Rental Housing Journal Arizona December 2016

Rental Housing Journal Arizona

December 2016 - Vol. 8 Issue 12

2. Survey Reveals What Millennial Renters Want in 2017

5. Dear Maintenance Men – Water and Wax Removal

3. The Best Seasonal Bargains for Investment Housing

6. Pending Home Sales Crawl Forward in October

4. How Will a Donald Trump Presidency Impact Real Estate?

11. How to Create a Successful Property Management Team

WWW.RENTALHOUSINGJOURNAL.COM • PROFESSIONAL PUBLISHING, INC Monthly Circulation To More Than 7,000 Apartment Owners, Property Managers, On-Site & Maintenance Personnel

Renter Myths About Breaking Leases

Landlords, Property Managers Bullied and Harassed Over Rent Increases

O

ne of the frustrating aspects of property management for landlords is situations where residents look to break their lease prior to the expiration date. While there are legal ways to do this, this article will address some of the wrong ways renters try to get out of their contract.

Whatever the reason – loss of job, poor advice from someone or some organization – landlords should be aware of these creative arguments and not be intimidated by them.

The most common argument is the 72-hour or three-day cancellation period after they sign the lease. No such law exists regarding residential apartment continued on page 9

Trump Policies Could Affect New Housing Costs as New Buyers Enter the Market in 2017

By John Triplett Rental Housing Journal

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Portland landlord says he and his property managers have been bullied and intimidated over rent increases after he purchased a small apartment building and had to raise existing rents to afford his new mortgage payments.

He said demonstrators have picketed his personal residence. The have placed notices on the doors of neighbors, camped overnight on his lawn, defecated on his lawn and marched into

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

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continued on page 7

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n 2017, recent trends will reverse course as the housing market's economic recovery enters a new stage.

Renting will become more affordable, more Americans will drive to work, and the homeownership rate will bounce back from historical lows.

Millennials will play a significant role in increasing the homeownership rate.

Nearly half of all buyers in 2016 were first-time buyers, and millennials made up over half of this group of buyers.

Here is Zillow's look ahead at the 2017 housing market:

Text REALESTATE-ROI to 44222 to receive a digital copy of this year's Real Estate Opportunities in Investing (ROI) Finding Investing Success in Today's Housing Market

Zillow's 2017 Predictions 1. Cities will focus on denser development of smaller homes close to public transit and urban centers. continued on page 10

Text 51WAYS to 44222 to receive the FREE e-book 51 Ways to Increase Your Rental Property Cash Flow (And 10 Ways to Ruin It)

Rental Housing Journal Arizona

Survey Reveals What Millennial Renters Want in 2017

M

illennials recently surpassed Baby Boomers as the largest living generation on Earth, and with millions continuing to put off traditional life milestones like home ownership, property owners are taking note. To reveal just what Gen Y looks for in a rental, Schlage®, a brand of Allegion which creates technologically advanced lock products to help multi-family property owners secure and manage their units while streamlining operations, has announced the results of a nationwide survey conducted with Wakefield Research of 1,000 U.S. renters in multi-family dwellings. Results include a desire for tech upgrades and the integration of next-generation access control systems as critical elements to entice renters.

Of millennial renters who live in multi-family dwellings, 86 percent are willing to pay more for a "smart" apartment, meaning one that is equipped with automated or remotely controlled devices, compared to 65 percent of Boomers. This is big, considering nearly half of American renters in multi-family dwellings expect to be renting an apartment for the next five or more years.

"As the multi-family marketplace continues to evolve with flexibility being a key factor in most living situations, consumers can feel confident that Schlage's latest door hardware offerings are paving the way for a new era of convenience and security," said Ann Matheis, marketing director, Allegion.

"Apartments won't look the same in 10 years, from the inside or the outside, continued on page 10

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Circulated to over 10,000 apartment owners, on-site and maintenance personnel monthly

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to receive a digital copy of this year's Finding Investing Success in Today's Housing Market Rental Housing Journal Arizona · December 2016

Rental Housing Journal Arizona

H

The Best Seasonal Bargains for Investment Housing

omeUnion, a leading online real estate investment and management firm, has released a list of the biggest seasonal bargains for investment housing, and found that the winter off-peak period can be the best time of the year to acquire single-family rentals (SFRs). Nationally, the average cap rate for SFRs during the winter months was 6 percent last year, compared to 5.3 percent in the summer.

The new Seasonal Single-Family Rent-

al Investment Advantage Report also found that investors pay 7.2 percent less per square foot for the same property during the winter as they do during the spring and summer buying season.

"Based on seasonal cap rate fluctuations, our study conclusively found that early winter is the best time to acquire SFRs," explains Steve Hovland, director of research for HomeUnion. "In many metros, median home prices drop substantially during the colder months,

Metro Area

Cap Rate Increase

Temperature Spread

Pittsburgh San Francisco Milwaukee Philadelphia Chicago Columbus Boston Cincinnati Cleveland Greenville, S.C. Detroit Oklahoma City Palm Beach, Fla. Seattle Birmingham, Ala. Washington, D.C. Tampa St. Louis Jacksonville New York San Jose Houston Minneapolis Austin Portland, Ore. Salt Lake City Oakland, Calif.

Denver Baltimore Miami Dallas Orange County Phoenix Memphis Indianapolis Atlanta Orlando Los Angeles Nashville Sacramento San Antonio San Diego Las Vegas Raleigh, N.C. Kansas City Charlotte Riverside

31.4% 21.8% 19.3% 18.8% 18.3% 18.2% 18.1% 16.3% 16.0% 15.9% 15.9% 15.2% 15.2% 12.8% 12.0% 11.8% 11.7% 11.5% 11.4% 11.3% 11.1% 10.7% 10.4% 10.2% 10.2% 9.6% 9.4% 8.1% 7.9% 7.8% 7.7% 7.6% 7.6% 7.2% 7.0% 7.0% 7.0% 6.8% 6.5% 6.2% 6.0% 5.6% 4.9% 4.9% 4.8% 4.6% 3.9%

47 17 54 46 52 48 46 47 47 38 51 44 15 27 37 45 21 49 27 45 24 30 59 34 33 54 24 43 45 14 38 15 38 43 49 37 21 18 42 40 32 12 46 39 49 38 30

About HomeUnion

2016 Winter Median SFR Price $69,000 $920,000 $70,000 $127,000 $128,000 $110,000 $247,000 $74,900 $62,000 $86,250 $120,000 $85,000 $235,500 $320,000 $76,700 $255,000 $109,100 $85,000 $103,900 $310,000 $742,000 $145,100 $146,000 $219,300 $260,000 $187,500 $428,000 $283,000 $173,000 $192,400 $136,500 $615,000 $161,900 $82,400 $87,000 $104,000 $147,800 $455,000 $129,900 $260,000 $125,000 $452,000 $178,300 $147,500 $92,000 $110,000 $250,600

2016 Summer Median SFR Price $87,000 $1,200,000 $92,000 $161,300 $225,000 $149,800 $300,000 $115,000 $80,100 $140,000 $163,000 $100,000 $275,000 $437,200 $110,000 $333,300 $130,000 $105,000 $166,800 $408,000 $1,050,000 $170,000 $179,000 $257,700 $300,000 $251,500 $545,000 $335,000 $200,000 $215,400 $178,600 $716,600 $186,000 $89,400 $106,200 $117,000 $165,000 $550,000 $150,000 $306,000 $157,700 $495,000 $204,000 $180,000 $106,875 $137,000 $272,000

ing season commences.

"We also discovered that school quality isn't as important to investors in the winter: Buyers interested in neighborhoods with high-ranked schools make up a greater proportion of sales during the summer compared to the winter," Hovland adds.

Here's a complete list of the markets offering the biggest discounts during the winter months: 2016 Average Winter Rent $1,000 $3,900 $1,100 $1,420 $1,460 $1,200 $2,020 $1,090 $1,100 $1,130 $1,210 $1,060 $2,130 $1,910 $970 $1,800 $1,160 $1,050 $1,160 $2,090 $3,350 $1,500 $1,380 $1,560 $1,660 $1,260 $2,510 $1,810 $1,520 $1,850 $1,440 $2,900 $1,110 $980 $1,060 $1,130 $1,240 $2,380 $1,220 $1,440 $1,300 $2,290 $1,250 $1,200 $970 $1,130 $1,590

2016 Average Summer Rent $1,180 $4,360 $1,190 $1,520 $1,560 $1,350 $2,130 $1,200 $1,150 $1,220 $1,390 $1,130 $2,280 $2,090 $1,050 $2,020 $1,210 $1,100 $1,250 $2,300 $3,740 $1,610 $1,490 $1,680 $1,760 $1,380 $2,700 $1,970 $1,660 $1,990 $1,530 $3,250 $1,200 $1,040 $1,100 $1,180 $1,280 $2,530 $1,300 $1,570 $1,380 $2,460 $1,310 $1,350 $1,080 $1,170 $1,670

www.HomeUnion.com

HomeUnion is an online real estate investment management firm. Based in Irvine, Calif., it provides all the services needed for individuals to invest remotely in single-family rental (SFR) properties. The company uses a combination of research and data-driven proprietary analytics to incorporate over 110 million homes and 200,000 neighborhoods into their database, and then delivers its solutions

Rental Housing Journal Arizona ¡ December 2016

while rent losses were marginal for investors. Winter is the perfect time to acquire solidly performing SFR assets in cold-weather metros such as Pittsburgh and Chicago, as well as in the Sun Belt markets of Jacksonville, Tampa and Greenville, S.C. These markets all ranked among our top 20 metros." For properties that need a little TLC, a winter purchase can give contractors ample time to bring the property up to a level that maximizes rents as the spring rent-

to an on-the-ground infrastructure that currently serves 18 locations. HomeUnion's role spans the lifecycle of the investment transaction: identifying sound investments, handling all aspects of acquisition, maximizing income, protecting asset value, and selling the asset when the time comes.

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Rental Housing Journal Arizona

How Will A Donald Trump Presidency Impact Real Estate?

By Zachary Harrison, President, Platinum Drive Realty

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number of clients have asked me how a Trump presidency could impact property values and real estate markets. Putting aside the politics of the election, real estate is a critical sector of the economy that affects buyers, sellers, renters, landlords and homeowners.

The unexpected election of Donald Trump to the presidency will have profound implications in the United States and around the world. From a high level, a centerpiece of Trump's campaign has been curbing immigration and deporting undocumented immigrants.

However, cross-border transactions and international buyers have been key to the bull market in U.S. luxury real estate from coast to coast for many years.

A 2016 study by the National Association of Realtors found that international buyers typically purchase more expensive properties. Furthermore, from April 2015 through March 2016 overseas buyers purchased $102.6 billion of residential real estate with New York being one of the five largest markets for purchases by overseas buyers.

International buyers and investors have been instrumental to the success of new construction projects, including Trump's own endeavors, accounting

fall in November, traditionally a quieter period on the U.S. real estate calendar.

Will a Trump presidency lift real estate to even greater heights? Once the surprise of the election results wears off, the hope is that there will be a stable real estate framework in which buyers, sellers and renters can best operate.

Only time will tell, but it will be interesting to see how everything plays out. for approximately 15% of the New York buyers in recent years.

An environment of mass deportations and highly restricted visas could trigger a chain of events that could reduce real estate investment and increase construction costs. The construction labor market is already tight and eliminating millions of workers from this sector could yield labor shortages and impede building activity thereby increasing both labor and construction costs. As a result, developers could bestow the cost implications upon homebuyers or alternatively pull back on projects.

A decrease in the labor pool could also shrink the U.S. economy. A 2015 study by the American Action Forum found that deporting 11.2 million undocumented immigrants would reduce real GDP by $1.6 trillion. A decline in

economic activity could cause real estate prices to dip, resulting in higher rental yields and position buy to rent investments as more attractive.

What about interest rates?

The Federal Reserve has signaled a rate increase in December although Dow futures were down 800 points the evening of Trump's election before rebounding in the days that followed.

Market volatility could influence the Fed to delay a rate hike extending what has been a stronger than usual real estate market this fall. However, treasury yields have been higher on expectations of tax cuts, infrastructure spending, and inflation, which may lead to higher rates and deficits.

Fortunately, the timing of the presidential election and subsequent results

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Rental Housing Journal Arizona ¡ December 2016

Rental Housing Journal Arizona

DEAR MAINTENANCE MEN: Water and Wax Removal

By Jerry L’Ecuyer & Frank Alvarez

Dear Maintenance Men: I have a bathroom sink that is slow draining. I have already snaked the drain and found no stoppage. When I remove the pop-up assembly and have an open drain, water whooshes down with no problem. However, with the popup in place, water backs up into the sink and drains very slowly.

Paul Dear Paul: Most bathroom sinks have an overflow hole near the top edge of the sink.

This hole serves two purposes; 1: Acts as a safety drain to keep the sink from overflowing should the water rise above a certain level in the sink. 2: The overflow hole also serves as an air vent for the sink when the water levels are above the pop-up plug. The overflow hole allows air to escape through the drain and the water to evacuate more efficiently.

What has happened is hair, toothpaste, grime etc. have built-up and sealed off the overflow drain where it exits just below the pop-up assembly plug. Most snakes are too big to go through the overflow drain. Alterna-

tively, a speedometer cable will work great or even a long zip tie will work.

Push the cable or zip tie down through the overflow hole at the top of the sink and push any gunk out into the drain.

Use water to help push the debris out the overflow drain, a funnel works great to direct a good flow of water. If you cannot get the overflow to drain, disassemble the main drain assembly to gain access to the overflow drain exit.

Once the overflow drain has good airflow, the sink should drain a bit faster. If this does not solve the problem completely, look at restricting the water flow coming out of the faucet. Use a restrictive aerator to cut down on the GPM of the faucet.

Dear Maintenance Men: My property has 100-gallon gas fired water heating that serves four units.

It is about 8 years old. The tenants are complaining of very little hot water. I have checked the tank and the thermostat is working, the water is hot. Are my residents making up stories? What am I missing?

Thorne

Dear Thorne: The water heater may need a bit of maintenance. The first thing to do is clean out the sediment at the bottom of the tank. This will require a shutdown of the heater for a couple of hours and some hands and knees work. Most 100-gallon gas water heaters have a clean-out port at the front of the tank.

The port is either round or oval. Be sure to get a new clean-out port gasket before starting this job. Once the water is drained and the port opened, remove

all the sediment from the tank. You can expect to haul out one to two buckets of calcium buildup. (Sediment removal should be done once a year.) Removing the sediment will greatly improve the heating efficiency the water heater. Because of the age of the tank; while you have the port open, check the inlet dip tube and the anode rod inside the tank.

If the anode rod is corroded, replace it by pulling it out from the top of the tank and inserting a new one. The anode rod continued on page 9

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Rental Housing Journal Arizona

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Pending Home Sales Crawl Forward in October

ending home sales were mostly unchanged in October, but did squeak out a meager gain for the second consecutive month, according to the National Association of Realtors®.

The Pending Home Sales Index,* a forward-looking indicator based on contract signings, inched up 0.1 percent to 110.0 in October from a slight downward revision of 109.9 in September.

With last month's small increase, the index is now 1.8 percent higher than last October (108.1).

Lawrence Yun, NAR chief economist, says October's minuscule uptick in contract activity nudged pending sales up to their highest level since July (111.2).

"Most of the country last month saw at least a small increase in contract signings and more notably, activity in all four major regions is up from a year ago," added Yun. "Despite limited listings and steadfast price growth that's now carried into the fall, buyer demand has remained strong because of the consistently reliable job creation in a majority of metro areas."

On the topic of housing supply – which has been grossly inadequate all year – Yun explains that the unwelcoming but expected seasonal retreat in new listings is now arriving at a time when price growth remains around triple the

pace of wages and properties continue to sell at a much faster pace than a year ago1. Furthermore, highlighting the heightened imbalance of supply in relation to demand, 40 percent of sales in October sold at or above list price, an increase from 33 percent last October2.

"Many of the successful shoppers in October likely had to move fast and outbid others for the few listings available in the affordable price range," explained Yun. "Those obtaining a mortgage last month were likely the last group of buyers to lock in a rate near historically low levels now that rates have marched to around 4 percent since the election."

With contract activity holding steady, Yun expects existing sales to close out 2016 at a pace of around 5.36 million, which surpasses 2015 (5.25 million) and is the highest since 2006 (6.48 million).

"Low supply has kept prices elevated all year and has put pressure on the budgets of buyers," added Yun. "With mortgage rates expected to rise into next year and put added strain on affordability, sales expansion will be contingent on more inventory coming onto the market and continued job gains."

The PHSI in the Northeast nudged forward 0.4 percent to 96.9 in October, and is now 3.9 percent above a year ago.

In the Midwest the index rose 1.6 per-

cent to 106.3 in October, and is now 1.2 percent higher than October 2015.

Pending home sales in the South declined 1.3 percent to an index of 120.1 in October but are still 0.8 percent higher than last October. The index in the West climbed 0.7 percent in October to 108.3, and is now 2.5 percent above a year ago.

The National Association of Realtors®, "The Voice for Real Estate," is America's largest trade association, representing 1.2 million members involved in all aspects of the residential and commercial real estate industries.

1According to October's Realtors® Confidence Index, the median days on the market in October was 41 days, which is down considerably from a year ago (57 days).

2Also according to data from October's Realtors® Confidence Index. *The Pending Home Sales Index is a leading indicator for the housing sector, based on pending sales of existing homes. A sale is listed as pending when the contract has been signed but the transaction has not closed, though the sale usually is finalized within one or two months of signing.

The index is based on a large national sample, typically representing about 20 percent of transactions for

existing-home sales. In developing the model for the index, it was demonstrated that the level of monthly sales-contract activity parallels the level of closed existing-home sales in the following two months.

An index of 100 is equal to the average level of contract activity during 2001, which was the first year to be examined. By coincidence, the volume of existing-home sales in 2001 fell within the range of 5.0 to 5.5 million, which is considered normal for the current U.S. population.

NOTE: NAR's fourth quarter Housing Opportunities and Market Experience (HOME) survey will be released on December 14, Existing-Home Sales for November will be reported December 21, and the next Pending Home Sales Index will be December 28; all release times are 10:00 a.m. ET. Information about NAR is available at www.realtor.org. This and other news releases are posted in the "News, Blogs and Videos" tab on the website. Statistical data in this release, as well as other tables and surveys, are posted in the "Research and Statistics" tab.

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Rental Housing Journal Arizona · December 2016

Rental Housing Journal Arizona

Landlords, Property Managers ...continued from page 1 his property managers’ offices scaring the staff, according to his spokesman, John McIsaac.

The landlord, Landon Marsh, raised rents “only to the lower end of current market rates in Portland,” said McIsaac in a recent interview.

McIsaac said the rent increases came after Marsh purchased the small apartment complex, did substantial work to improve the condition of the building and raised rents to cover his costs and mortgage. Unfortunately the rent for one tenant went up by 40 percent and the tenant complained to the Portland Tenants United group.

“It was built about seven years ago.

And it needed some repairs just from wear and tear. The tenants asked him to make these repairs and he said, ‘Yes I will do that.’ “ “So he set to making the repairs. But he had bought the building at market value. And market value right now is a hell of a lot higher than it was seven years ago – it’s a lot higher.

“He said that he was going to have to raise the rent. But he said he would keep the rents – and he stuck to this – at the very low end of market rates. So he’s not a profiteer by any stretch of the imagination,” McIsaac said. He said in his

Telling the landlords’ side of the story McIsaac said he is speaking out because many in the landlord and property management industry do not feel their side of the story has been told, and that more attention has been focused on what the activists’ demonstrations, and what the tenants say.

“I represent the landlords and property managers who do not want to have exorbitantly high rents, we want more housing stock,” McIsaac said.

“In Portland, 85 percent of the landlords are small operators. They might have their retirement tied up in these properties, but they don’t make a ton of money off of them. So the stereotype is that all of the property owners are huge, out-of-state multimillion-dollar concerns. That is not the case. A lot of these property owners have day jobs,” McIsaac said.

opinion, “This guy is a liberal, progressive classic Portlander. He is a caring, altruistic, sensitive man.”

The story of one small landlord McIsaac said that with the hysteria over rent increases, “the activist group has targeted a couple of landlords in particular. They are not going after the big guys who own thousands of units.

They are going after the little guys who own like 20 units.

“And this one guy, Landon Marsh, who is my client, is in the hospital interior-design business. He is a one-man consulting business. He does not do property development for a living. He has investment properties. They are small ones. All three buildings he owns combined make up 20 units.”

Where this all started with apartment building purchase “He bought one building around seven or eight months ago out in a semi-blighted part of East Portland, a working-class area,” McIsaac said.

Group pushing rent control and end to no-cause evictions for Portland Portland Tenants United is a growing tenants union dedicated to organizing tenants to take action to strengthen and enforce tenants’ rights and protections, according to their Facebook page.

At a recent press conference, Portland Tenants United and City Commissioner-elect Chloe Eudaly, promoting something called “Keep Portland Housed,” called for a freeze on rent and an end to no-cause evictions in Portland until there is a policy in place to improve conditions for renters.

Leader says group wants municipal disobedience and rent control “We’ve been in an officially declared housing emergency for over a year.

Despite that, tenant protections – the most critical component to preventing homelessness – have not meaningfully improved, and conditions continue to worsen,” Eudaly said in a press release. “My election, and the passage of Portland’s housing bond, present a clear and obvious mandate to City Council to act.”

Eudaly admits state laws prohibit local rent control measures. But she wants city commissioners to commit “municipal disobedience,” do it anyway and fight the resulting lawsuits, she told the Portland Tribune.

Portland Tenants United is focused on lowering the eviction rates in Portland by organizing tenants to vocalize their concerns. Gabriel Erbs, organiz-

Rental Housing Journal Arizona · December 2016

continued on page 8 7

Rental Housing Journal Arizona

Landlords, Property Managers ...continued from page 7 er for the group, insists the fight is far from over, according to a report on Portland Patch. "Tenants can be evicted, for whatever reason or no reason at all, at the landlord’s whim," he said.

Landlord and tenant activists have clashed Tensions escalated late in 2016 at the Portland Art Museum during an awards ceremony. Multifamily NW, an association promoting quality rental housing, was holding its annual ACE awards ceremony for its members when protestors from Portland Tenants United showed up.

Dozens of protesters gathered across the street from the museum. It didn’t take long for tempers to flare, according to koin.com.

The television station reported that, “Tensions were high. Some choice words were exchanged as well as some apparent shoving as protesters came face to face with ceremony attendees. Shouts calling the multifamily association attendees ‘parasite’ and ‘bloodsucker’ rang out from protesters.”

A small group of protesters stormed past security into the museum to dis-

rupt the event. They were soon removed by security, according to katu.com.

Deborah Imse, executive director of Multifamily NW, said in response to the protest, “Over the past few years, rents in Oregon have risen while incomes have lagged behind, creating an urgent housing crisis. In order to thrive, the region needs to work together to create more quality housing options for families of all incomes.

“With demand for housing continuing to increase, we must take action to reduce rental costs by increasing the variety of housing types available to people of all incomes and creating more subsidized affordable and market-rate units,” Imse said in the statement.

Property management groups say more apartment units needed Any solutions to the Portland housing issue, property management organizations say, should be market-based.

A spring 2016 apartment report released by Multifamily NW says that “Portland’s current development pipeline includes an impressive 21,600 proposed units.”

“More housing is the solution, and our priorities are to help increase supply and educate politicians on the fact that simply adding fees and making business harder has the reverse effect on the problem they want to solve,” Multifamily NW’s Imse wrote in an email to the Portland Mercury.

“As the organization representing property owners and managers, Multifamily NW has adopted a solutions-ori-

ented approach to address the housing shortage. The market data we collect, along with reviews of affordable housing policies across the country and the experience of our members, have shown us the best way to create affordability in the housing market: adopting proven strategies that add to the housing supply,” Imse wrote in an article on Oregonlive.com in early 2016.

Barrier to constructing new apartments need to be removed “To increase the overall housing supply, we need to remove barriers to building. This includes updating zoning codes to allow for a wider variety of housing types at a range of price levels.

“At the same time, we should streamline the process for development review and permitting new construction while retaining standards for high-quality buildings. Under the current process, approvals can take a year or more, add-

ing to project costs and delaying the construction of much-needed market-rate and affordable units,” Imse wrote.

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Locks Tenant(s) certify that the above pet(s) are the only pet(s) on the premises. Tenant(s) understands that the additional pet(s) are not permitted unless the landlord gives ten Ceilings ant(s) written permission. Tenant(s) agree to keep the above-listed pets in the premises subject to the following terms and conditions: Electrical Outlets

1) The pet(s) shall be on a leash or otherwise under tenant’sGarbage control Cans when it is outside the tenant’s dwelling unit.

TV Antenna/Cable 2) Tenant(s) shall promptly pick up all pet waste from the premises promptly.

3) Tenant(s) are responsible for the conduct of their pet(s) Fireplace at all times.

4) Tenant(s) are liable for all damages caused by their pet(s).

5) Tenant(s) shall pay the additional security deposit listedCleanliness above and/or their rental agreement as a condition to keeping the pet(s) listed above.

6) Tenant(s) shall not allow their pets to cause any sort of disturbance or injury to the BEDROOM other tenants, guests, landlord or any other persons lawfully on the premises.

1 7) Tenant(s) shall immediately report to landlord any typeWalls of damage or injury caused by their pet.

Windows 8) This agreement is incorporated into and shall become part of the rental agreement exe -cuted between the parties. Failure by tenant to comply with any part of this agreement Blinds/Drapes shall constitute a material breach of the rental agreement.

_____________________________ Landlord

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______________________________ Floor Tenant ______________________________ Light Fixtures Tenant Doors/Woodwork

Locks ©2011 NO PORTION of this form may be reproduced without written permission.

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sales@rentegration.com 02

the tenants union has refused conversations and any negotiations that are not absolutely in their favor,” he said.

“And they have a couple of politicians on their side,” McIsaac said. “Some politicians support no-cause evictions and rent control. But they don’t know the facts. If they did, they would not do it.

The Portland Tenants Union is funded by the national Service Employees International Union (SEIU). No-cause evictions are No. 1 and rental control is No. 2 but I think there are other things lurking underneath if they can get these laws passed.

“If you have rent control you cannot improve your buildings. You have to be an altruistic millionaire to improve a building with rent control because rent is where you derive your income.”

Advertise in Rental Housing Journal Arizona www.rentalhousingjournal.com

Electric Outlets Light Fixtures

Essential Services Plumbing Heating Electricity Hot Water Smoke Detectors

©2009 NO PORTION

do NoT put over a busy background

“So it is interesting here in Portland the media has not jumped on him, they have been extremely neutral on him.

The head of the tenants union has taken it upon herself to negotiate with landlords on behalf of the tenants and she is not a lawyer, not a property owner, she’s just an activist,” McIsaac said.

Challenge of buying apartments at market rates “The bottom line is, if somebody buys a new rental property at market rate from somebody else who owned it for 10 years, the owner is going to sell it at market value. The new owner is going to have to raise the rents to make the monthly mortgage. If you do away with no-cause evictions, then you also do away with the ability to evict bad actors who are drug dealers or domestic abusers, because that is what the law exists for,” McIsaac said.

“His (Marsh’s) other properties have long-term tenants – his other two properties – and so it’s just a crazy, uncomfortable situation. I think the property managers and the landlords are really willing to work with tenants because of the type of city we have here – but

Light Fixtures

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No lawsuits have been filed.

“But they have come up with some non-factual statements about how he has treated tenants and what he has said to them. And he has bent over backwards, and so has the rental company, to make it easier for tenants,” McIsaac said.

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Out

(G)Good (F)Fair (P)Poor

Landlords Trying To Do The Right Thing Caught in the Middle McIsaac said Marsh tried to work with the existing tenants on payment plans and provide plenty of lead time and help moving if they decided not to pay the rent increases. Most tenants decided to stay, he said.

Activists marched into property management office Activists were protesting at one event and then went over to the office of the property management company Marsh had been using to handle his rentals.

“They marched into the A&G Rental Management LLC office and intimidated the people working there. Drove some of them from the main area back into their offices. They had to lock themselves in their offices. And the principals were not in the office at the time, so they basically attacked the support staff – not physically – but screaming, bullhorns, stomping, just marching through this office. It’s not very big, maybe a grand total of 1,000 square feet. So 30 of them came in there so it was pretty unpleasant,” McIsaac said.

be reproduced without

written permission.

Rental Housing Journal Arizona · December 2016

Rental Housing Journal Arizona

Dear Maintenance Men ...continued from page 5

Renter Myths About ...continued from page 1

is a sacrificial zinc rod that helps keep the tank from corroding. The second item to check is the cold-water inlet dip tube. Cold water entering the heater is routed to the bottom of the tank by the dip tube. If the tube is corroded, broken or missing, the tank will develop hot and cold areas, leading to complaints about short-term hot water. The dip tube is located inside the cold-water inlet pipe. Replacements for both the anode rod and dip tube can be found at most plumbing supply houses.

leases. Once signed, the lease is a binding contract. If the renters have buyers’ remorse and change their minds, they are still bound to the lease. If they move, they are liable for the remainder of the lease or until the apartment is re-rented, plus any lease break fees and other damages.

Another common misconception renters have is if they arrive at movein and the unit is not ready, they can break the lease. However, the Arizona Residential Landlord and Tenant Act ARLTA) says otherwise. A.R.S. § 33-1362(b) states: B. If the landlord fails to deliver constructive possession to the tenant because of noncompliance with section 33-1324, rent shall not abate.

Tenant may proceed with the remedies provided for in section 33-1361.

Dear Maintenance Men: How do I remove candle wax or gum from my rental unit’s carpet?

Janet Dear Janet: The best way to remove candle wax from a carpet is to use a hand held clothes iron. Put an absorbent paper towel over the wax and heat the area with a hot iron. The paper towel will absorb the wax as it melts. Be careful not to burn the carpet as an iron can melt certain carpet fibers and scorch others.

Start on the lowest setting. Remove any left over stain by blotting the area with a small amount of dry-cleaning solvent. (Dry-cleaning brand names to look for: Guardsman Dry Cleaning fluid, Woolite Dry Cleaning Secret, Dryel or any dry fabric cleaner and in a pinch; lighter fluid.) Also, blotting with a mild detergent mixed with warm water may

work. Make sure the detergent does not contain any alkaline or bleaches.

Remove gum by either freezing the gum and removing it by pieces or using peanut butter to loosen the gum’s grip on the carpet. A product known as “GooGone”, found at Home Depot, may be used to remove gum, tar, grease and glue. Use Goo-Gone sparingly Bio: If you need maintenance work or consultation for your building or project, please feel free to contact us. We are available throughout Southern California.

For an appointment please call Buffalo Maintenance, Inc. at 714 956-8371 Jerry L'Ecuyer is a licensed contractor & real estate broker. He is currently on the Board of Directors and Chairman of the Education Committee of the Apartment Association of Orange County. Jerry has been involved with apartments as a professional since 1988.

Frank Alvarez is the Operations Director and co-owner of Buffalo Maintenance, Inc. He has been involved with apartment maintenance & construction for over 20 years. He is also a lecturer & educational instructor. Frank can be reached at (714) 956-8371 Frankie@BuffaloMaintenance. com For more info please go to: www.

BuffaloMaintenance.com

In other words, renters must pay rent and serve the landlord a non-compliance notice and give the landlord the opportunity to complete the requested repairs.

The final excuse residents try to use to break their lease is failure to provide a copy of the lease when they sign it, failure to provide a move-in/ moveout inspection report, failure to inform them that they can obtain a free copy of the ARLTA from the Arizona Department of Housing, or failure to give them a copy of their lease with all the blanks filled in.

The parts of the ARLTA that apply to these arguments are the following found in A.R.S. § 33-1321(c) and § 331322(b) and (e): C. With respect to tenants who first occupy the premises or enter into a new written rental agreement after January 1, 1996, upon move in a landlord shall furnish the tenant with a signed copy of the lease, a move-in form for specifying any existing damages to the dwelling unit and written notification to the tenant that the tenant may be present at the move-out inspection. Upon request by the tenant, the landlord shall notify the tenant when the landlord's move-out inspection will occur. If the tenant is being evicted for a material and irreparable breach and the landlord has reasonable cause to fear violence or intimidation on the part of the tenant, the landlord has no obligation to conduct a joint move-out inspection with the tenant.

B. At or before the commencement of the tenancy, the landlord shall inform the tenant in writing that the

Arizona residential landlord and tenant act is available on the Arizona department of housing's website.

E. If there is a written rental agreement, the landlord must tender and deliver a signed copy of the rental agreement to the tenant and the tenant must sign and deliver to the landlord one fully executed copy of such rental agreement within a reasonable time after the agreement is executed. A written rental agreement shall have all blank spaces completed. Noncompliance with this subsection shall be deemed a material noncompliance by the landlord or the tenant, as the case may be, of the rental agreement.

As stated above, none of the alleged violations are grounds to terminate the lease. At best, the landlord would have ten (10) days to correct the deficiencies under the noncompliance notice.

Example Consider the following example: Renter Michael Jackstoned falls on hard times, loses his house, and must move into an apartment. He applies for residency and is accepted at Neverland Apartments, along with his two friends, O.J. Simpleton and Robert Flake. All three sign the lease, but do not receive a copy of it from manager Justice D. Nyed, who still needs to get the owner’s signature.

O.J. Simpleton injured himself playing with his knife and loses his job. Robert Flake accidentally shoots himself while cleaning his gun and also loses his job.

Looking for a way out of their lease because they can’t afford the rent, Michael Jackstones tells the manager that since they don’t have a copy of the signed lease, the contract is broken and they can move without penalty.

The owner of Neverland Apartments sues and wins. Judge Royal Payne states that the lease was not broken and the residents gave the landlord no notice to fix the problem, so they are liable.

Andrew M. Hull, Esq. Hull, Holliday & Holliday, PLC www.doctorevictor.com 602.230.0088

Advertise in Rental Housing Journal Arizona www.rentalhousingjournal.com Rental Housing Journal Arizona · December 2016

9

Rental Housing Journal Arizona

Trump Policies Could Affect ...continued from page 1 2. More millennials will become homeowners, driving up the homeownership rate. Millennials are also more racially diverse, so more homeowners will be people of color, reflecting the changing demographics of the United States.

3. Rental affordability will improve as incomes rise and growth in rents slows.

4. Buyers of new homes will have to spend more as builders cover the cost of rising construction wages, driven even higher in 2017 by continued labor shortages, which could be worsened by tougher immigration policies under President-elect Trump.

5. The percentage of people who drive to work will rise for the first time in a decade as homeowners move further into the suburbs seeking affordable housing – putting them further from adequate public transit options.

6. Home values will grow 3.6 percent in 2017, according to more than 100 economic and housing experts surveyed in the latest Zillow Home Price Expectations Survey.

National home values have risen 4.8 percent so far in 2016.

Statement from Zillow Chief Economist Dr. Svenja Gudell: "There are pros and cons to both existing homes and new construction, and the choice for home buyers can often be difficult. For those considering new construction in 2017, it's worth considering the added cost that may come amidst ongoing construction labor shortages

Survey Reveals What Millennial ...continued from page 2

that could get worse if President-elect Trump follows through on his hardline stances on immigration and immigrant labor. A shortage of construction workers as a result may force builders to pay higher wages, costs which are likely to get passed on to buyers in the form of higher new home prices.

"Those looking for more affordable housing options will be pushed to areas farther away from good transit options, in turn leading more Americans to drive to work.

"Renters should have an easier time in 2017. Income growth and slowing rent appreciation will combine to make renting more affordable than it has been for the past two years."

Zillow

Zillow® is the leading real estate and rental marketplace dedicated to empowering consumers with data, inspiration and knowledge around the place they call home, and connecting them with the best local professionals who can help.

In addition, Zillow operates an industry-leading economics and analytics bureau led by Zillow's Chief Economist Dr. Svenja Gudell. Dr. Gudell and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research. Zillow also sponsors the quarterly Zillow Home Price Expectations Survey, which asks more than 100 leading economists, real estate experts and investment and market strategists to predict the path of the Zillow Home Value Index over the next five years. Zillow also sponsors the bi-annual Zillow Housing Confidence Index (ZHCI) which measures consumer confidence in local housing markets, both currently and over time. Launched in 2006, Zillow is owned and operated by Zillow Group (NASDAQ: Z and ZG), and headquartered in Seattle.

Publisher Will Johnson – will@propubinc.com Designer/Editor Kristin Flores – kristin@propubinc.com

and with our long-established position in both the residential and commercial sectors, we have a unique vantage point that helps bring targeted, outcome-driven innovation to multi-family facilities because electronic access is the future."

Results of the industry survey include six key insights into the millennial renter.

• Lock Down: Millennials want tech upgrades right down to the locks, as more than 61 percent are likely to rent an apartment specifically because of electronic access features, including keyless entry doors. In fact, 55 percent are likely to pay more for an apartment that had "high-tech" door locks compared to ones that did not.

• Smart Renters: On average, millennial renters would pay about a fifth more for smart home features.

• Tech vs. Parking: 44 percent of millennials would give up a parking space to live in a "high-tech" apartment.

• Advanced Security: 63 percent would move out of an apartment due to lack of security.

• Work/Rent Balance: 64 percent feel that being close to work is more important when choosing an apartment than being close to friends and family.

• The Future: 45 percent of renters feel that physical door keys will be obsolete in the next 10 years.

this new offering provides multi-family property owners with highly scalable, efficiency-boosting capabilities with a greater appeal for residents.

Schlage Control™ Smart Deadbolts and Schlage Control™ Smart Interconnected Locks are available in the Greenwich and Addison styles, with finish options including Satin Nickel, Aged Bronze, Satin Chrome and Bright Chrome. To learn more about Schlage and its offerings, please visit www.

Schlage.com/Multifamily. *Survey Methodology This survey was conducted by Wakefield Research among 1,000 U.S. renters in multi-family dwellings, between Oct. 12-24, 2016, using email and an online survey. Results of any sample are subject to sampling variations. For the interviews conducted in this particular study, the chances are 95 in 100 that a survey result does not vary, plus or minus, by more than 3.1 percentage points from the result that would be obtained if interviews had been conducted with all persons in the universe represented by the sample.

About Allegion™ Allegion (NYSE: ALLE) is a global pioneer in the field of safety and security. We keep people and their property safe, wherever they are, bringing together simple solutions and advanced technology.

Allegion is a $2 billion company, with products sold in almost 130 countries. For more, visit www.allegion.com.

Schlage continues to innovate with smart multi-family technology, including its latest launch, Schlage Control™ Smart Interconnected Lock, recently named a "Top 101 Product" for 2016 from Building Design+Construction Magazine. Featuring ENGAGE™ Technology,

Advertising Sales Will Johnson – will@propubinc.com Terry Hokenson – terry@propubinc.com Larry Surratt – larry@propubinc.com

Rental Housing Journal Arizona is a monthly publication published by Professional Publishing Inc., publishers of Real Estate Opportunities in Investing & Real Estate Investor Quarterly

www.rentalhousingjournal.com The statements and representations made in advertising and news articles contained in this publication are those of the advertiser and authors and as such do not necessarily reflect the views or opinions of Professional Publishing, Inc. The inclusion of advertising in this publications does not, in any way, comport an endorsement of or support for the products or services offered. To request a reprint or reprint rights contact Professional Publishing Inc. PO Box 6244 Beaverton, OR 97007. (503) 221-1260 - (800) 398-6751 © 2015 All rights reserved.

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Rental Housing Journal Arizona

How to Create a Successful Property Management Team

By Mary Girsch-Bock, wwwpropertymanager.com

W

hat is the magic formula for a successful property management team? Like any other workplace, a property management office functions much more efficiently when employees function as a team with each member contributing their particular talent and expertise.

When an office functions as a true team, everything runs smoothly. When it doesn’t, even the slightest bump in the road can quickly become a pothole.

If you have staff members fighting, tenants complaining, and work not being completed properly (or at all) you staff is not functioning as a unified team.

So how do you do it? How do you get the right team in place, and ensure that they’re working together? Here are a few suggestions: Start with hiring the right people.

This may sound simple, but having the right group in place goes a long way to creating a strong working team. (It

Want to build your business?

Start by building your education.

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helps to start by identifying what you are looking for as a company in your team members–what are the characteristics you find valuable?)

When you interview potential staff members, interview them holistically.

In other words, interview the whole person, not just the person on the resume. That can mean taking the time to introduce potential employees to key staff members to see how they interact.

Find out what their personal goals are; not just what they did at their last job.

Do they work better alone? Do they enjoy being part of a team? None of these attributes means that they’re the right fit for your office, but knowing these things up front helps you and your team make a hiring decision that will be the most beneficial to the needs of you and your office.

Offer educational and advancement opportunities. While opportunities may be limited in smaller offices, those managing multiple properties can mentor and groom selected employees for management opportunities, either at that property or another. While not all employees will likely take advantage of the opportunity, those that do will be more likely to stay.

Cross train your staff. Most employees are eager to learn or perfect new skills and you just might be surprised at the results Have an open door policy and truly honor it. While many managers may profess an open door policy, few actually put those words into practice. Take the time to listen to your employees without judgment and without repercussions.

Creating a strong group of employees that work well together will go a long way towards building a team of individuals that together create a positive environment for all.

Advertise in Rental Housing Journal Arizona Circulated to over 10,000 apartment owners, on-site and maintenance personnel monthly

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Rental Housing Journal Arizona · December 2016

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Rental Housing Journal Arizona

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Rental Housing Journal Arizona ¡ December 2016