Mills Portrait Studios. He studied psychology and has an MBA from Columbia Business School, and is a popular speaker at professional, university and corporatesponsored events.

...continued from front page

you out of trouble and clarify everyone’s obligations and rights.

2. Make policies and stick to them. Make sure the staff receives the same training and that there is consistency in enforcing the policies.

3. When in doubt, pick up the phone and call a lawyer. Those few moments can save you thousands of dollars. Attorney Allyssa B. Birnley recommends: 1. Document everything! Keep a good ledger, take pictures, log all conversations with tenants, and put all agreements in writing. A well documented file makes life easier for (and us).

the team and that you want to be judged on the merits of your work, not your bloodline,” Hutcheson says. It will also help the next generation gain the respect of co-workers.

3. If you are not sure how to handle a situation, call your attorney before you take action, not after. We are here to help and it is much easier to prevent a potential problem than to have to deal with it later.

RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

RENTAL HOUSING JOURNAL ARIZONA

5 Basic Fundamentals For Property Managers and Landlords By Will Johnson Publisher

nteracting with the people who make our industry go is one of the most rewarding and interesting aspects of my job as Publisher of Rental Housing Journal. From the top executives at large management companies and apartment association leadership, to on-sites and leasing agents, to independent rental owners and industry suppliers, I’ve gleaned a lot of wonderful and sage advice about how to best run a business in the rental housing industry. Because of my position as publisher at RHJ, I am given the opportunity to pass much of this information along to others. While there are certainly complexities and nuances to being a property manager or landlord that are unique to this industry, the fundamentals of the business look a lot like any other business. Whether you’re an executive or a newbie, it’s easy to get distracted with the background noise and circumstances of the daily grind, and it’s always important to remind yourself of the fundamentals.

1. Be Organized Organization and the tools to be organized and manage your time can be very different depending on your position and the size of your company. If you’re an independent landlord, a datebook and a spreadsheet might be enough to keep your business straight and organized. If you’re part of a larger organization, you probably need a more complex system. Regardless of what tools you’re using, I suggest using the “Hit By A Bus” test to make sure nothing is slipping through the cracks. That is to ask: “If you were hit by a bus tomorrow, could someone with reasonable knowledge of your industry come in and run your business with little issue?” We all may want to seem irreplaceable in our business, and certainly nobody wants anyone to get hit by a bus, but if your business is organized well enough to pass this test, you are prepared to run your business efficiently yourself. 2. Educate Yourself Property management is an industry that requires us to continue to educate ourselves. Some certifica-

tions require people to earn continuing education credits, but even those of us that aren’t required to take classes need to keep up on current laws, issues and best practices. Thankfully, there are a lot of great avenues that folks in the industry can use to keep up. In addition to Rental Housing Journal, there are a number of great publications and websites, both local and national, where you can learn on your own time. But, I am a huge advocate of rental housing and apartment associations and real estate investor groups and their role in educating the industry through classes and education events. Just about every local area has one or more local groups, but there are a number of great national organizations as well, many of which have local chapters. National Apartment Association, IREM, NARPM and ARPOLA are a few worthwhile national groups. 3. Give Great Customer Service Sometimes, it’s difficult to remember that our tenants and residents are our customers in the same way that we are customers of the stores where we shop and restaurants where we

eat. It can be very easy to forget that their rent payments pay our bills, especially when dealing with the fires and headaches involved in providing homes for people. But, we have to rise above and treat our residents like customers in any other business. In fact, we really need to be going above and beyond – we’re providing the most basic of human needs, after all. Treat your residents’ concerns with your own genuine concern. Take their needs seriously, and always fulfill them within reason, landlord – tenant laws and industry best practices. Make sure your residents know that you value you them. Never treat your residents less than you would treat your own friends and family. It seems simple, but when residents have their needs fulfilled and feel valued, they are more likely to renew and pay more rent. It goes without saying for property managers that your owners are also customers. It can certainly be difficult to balance the needs and desires of both residents and owners, but a skilled, successful manager will find a way. Your career depends on it. ...continued on page 8

Free Estimates

t Painting, inc. n u o m Para

369-5717 2 0 6 Great Prices Interior Repaint Specialists Drywall & Texture Repairs 15+ years of Service Valleywide Roc#148170 1833 E. Baseline Rd., #262 Gilbert, AZ 85233

The Professional Approach to Apartment Inves ng Apartment Brokers • Pre-Sale Analysis • Asset Management 1031 Exchanges • Property Clinic

Arizona

•

Oregon

•

Washington

Joseph Chaplik

TUCSONFOR SALE RENTAL PROPERTIES WITH SELLER FINANCING Central Tucson- $249,900 7 Units, 5 -1 bdrm units, 2 studios 3709 E. Blacklidge Dr. 85716 Gross $34,020 year, individually metered. Owner pays only water. Longtime owner liquidating.

President / Designated Broker

480.305.5600 | www.josephbernard.net

Contact: Jade Bossert, Associate Broker successfully selling investment properties in Arizona since 1979.

Tierra Antigua Realty (520)797-6900 RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

University of Arizona Area- $198,000 3 Units 1043 E. 8th St. 85719 Great leased duplex plus SFR in need of rehab. Currently grosses $1175 per month. OWC with 25% downpayment, 6% interest, $891.00 mo. PI payment, 5 yr. balloon. Only 2 blocks to the U of A in high demand area. Convenient to the 4th Avenue Arts District & revital-

tucsonrealestate@mindspring.com 5

RENTAL HOUSING JOURNAL ARIZONA

States Dominate

...continued from front page

gle family homes," said Ingo Winzer, president and founder of Local Market Monitor. "In all of the top 20 markets, the populations increased by more than double the national average of one percent." The top 20 markets for real estate investing are: 1. Austin-Round Rock, TX 2. Houston-Baytown-Sugar Land, TX 3. Raleigh-Cary, NC 4. Nashville-Davidson-Murfreesboro, TN 5. Orlando, FL 6. Boise City-Nampa, ID 7. San Antonio, TX 8. Denver-Aurora, CO 9. Charlotte-Gastonia-Concord, NC 10. North Port-Bradenton-Sarasota, FL 11. Oklahoma City, OK 12. Phoenix-Mesa-Scottsdale, AZ 13. Seattle-Bellevue-Everett, WA 14. Dallas-Plano-Irving, TX 15. Oakland-Fremont-Hayward, CA 16. Fort Worth-Arlington, TX 17. Las Vegas-Paradise, NV 18. Salt Lake City, UT 19. San Jose-Sunnyvale-Santa Clara, CA 20. San Francisco-San Mateo-Redwood City, CA

"Texas has always been a sweet spot for real estate investing. Its economy is strong, and only getting stronger. This is spurring population and job growth, especially among younger workers looking for work in retail, business and tourism. They are looking to rent, not buy a home," noted David Hicks, HomeVestors copresident. Along with job growth and population growth, relatively low home prices is a factor making investments in single-family homes as rental properties a low risk opportunity in some markets. The average home prices in the top 10 markets are under $300,000, although the markets listed among the top 20 range from $166,000 to $844,000. Despite high home prices, a few California markets made the top 20, including Oakland-FremontHayward (15), San Jose-SunnyvaleSanta Clara (19) and the San Francisco Bay area (20). "There is definitely opportunity to strike gold in the California market for real estate investing. With some notable exceptions, they're growing again - both in jobs and in population - as is clear by double-digit home price increases," explained HomeVestors co-president Ken Channel. "But investors in these mar-

kets are likely to see more of their gain come from price appreciation and less from a long-term rental stream, because most of these markets are no longer under-priced." About the Quarterly Data: The data identifies markets that will be good rental markets and where home prices are likely to increase at a good rate over the next few years. Criteria include markets where: • The population has been growing at above-average rates (4% or better) with growth coming from people moving there in search of jobs; • The current rate of job growth of 2% or better; and • There is low unemployment, so that new jobs will be filled by people who move there, not by unemployed people who are already there. Markets are excluded that:

HomeVestors of America, Inc. Dallas-based HomeVestors of America, Inc. is the largest professional house buying franchise in the U.S., with over 56,000 houses bought since 1996. HomeVestors recruits, trains and supports its independently owned and operated franchisees that specialize in building businesses based on buying, rehabbing, selling and holding residential properties. Most commonly known as the "We Buy Ugly Houses®" company, HomeVestors strives to make a positive impact in each community. In 2013, for the eighth consecutive year, HomeVestors was among the prestigious Franchise Business Review's "Top 50 Franchises," a distinction awarded to franchisors with the highest level of franchisee satisfaction. For more information, visit www.HomeVestors. com. In 2014 HomeVestors was recognized as the 25th fastest growing franchise by Entrepreneur Magazine and number 126 in the Franchise 500 by Entrepreneur Magazine.

• Have a small population because they don't have stable economies.

RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

RENTAL HOUSING JOURNAL ARIZONA

Staying Safe While Showing Property

s people go about their every day lives, it is common to forget the potential dangers that surround us. Recent tragedies serve as a reminder to the real estate community that the career can also come with dangerous consequences, and real estate professionals must remain mindful of their safety at all times. In October of 2014, Beverly Carter, a 49-year-old wife and real estate agent was found murdered in a shallow, makeshift grave near Little Rock Arkansas. Although Carter took many standard safety measures including leaving her purse in the car to avoid being a victim of theft and informing her husband of her location, she was still a target. Her killer’s cold-blooded response to the murder, “She was just a woman who worked alone -- a rich broker.” Across the country in Portland, Oregon, a mother working at a local apartment complex was a victim in what still seems to be a random act of violence. The 29-year-old was stabbed after dark and the killer has yet to be caught. While statistically women working in property management and real estate report far more violent crimes than men, it is never safe to assume that men are always safe.

Heather Blume, a property management trainer believes the same rule applies to clients while touring homes and apartments. “Women can attack you just as easily as men can. White women just as easily as Hispanic or African American men. Just as we don't make assumptions about whether or not to rent to people based on fair housing, you must not make assumptions of your safety based on appearance.” Although realtors and property managers aren’t quite the same, both are responsible for touring their

properties with strangers, which is where the job gets dangerous. It goes without being said that it’s difficult to be fully prepared to face a potentially life threatening situation, but there are steps you can take to be better educate yourself on how to exit those situations, or hopefully avoid them all together. Property Managers who are showing apartments or condominiums can sometimes get a little peace of mind knowing there is an office filled with colleagues not too far away. A luxury most real estate

agents showing a home do not get. Having a “code” with colleagues is a good way to ask for help when a dangerous situation is arising. Blume and her colleagues use the “red folder tactic.” If a manager ever feels unsafe during a showing they can call the office and ask for the red folder to be brought to the showing, which singles that something doesn’t seem right but there is no immediate threat. If the manager asks for the Yellow folder the threat is higher and someone needs to join the showing or call back frequently to check in. While some safety precautions are specific to either a Realtor or a Property Manager, like the “red folder tactic”, there are quite a few that should be used by both. Katie PooleHussa from Smart Property Management in Portland, Oregon, broke down what she thought were five very important safety rules to remember: • Take photo ID's from all persons looking at a vacant unit. If there is an onsite leasing office, keep photo ID's in the office as a method of tracking if need be. If you do not have access to a leasing office for safe-keeping, make sure that you tell someone who, what, and ...continued on page 9

Want to build your business?

Start by building your education. An online CE platform with easy and convenient options that fit your schedule. Enroll in your real estate continuing education courses today and save 20% with promo code RHJ20.

rhj.theceshop.com | 888.827.0777

RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

RENTAL HOUSING JOURNAL ARIZONA

Instant Tenant Screening ... continued on page 2 time, tools and skills necessary to avoid underreporting and false positives. It is a sole reliance upon database solutions that is problematic due to a lack of consistency and availability of court records and the aforementioned lack of personal identifiers. Exclusive reliance on database products - without the attention of a skilled investigator inevitably results in under (or over) reporting. Over reporting suggests the CRA is either clueless or willful in their non-compliance. Underreporting suggests an acute awareness of the risk by the CRA - who then over-filters the data - resulting in missed records. Bottom Line All it takes is a few minutes and a pair of eyeballs to deliver an accurate public records search - someone with the knowledge and tools necessary to run additional searches (based on alias' and address history - disclosed and undisclosed). We know from our own experience that these additional searches account for fully one third of valid hits in our tenant and employee screening reports. Tenant and employee screening companies are required by the FCRA "...to follow reasonable procedures to assure maximum possible accuracy of the information concerning the individual about whom the report relates." Those who do not are now

paying the price as a result of legal or regulatory action or evolving reseller policy - a price previously borne by consumers and increasingly paid by landlords and employers. Talk with your tenant and employment screening company. Ask what exactly is included in the report about the source and methodology associated with their public records work. Do they put a pair of eyeballs on their reports and do those eyeballs conduct additional searches based on alias and address history some of which is undisclosed? Ask what tools they use and what steps they take to confirm a match - avoid false positives. Ask about turnaround time, but beware of those promising instant public records searches. Quality public records results can, however, be returned quickly - often within an hour or so - quick enough, certainly, given the quality difference. Paul Prudente is vice president and general manager of Moco, Incorporated, a specialized consumer reporting agency focused on delivery of quality tenant and pre-employment screening services for the rental housing industry. He has been at the helm of Moco for nearly 12 years. He is principal architect of its pioneering direct-to-consumer tenant screening facility – marketed under the MyScreeningReport.com® brand – developed in collaboration with the low

5 Basic Fundamentals 4. Surround Yourself With Great People You’re only as good as your people. How many times have we heard this business cliché? For me, in one form or another, it’s thousands. Yet, only because it’s true. Great leaders wouldn’t be great without talented and dedicated people behind them. If you’re an owner or manager, make sure you recruit, hire and retain people that are willing and capable to take your business where you want it to go. Make sure that your employees are both willing and able to perform the tasks you give them and make your company perform to the level you want it to. Don’t skimp. Always work toward goal alignment within your organization. For instance, if the goal for your company is to provide quality housing at a premium price, make sure everyone, from owner to manager to leasing agent to maintenance is doing their part and playing their role in order to achieve that goal. The same can be said for the industry suppliers and vendors you choose to work with. Whether you’re screening candidates, turning an apartment or installing a playground, the people you’re contracting with are representing you. Make sure they’re aligned with the goals of your business and delivering the service and image that you desire.

...continued from page 5 5. Keep Your Mind On Your Money (And Your Money On Your Mind) I’m dating myself, but Snoop Dogg had it right. When the rubber meets the road, we’re all in this business for the money. There may be other, more altruistic, motives, but few people would take on the headaches of property management if it weren’t paying the bills. So, work your business with the bottom line in mind. This does not mean that you should go cheap on expenses, or get greedy when driving revenue. Your decisions on both should be measured, balancing both short and long-term benefit. For instance, you might save money in the short term by doing a minimal clean and repair apartment turn, rather than a major update of the unit. But, if the other communities in your area are new or investing in major updates, that might not be the smart play. Conversely, if your building is already performing well, reasonably updated and the competition isn’t pushing the envelope, it might be worth rethinking the complete remodeling of your clubhouse. Whatever you do, just make sure you’re putting thought into the short and long term effects of your decisions on your bottom line. Will Johnson Rental Housing Journal Will@ProPubInc.com

myitzchaki@MSYLaw.com

www. re nt al h ou si n gj ou rn al .com

Arizona A monthly circulation to more than 10,000 apartment owners, property managers , on - site & maintenance personnel . to advertise with us

Call 503-221-1260. 8

RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

RENTAL HOUSING JOURNAL ARIZONA

Your Voice Carries the Words of 10,000 Leases! By Ernest F. Oriente, The Coach {Article #225…since 1995}

rom the moment you spoke your first word as a small child, your voice and the words you select are often taken for granted—a gift you use throughout your life. As leasing professionals, you know the importance of using the telephone, because this is how a majority of your future residents contact your apartment communities. In this article, we are going to ask you to capture your voice and listen closely to how you are handling each call—a powerful exercise for becoming a leasing SuperStar. Capturing your voice and words: Let’s start by agreeing that capturing your voice and hearing the words you are using to lease apartments is an important first step. As a leasing

Staying Safe

professional, how much would your leasing skills and closing ratios improve if you listened to 50 or even 100 of the most recent calls you received from future residents? Capturing your voice and listening to the words you are using to paint verbal pictures about your apartment community will have a positive impact on your leasing performance and your career in the multihousing industry. As a resident manager or property supervisor, imagine the powerful coaching you could do with/for your leasing teams, if you could hear the five best presentations this week, given to future residents? Tip From The Coach: Using the simplest of tools, place a digital

recorder next to your telephone and start the record every time a future resident calls your apartment community. This will give you the opportunity to hear your voice and listen to the words you are using to lease your apartment lifestyle. For a more powerful system, select a vendor who can help you automatically capture, save, and index every future resident telephone call. An important note for resident managers and property supervisors: you must receive written permission from your leasing teams to capture their voices and we recommend a system be used just for in-bound calls from future residents, as these are the calls that increase your occupancy and define property management suc-

cess. Learning from your voice-mirror: Once you have selected a system for capturing your leasing voice, it’s now time to learn from your powerful voice-mirror. Begin by play the recording of your calls from today and ask yourself these important questions as you listen to your voicemirror: Can I hear the smile in my voice? Was my voice too soft or too loud? Was the speed of my voice too fast or too slow? Am I proud of the way I handled the questions asked by this future resident? If I could re-do this call with the same future resident, what single improvement would I make? Now, continue this process of capturing your calls and listening to your voice-mirror for the continued on page 10

tions to include mandatory safety and self defense classes, but believes it will be worth it, even to just save one life.

By Devan Gilbert Staff Writer Rental Housing Journal

...continued from page 7

where you will be when. • Create a policy that no showings will be done after dark. In the Summer, maybe that time is 8pm. In the Winter, no showing will be done after 5pm. • Use a "buddy" system. If you have someone else available to go along on the showing, then you can use power in numbers. • When you arrive to the property, open the front door and allow the people or person to walk-thru the property on their own. Maybe you mention some points of interest for them to check out when they're inside, but other than that you will be waiting on the porch if they have any questions. • Know your surroundings. Make sure that the exterior illumination is up to par and keep trees and shrubs well trimmed. Be aware of any potential hiding spots. Most importantly, use your intuition. If something doesn't seem right then it's probably not. Jenny Johnson, a realtor also in Portland, Oregon, agrees that using a buddy system is a key factor in keep-

ing herself out of harms way, “I always have a mortgage broker or another agent do open houses with me. If there's a case I find myself alone, I always have cell phone in hand and stay close to the front door. It's important to verify all clients. Make sure they are legitimate by talking to their lender.” Supplying pepper spray is an inexpensive way to ensure you and your employees can defend yourselves if an altercation were to occur. Doorstops to prop open front doors should be brought to every showing. It is also beneficial to know key selling points of the property to point out to clients so they can guide themselves through the showing allowing you to stay by the front door. This makes it easier to escape if there is ever a harmful situation. Tracey Hawkins, a former real estate agent now teaches self-defense classes. Hawkins believes that while obtaining a real estate license and learning how to write contracts and ethic rules it should be a requirement to learn self-defense. The National Association of Relators President, Chris Polychron, believes it may take a bit of convincing to make 50 state’s licensing boards change their regula-

RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

RENTAL HOUSING JOURNAL ARIZONA

Northwest

n strong rental markets, many leasing employees are faced with the wonderful challenge of being 100% leased. Some apartments are being rented “sight unseen,” and perhaps there are only a few days in any given month where vacant apartments are available to look at before the new residents move in. For communities that have rented and done away with their model apartments, many leasing consultants are now in situations where they have nothing to show, even if they have unrented notices. The following question ex-

T Ask

Secret Shopper

presses this dilemma and the leasing consultant’s frustration: Q: Our property consistently stays full and we typically rent our notices almost as soon as they come in. When people call to inquire about an apartment and I don’t have anything available to show, I will usually refer them to our website or recommend that they call back at a later date. I don’t want to waste their time if I don’t have anything available. However, lately some callers have been pretty insistent about wanting

to come by even when I don’t have an apartment they can see. Should I really be trying to set appointments when all I can do is hand out a floor plan and give a property tour? A: This is a challenge, and yet a unique and incredible opportunity for you to highlight and sell many other aspects of your community that you might not normally focus on during an apartment tour. EVERY caller should be extended an invitation to visit your community, whether you have an apartment to show or

not. While a website is just one of many “sales tools” at your disposal, it is not the only tool you have. What about your property and the many community benefits you have to offer? Even if you work at a smaller community, you still have numerous benefits to sell. Perhaps it’s the location of your building and the many area conveniences, which no one will truly appreciate unless they make a visit and drive through the neighborhood. Maybe you have an outstanding maintenance staff that is highly continued on page 11

10,000 Leases - The Coach ...continued from page 9 next four weeks. Then, call us in 30 days at 435-615-8486 and tells us how your leasing skills and closing ratios improved. We want to hear your success stories! Tip From The Coach: As a resident manager or property supervisor, imagine how powerful it would be to have a recording collection of the best-of-the-best in telephone presentations to share with a newly hired leasing professional. These powerful telephone presentations could also be shared during weekly leasing meetings so your entire team could continue to polish their skills and refine the verbal pictures they are using to invite future residents to your apartment communities. In addition, try comparing these telephone calls to the shopping reports

used by your company—and watch to see how the scores of your leasing teams improve. Linking your voice with your leasing success: As an added bonus, companies like Who’s Calling® or Lead Tracking Solutions® will help you and your leasing teams automatically capture every in-bound telephone call from future residents and will provide you with a special index number that is spoken out by the system at the end of each call. As a leasing professional, this becomes a wonderful audio guest card which you can go back and replay right after you finish speaking with each future resident. By replaying this message right after each call, you can add any additional notes you might have missed during the original tele-

phone call. In addition, if you place this special index number on your guest card or traffic log, you can replay this saved call minutes before your appointment with each future resident! Wow! Can you imagine the response you are going to receive from future residents when you can remember the exact details of your telephone conversation from a week ago? More importantly, how will this personalized approach increase your leasing success? Tip From The Coach: As a resident manager or property supervisor, this special index number can serve a dual purpose. For example, your leasing professional, Mary, speaks by telephone to Rick Brown on Monday and schedules an appointment for a Friday morning leasing tour. Mary calls in sick on Friday so you can now ask Bill to cover for Mary and have him use this special index number to hear Mary’s original telephone call with Rick Brown. What a concept! Bill is right in step with Rick Brown, a future resident, and Bill has a better opportunity to lease a new apartment to Rick because he has the information he needs to close this sale. Want to hear more about this important topic or ask some additional questions about how to capture your voice-mirror or how to link your voice with your leasing success? Send an E-mail to ernest@powerhour.com and The Coach will E-mail you a free PowerHour invitation. Author’s note: Ernest F. Oriente, a business coach/trainer since 1995 [33,300 hours], serving property management industry professional since 1988--the author of SmartMatch Alliances™, the founder of PowerHour® [ www.powerhour.com ], the founder of PowerHour SEO [ www. powerhourseo.com ], the live weekly PowerHour Leadership Academy [

www.powerhourleadershipacademy. com/pm ] and Power Insurance & Risk Management Group [ www.pirmg.com ], has a passion for coaching his clients on executive leadership, hiring and motivating property management SuperStars, traditional and Internet SEO/SEM marketing, competitive sales strategies, and high leverage alliances for property management teams and their leaders. He provides private and group coaching for property management companies around North America, executive recruiting, investment banking, national utility bill auditing, national real estate and apartment building insurance, SEO/SEM web strategies, national WiFi solutions [ www.powerhour.com/propertymanagement/nationalwifi.html ], powerful tools for hiring property management SuperStars and building dynamic teams, employee policy manuals [ www. powerhour.com/propertymanagement/ employeepolicymanuals.html ] and social media strategic solutions [ http:// www.powerhour.com/propertymanagement/socialmedialeadership.html ]. Ernest worked for Motorola, Primedia and is certified in the Xerox sales methodologies. Recent interviews and articles have appeared more than 8000+ times in business and trade publications and in a wide variety of leading magazines and newspapers, including Smart Money, Inc., Business 2.0, The New York Times, Fast Company, The LA Times, Fortune, Business Week, Self Employed America and The Financial Times. Since 1995, Ernest has written 225+ articles for the property management industry and created 400+ property management forms, business and marketing checklists, sales letters and presentation tools. To subscribe to his free property management newsletter go to: www.powerhour.com. PowerHour® is based in Olympic-town…Park City, Utah, at 435-615-8486, by E-mail ernest@powerhour.com or visit their website: www.powerhour.com

visit us at www.rentalhousingjournal.com 10

RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

RENTAL HOUSING JOURNAL ARIZONA ...continued from front page

know how to find things, use the property easily and to its fullest. If you are renting short-term vacation property think about implementing a few things to make your vacationer’s stay easier and nicer, as well as to better protect your property. 1. Provide complete and easy to understand access instructions. If you are using lock boxes or electronic entry be sure to explain how the codes should be protected so they are not compromised. 2. Label the contents in kitchen cabinets and drawers. This makes it easy for your guests to find the items they need. It is amazing how much easier it is for your guest to put things back where they got them from. It also sends a subtle message about how seriously you inventory the contents of the unit. 3. Provide convenience items. Extra batteries for anything in the unit that is battery operated like TV remotes and flashlights. Light bulbs for all fixtures including kitchen, baths, halls, garage, patios, etc.

Label the drawer where they are located and be sure to mention in your welcome packet. 4. Special cleaning products. Okay, so your short-term guest probably won’t clean anything, but many people rent for a month or two and they will. If anyone decides to clean anything from a spill, stain on the carpet, etc. you want them to use cleaners you know won’t damage the flooring, countertops, cabinets, paint, etc. Be sure you label where the supplies are kept and, put instructions on their use and where they are stored in your welcome packet, as well. 5. Staples. Please don’t skimp on paper towels, toilet paper, soap, etc. Even coffee and filters for a couple of days is a good thing. No, I’m not saying to eat into your margin. Just let your guests get through a day or two before having to run out for normal things. 6. Operating instruction for all appliances that may be unusual. Example: Many people have never heard of an evaporative cooler

Secret Shopper...continued from page 3 visible that a prospective resident would observe hard at work when visiting your community. What about your friendly residents who are out and about? The ones who smile and cheerfully say “Hello” to everyone they meet. Have you ever considered your existing residents as a “sales tool?” Then, last, but certainly not least, there is YOU!! No website or other form of “inanimate” advertising can take the place of a warm, friendly and VERY enthusiastic person who is excited about their product and what they are doing. Of course it’s much “easier” to just refer someone to a website or encourage them to check back with you when you have no apartments to show. After all, it does “appear” that you are trying to be “helpful.” What if you extended an invitation to visit instead? You would definitely have to expend some extra time and energy and get creative to sell your product in a new and exciting way without a “visual.” Perhaps your enthusiastic personality could describe and demonstrate with such animation that you could create your own “visual?”

Of course you want to be honest about your apartment availability and not get your prospects so “worked up” that you sell them on renting an apartment that is not available for their time frame. On the other hand, maybe there is some flexibility with their move date. Remember: Part of your job as a sales person is to convince the customer that what you have to offer is worth waiting for. If you are interested in leasing training or have a question or concern that you would like to see addressed, please reach out to me via e-mail. ASK THE SECRET SHOPPER Provided by: Joyce (Kirby) Bica former owner of Shoptalk Service Evaluations Phone: 425-424-8870 E-mail: shptalk2@gmail.com Copyright Joyce (Kirby) Bica

much less how to operate one. If your unit has both an evap and an A/C, be sure to explain when to use each. 7. Entertainment equipment. If you have anything other than normal TV, be sure to explain how to use the TV, satellite, surround sound, DVD, CD, IPod, etc. All of the remotes can be very confusing and if not explained clearly, your phone is going to ring. 8. Fireplaces. Guests need to know if they can burn real wood or just the fake logs, how to use a gas fireplace and/or gas lighter. Providing the number to call to see if it is a “no burn day” could prevent an unpleasant experience with authorities. Consider putting all this on a small sign close to the fireplace. 9. Label the light switches. I know it sounds silly, but if the switches aren’t intuitive, it is a nice touch. I intentionally didn’t go into everything you need in a welcome packet, check-in/check-out procedures or providing a list of restau-

rants and things of interest in the area or the necessity of your guest being able to reach you quickly. This list is just intended to give you things to think about, so your phone won’t ring as much and your guest will want to return many times in the future. Smarter investing, Alan Langston Executive Director Arizona Real Estate Investors Association – AZREIA American Rental Property Owners & Landlords Association - ARPOLA 480-990-7092 www.AZREIA.org www.ARPOLA.org AZREIA serves its 1700+ members through chapters in Phoenix, Tucson and Prescott providing extensive market information, education, networking events and support. ARPOLA serves members in all 50 states providing assistance with ownership and operational aspects of rental property.

ON-SITE-NW SEA

VALLEY, METRO, ARIZONA APT

Salsbury Indu

Feb, Apr, Jun,from Aug, Social Media? ...continued page 3Oct, Dec instance, might share a great trick for cleaning rings.

than an old-fashioned networking cocktail party!

Marsha Friedman is a public relaBe genuine and show some tions expert with 25 years’ experience personality. At a party, you smile, developing publicity strategies for ask people questions about themcelebrities, corporations and media selves, maybe tell some jokes, if that’s your personality and the per- newcomers alike. Using the proprietary sonality you want your brand to system she created as founder and CEO of EMSI Public Relations, (www. reflect. People are drawn to people, emsincorporated.com), an award-winnot things, so let your humanity shine. But don’t try to be something ning national agency, she secures thousands of top-tier media placements you’re not. Other users will quickly annuallyMETRO, for her clients. The former figure it out and you – and your VALLEY, ARIZONA senior vice president for marketing at brand – will lose their trust. the American Economic Council, Social media is a great way to build awareness of your brand, cul- Marsha is a sought-after advisor on PR issues and strategies. She shares her tivate prospective customers and knowledge in her Amazon best-selling establish yourself as an authority. It book, Celebritize Yourself , and as a has tremendous value for anyone popular speaker at organizations with marketing needs, and it’s really Jan, May, around the country. not intimidating onceMar, you jump in. Jul, Sep, Nov, 1010 East 62nd Street, Los Angeles, CA 90001-1598 Plus, it’s a whole lot more fun Phone: 1-800-624-5269 • Fax: 1-800-624-5299

Octoberp

September

The Industry Leader in Quality 1/8 Page 4 7/8” x 3 5/8” On-Site4

Advertise in Rental Housing Journal Arizona Circulated to over 10,000 apartment owners, on-site, and maintenance personnel monthly. Call 503-221-1260 for more info.

RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015

APT

Salsbury Indu

Vacation Rental

Order Factory Direct! 1010 East 62nd Street, Los Angeles, CA 90001-1598 Phone: 1-800-624-5269 • Fax: 1-800-624-5299 11

RENTAL HOUSING JOURNAL ARIZONA

RENTAL HOUSING JOURNAL ARIZONA • FEBRUARY 2015