Arizona Rental Housing Journal Decemeber 2017

Rental Housing Journal Arizona

December 2017 - Vol. 9 Issue 12

2. How to Raise Money for Multifamily Property Investing Do You Give Feedback People Can Actually Learn From?

3. 4 Roof Preventive Maintenance Steps You Should Take Before Winter

4. Dear Maintenance Men 5. Which Rental Property Flooring is Right for Your Tenants?

9. How Do You Practice Compliance in Apartment Leasing and Management?

10. Is the Outdoor Faucet at Your Rental Property Winter-Proof?

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

Multifamily Research Market Report

Outsmarting Jack Frost Are Your Properties Ready for Winter?

4Q17 – Phoenix Metro Area

Marcus & Millichap

Strong Household Formation Supports Healthy Demand onstruction remains vigorous.

Robust housing demand in Phoenix will prompt the delivery of more than 6,000 rentals for a third straight year. The submarkets of Central Phoenix and South Scottsdale have received a large portion of the metro’s overall completions in the previous two years with approximately 3,400 total units delivered. Looking ahead, North Tempe/University and North Central Phoenix have the most development underway with 2,600 and 2,100 units, respectively, coming to market in the next 24 months. The largest project is

C

by Christian Bryant

E

ven though the current legislative climate for landlords in Oregon is very distracting, don’t let it keep you from protecting your property and preparing for winter. If they take the proper steps before winter comes, many landlords will avoid damage, unnecessary after-hours repair expenses, and lawsuits. These expenses can soar up into the tens of thousands of dollars. Next to improvements that will increase rent, and properly managing your tenant, investing in repair and maintenance avoidance will have the largest impact to your longterm bottom line. If you manage your own properties, you really can’t afford to skip these steps. And if you have a professional manager, you need to verify that their weatherization policies and procedures mimic these guidelines. To be as prepared as possible, there are three areas to focus on: the property, the

the 480-unit Biltmore Gateway that will deliver in late 2017 on 24th Street near Camelback Road.

Surplus of Class A units boosts vacancy. South Scottsdale and the western submarkets of Avondale, Goodyear and West Glendale have experienced strong rent growth in recent months, while others, such as Central Phoenix, have seen minimal or declining rents.

Here, average effective rent is almost 25 percent higher than the metro average, while vacancy is about 400 basis points above the metro rate. The high number of Class A units delivered in Central Phoenix over the past few years has increased vacancy in this area. Metrowide, vacancy will continue to adjust

with an ample amount of apartments slated for completion in the next two quarters.

Investment Trends • In the past, this market has attracted many West Coast investors seeking to escape the compressing yields of their local markets. Approximately one-third of buyers in the past five years came from California.

• Although sales velocity was slightly down in the past 12 months ending in September compared with the previous annual period, it has increased by 50 percent in comparison with the yearlong span ending in September ...continued on page 6

Cash Flow from Car Charging

...continued on page 8

by Peter Vierthaler

I

f you own an apartment building with parking spaces, you have just struck oil. New technology creates significantly more electric capacity to charge cars in your garage or lot.

Car charging is a new source of revenue. Parking spaces with car chargers rent for up to $50 more per stall. Early adopters of car charging will realize

more income and less vacancy. The cost of electricity can be billed back to the tenants.

Electric and chargeable hybrid cars are a rising share of the automobile market. Are you ready for them and the power that they will need to charge?

Have you received inquiries yet from tenants looking to charge cars? If not, you soon will.

Adding capacity for car charging can

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

be expensive, ranging from $30,000 to $100,000 depending on a number of variables: the size of your building, location of the electric strike, size of the main feed conduit, size of the electric room and the number of chargers wanted. With adaptive power allocation, you don’t need to bring in additional power.

Your existing capacity is all you need. .

Adaptive power allocation means redirecting the available unused tenant electric capacity to car chargers. It redirects power instantaneously to and from chargers as available. If a stove is off that power can be used to charge cars. This was never possible before.

Suddenly every building has capacity to charge five, ten, twenty or partially charge up to a 100 vehicles using existing power.

Drivers simply enter their car type, miles desired, and time of departure.

The load management controller in conjunction with smart chargers does the rest. This comprehensive system bills vehicle owners for consumed power, it ...continued on page 4

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Rental Housing Journal Arizona

How to Raise Money for Multifamily Property Investing

by Vinney Chopra

How multifamily syndication financing works You can raise money from others to begin your multifamily property investing. But remember, there are specific more government regulations that dictate what you can, and cannot do, when raising money from others for your multifamily property investing.

So do your due diligence and consult a good attorney so you stay out of trouble.

When you invest in multifamily properties and raise money from others to fund it, you enter a whole new world of government regulations that dictate what you can and cannot do while raising that money

M

ultifamily p r o p e r t y investing requires raising money because it typically involves acquiring apartments that cost more than a single-family homes you buy for real estate investment. Veteran multifamily investor Vinney Chopra has some ideas for you to think about to raise money for multifamily investing.

I love multifamily property investing and I love to help others who would like to learn how to invest in this area that I have been enjoying success in for more than 20 years.

Multifamily property investing provides nice, steady cash flow and checks every quarter to investors in many cases. Many of my students ask how to get started in multifamily property investing and how do I raise money for it?

In raising money, it is important to have an understanding of the SEC (Securities Exchange Commission) rules and regulations. Second, it is important to build a strong team with at least one high net worth partner. Then, add a supporting team including a real estate attorney, a syndication attorney, real estate brokers in the emerging markets you are planning to invest in and a loan broker. I have the attitude that we are serving many through multifamily syndication process – the valued investors, residents and staff.

I love to speak to larger groups of investors and help them explore commercial investing from the funds in self-directed IRAs, 401(k) and other tax deferred alternatives. I believe it’s a great art in understanding the psychology in having the investors invest with you. You need experience and a good track record to share with them.

Four types of multifamily property investing financing

A recent article in Fits Small Business sets out four common multifamily financing options available to real estate investors who are looking to purchase or renovate a property with between 2 – 20+ units. Each of these loans have their own unique terms, rates, and qualifications.

The four multifamily financing option are: • Conventional Mortgage – Terms between 15 – 30 years. Loans are capped at 80% LTV and typically have interest rates between 4% – 6%.

• Government-Backed Loan – Terms between 5 – 35 years. LTV capped at 87%. Interest rates between 3% – 6%.

• Portfolio Loan – Terms between 3 – 30 years. LTV of up to 97%. Interest rates from 3.70% – 5.70%.

• Short-Term Multifamily Financing – Terms between 1 – 3 years. Interest rates of 4% – 12%. Monthly payments are typically interest-only.

Changes happening in capital raising activities “Banks are really pulling back,” Da-

vid Hanchrow, CIO of Bristol Development Group, said in a panel discussion according to Multifamily Executive.

“The biggest challenge for us is the amount of equity we’re having to raise for each deal,” as banks that issued 75% loans a few years ago are now offering loans at 60% or 65%. Kirk Motsenbocker, CFO of JPI/TDI, said that “smaller regional banks are seeing an opportunity, with the big banks pulling back, to grab some market share.”

So smaller regional banks or boutique banks are one potential source of financing. This is the avenue I have taken quite a few times. The local banks close to the apartment community, know the location, the neighborhood and the potential that a savvy buyer can do to add value. This happened to me four times in recent months. One such instance happened when I purchased a not-sogood looking asset of 160 units in small city of Lake Jackson, TX. Ultimately we won a top award from the city after we changed it for the better for our valued residents by adding many great amenities such as those below.

Advertising for investors “In the wake of the JOBS Act, when advertising for investors became legal under Regulation D, Rule 506(c), crowdfunding platforms like have sprung up to meet investor demand for access to the types of investments that institutions, pension funds and other larger entities have secretly enjoyed for years. No matter their size, in today’s market investors are looking for high cash returns, tax advantages and equity growth. Many also prefer the hard asset of real estate, as opposed to stocks, bonds, etc., and the ability to use leverage in their deals to enhance investor returns,” writes attorney Kim Lisa Taylor on her blog.

I have been very fortunate to work with Kim for the last 10 years. She is a top professional syndication attorney. My team and I have done 26 syndications so far and are moving into a $50 million fund in 2018. The market is getting tougher and it’s wise to have the money committed/raised as the opportunities arise that are conducive to syndication.

You see the cash-on-cash needs to be in the 12-12.5% range for the deal to be ...continued on page 11

Do You Give Feedback People Can Actually Learn From?

by Ellen Clark

T

he Grace Hill training tip of the week focuses on providing feedback that is useful to your tenants, leasing agents and property managers.

Did you ever have a teacher who marked up your essays with feedback

2

than days or weeks after the learner responded to the question or submitted the assignment. An advantage of some online learning formats is that you can provide feedback immediately. If that’s not possible, just try to follow the rule, “the sooner, the better.”

like, “unclear”, “poor word choice” or “watch your sentence structure”?

If so, you might remember feeling a bit helpless, wondering what the comments meant and what to do with them.

Comments like these may have given you some information about your performance, but did they really help you become a better writer?

When we are learning new things, it is important to get timely information about what we are doing right or wrong and why, along with information about how to improve. This is called feedback, and it is a critical component of improving learner performance.

learners?

Here are some tips!

"We want your feedback!" megaphone Using explanatory feedback is key to provide learners with guidance on how to move forward.

• In addition, to “correct” or “incorrect”, provide an explanation of why the response is correct or incorrect.

Refer back to key points or examples from the training. Explanation is most useful when it provides learners with an understanding of where they are, and some guidance on how they can move forward.

• Display the question, response, and feedback together. Having to flip between the question and the feedback can add cognitive load to learning. If possible, position the feedback so that the learner can see the question, his or her response, and the feedback at the same time. This is most feasible when using online formats but think

How can you create meaningful feedback for your

• Be timely. Feedback is most effective when it is given immediately, rather

...continued on page 9

Rental Housing Journal Arizona · December 2017

Rental Housing Journal Arizona

4 Roof Preventive Maintenance Steps You Should Take Before Winter

by Eric Skoog

B

efore the weather gets worse, here are four roof preventive maintenance steps from a roofing expert you should take as a landlord or property manager to get your rental housing or apartments ready.

1. Gutters and downspouts These are areas of specific concern whether in areas of snow and ice or heavy rain. Any structure that has gutters and downspouts should have those two areas checked.

Leaves, debris, children throwing balls up on the roof - any of these can plug up gutters and downspouts. When that happens you have improper drainage. With improper drainage, there is a greater chance for water to back up beneath the roof system. Also remember you tend to get ice damming along eaves in cold country, and this can be minimized with proper drainage and installation of electric tape.

Gutters and downspouts are your most important roof preventive maintenance-related item to check every fall.

Make sure gutters and downspouts are open and clean.

2. Clean out roof valleys The second area for roof preventive maintenance I would look at would be the valleys on pitched roofs.

Especially with tile and shake roofs, valleys tend to get filled up with debris.

A valley is a junction where two slopes of a roof meet and water drains from the roof down that junction. If there's any debris in the valley, water tends to be diverted sideways beneath the roof's surface. When water gets under slate, shake, tile, or even shingle, it travels until it finds a drainage point, which might be a nail hole or some other minor penetration where it can get in and cause quite a bit of damage.

So number two would be clean out the valleys.

3. Look around any roof penetrations The third area in roof preventive maintenance I would think about would be any penetration in the roof.

You have roof penetrations for kitchen and bathroom exhaust fans, soil stacks, and perhaps even roof-mounted air conditioning units or evaporative coolers.. Anything that penetrates through the roof has the potential to

leak because you're breaking the roof system. You want to check around those penetrations to make sure that the roof sealant or any gaskets are in good shape, re-sealing or replacing as needed.

4. Check around parapets An additional area for roof preventive maintenance that I would consider a concern is parapets.

Whether on a flat roof, surrounding a flat roof, or on a pitched roof where a wall runs into that roof and terminates you have the potential for leaking. The termination with the pitched roof or surrounding the flat roof may be an issue, but it might also be that the parapet could have gaps or cracking in it which provide ways for water to get into the system and travel.

A parapet is a wall that is built up higher than a roof level and surrounding a roof level. On a flat roof, you could walk on the roof and see the wall around the roof. Or, you might have a parapet that terminates into a pitched roof such as shingle, tile or metal.

Parapets generally go around flat roofs and many buildings have both flat roofs and pitched roofs for architectural or aesthetic effect as well to reduce construction costs. Anytime you have a wall that's running around a roof or terminating into a pitched roof you have a potential for leaks. So those parapets need to be checked just to make sure there isn't any cracking or material that's come off the walls leaving gaps where water can get in or ice or snow.

Wherever the wall terminates and meets with the roof's surface it needs to be checked to make sure that there's no break in the roof's surface.

Those would be the four primary routine roof preventive maintenance items that I would check with any roof every fall and it really doesn't take that much time to do it.

Evaluate the age of your roof The other significant factor with any roof system is age.

With age comes exposure to the sun, to the weather, and over time no matter how good a roof system you have or how good roof preventive maintenance you have, it's going to break down.

The unfortunate part with any pitched roof system whether shingle, shake, slate, or metal, there isn't any material that we can apply over that roof system to extend the life of it. What we have to do with those roof systems is lift them and replace them or at least replace the underlayment. The underlayment typically used for this purpose is known as #30 felt. With more recent development of synthetic underlayments and rubberized products, which hold up quite well over time with exposure to heat, and cold, and water, there are alternatives to felt underlayments.From right to

left, Lt. Tim Ferracci, Chief Explosive Ordnance Disposal Jeff Reinhofer, and Constructionman Apprentice Nicole Ramnes remove shingles from the roof of the home of an Iraq war veteran's widow's home. Photo by Kelly E. Barnes.

How do you know when I roof is too old to fix anymore?

I will give you couple of examples.

If you take your standard shingle roof, for the first five to ten years you really should have little or no maintenance with a shingle roof.

Starting at about year ten you probably are going to want to reseal around all the penetrations, and then as time goes on maybe about year 15 you're going to start noticing around the perimeter of the building, or if you have gutters or downspouts you're going to start noticing in the gutters or at the base of the downspouts, evidence of granules.

Those granules are the surface of the shingle roof starting to come off, and as they deteriorate with age the shingles will lose more granules. That's your indication that something's happening.

Next, with a shingle roof you'll start to see the shingles start to curl. That's a sign of age. Or if you walk on the shingle roof you'll notice that they're starting to crack because they're getting brittle. That's an indication to you that you need to start seriously considering when you're going to replace that roof.

It's a little more difficult with a metal roof, or slate, or shake, or tile because you can't see the underlayment. With wood shake, you start to notice over time that the shakes are getting brittle and flying off the roof. They turn from the bright shiny yellowish tan to a dark gray dull looking product as they age, and ultimately they get brittle. You'll see your roof starting to look kind of ragged, shakes may start to warp and curl up, there may be gaps due to missing shakes. That's a clue to you that there's a problem.

In a wetter climate, you may see significant mold or algae growth on the roof. Particularly in areas like Portland or Seattle with plenty of rain, a shake roof will last probably about 25-30 years, but at some point you're going to have to replace it.

Can satellite dishes cause roof leaks?

Satellite dishes are the bane of my existence.

We get calls and I'll give you an example of two calls I've had over the years.

One was with a flat roof. It happened to be a polyurethane foam roof that we had installed. I received a service call about five years after we installed it. The ...continued on page 8

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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 pop-up 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. Alternatively, 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.

Car Charging ...continued from 1 then notifies via a user’s smartphone the end of a charging session. For planning purposes, a tenants charging history is used to predict future charging requirements.

The price of extended range electric vehicles (over 200 miles on a charge) has now come down to $35,000. For a $35,000 base price a driver can buy a Chevy Bolt or a Tesla 3. For $25,000 they can buy the lower priced Nissan Leaf with a range of 150 miles. This puts electric vehicles within reach of most middle class buyers and each of these buyers will need charging. 13 new entries of plug in cars just this year put electric vehicles in the price range for a much higher percentage of your tenants. Market penetration is increasing rapidly. Tesla is ramping up production and has over 500,000 reservations, the Chevy Bolt is selling at 1150 per month and the Leaf about 1200 per month.

Plug-in and electric cars are expected to increase market share from 3% to 15% in just a few years.

4

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 shut-

down 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 is a sacrificial zinc rod that helps keep the tank from corroding. The second ...continued on page 10

Advertise in Rental Housing Journal Arizona Pollution and environmental concerns have the largest economies in the world investing in electric vehicles. Be prepared for those tenants looking for the convenience and value in having car charging stations available near their residence. The demand is coming.

The winners will be those that control infrastructure cost through adaptive power implementation, add value to their buildings, and are prepared for the next generation of car buyers.

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

Peter Vierthaler has been a multifamily real estate developer for 30 years, with a focus on apartment repositioning. He has taken a strong interest in clean technology and how it can be applied to the multifamily industry. Peter can be reached at peter@northwestpartnersllc.com or at 206-498-4708.

•

Call 503-221-1260 for more info

Rental Housing Journal Arizona · December 2017

Rental Housing Journal Arizona

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Which Rental Property Flooring is Right for Your Tenants?

hich type of rental property flooring is right for you and your tenants to both help with maintenance and be attractive to get new tenants? The maintenance checkup this week provided by Keepe focuses on flooring to be sure you are your protecting your investment and income as well as keeping your tenants happy..

Flooring is the first thing that rental applicants see during a showing of a rental property so which rental property flooring is right?

Flooring choice for rental properties is the equivalent of curbside appeal for homeowners.

Renters are motivated by different attributes than homeowners, so luxury or cost are not the only attributes to consider when making a choice of flooring.

It is also important to consider which segment of the rental market the property at hand is targeting.

For example, it may not make sense to install low-cost vinyl flooring if the location and finish of the property is more attuned to the high-end renter.

That said, when it comes to flooring options at rental properties, there are a few technical attributes that are important to consider.

affordable choice Laminate flooring cons • Softness: Laminate floor is not a soft surface.

• Eco-friendliness: Laminate is not an eco-friendly option being manufactured with toxins and resins. So, you can have off-gassing with laminate flooring not recommended for people with allergies and respiratory problems.

• Durability: Laminate floors can scratch easily, and damaged by heavy furniture. The only way to repair it is by changing the affected area.

• Contribution to the resale value of your house: Laminate flooring can be neutral and somewhat detrimental to your house value when reselling it.

Carpet flooring pros • Variety: you can find a large variety of carpeting for your house, in terms of colors, materials, etc.

• Softness: carpeted floors are soft and suitable for children and the elderly.

Rental property flooring basics There are four basic types when you are selecting flooring: • Hardwood • Laminate • Carpet • Vinyl Also, you can take into consideration various criteria when comparing the available flooring options: • Variety • Ease of installation • Maintenance Softness • Durability • Resale or releasing value • Eco-friendliness • Affordability Here are some pros and cons for different rental property flooring options Hardwood flooring pros • Variety: You can find hardwood flooring in a variety of colors, patterns (strip flooring, plank flooring, parquet flooring), width and thickness.

• Maintenance: Hardwood is easy to maintain and it can be re-sanded and refinished several times to remove stains and scratches. With a new refinish you can change the color of your hardwood using a different stain.

• Durability: Hardwood floors are durable, so it cannot be damaged easily.

You can also place heavy furniture on it without any damage. Contribution to the resale value of your house: Hardwood floors increase the sale value of your house a lot, so if you think that you will sell the house in a few years, it’s worth installing hardwood floors.

Harwood flooring cons • Ease of installation: Hardwood is not as easy to install as the other options, so a professional is needed to do the job and it is an expensive installation because it includes laying the floor, sanding, staining and finishing.

• Softness: Hardwood floors are not

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soft so it might not be the first option if you have kids and/or older people in the house.

• Eco-friendliness: Cutting forests is not an eco-friendly activity, so if you are green and love nature hardwood floors are not a choice.

Some people prefer them at least for the bedroom areas due to this quality.

• Eco-friendliness: depending on the materials used they can be eco-friendly.

• Affordability: Hardwood is an expensive choice.

• Affordability: the price of carpeting can vary a lot but you can find nice options that are not very expensive.

Laminate flooring pros • Variety: Since laminate flooring mimics hardwood, you can also find it in a variety of colors, patterns types, width and thickness.

Carpet flooring cons • Ease of installation: Professional installation is required for carpet installation, but the cost of installation is cheaper than hardwood floors.

• Ease of installation: Laminate floors (especially the snap-on ones) are easy to install so this can be an excellent DIY project.

• Maintenance: Carpets get very dirty and it is not easy to clean and maintain, especially if your renter has pets.

On move-out, professional carpet cleaning is a must.

• Maintenance: Laminate floors are easy to clean and require low maintenance.

• Affordability: Laminate flooring is an inexpensive choice. Prices may vary with quality but all in all it is a more

• Durability: Carpeted floors are durable because they are soft.

• Contribution to the resale value of your house or releasing of your rent...continued on page 11

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info@rentalhousingjournal.com Rental Housing Journal Arizona · December 2017

5

points above the metro rate. The high number of Class A units delivered in Central Phoenix over the past few years has increased vacancy in this area. Metrowide, vacancy will continue to adjust with an Housing ample amount of apartments slated for completion in the Rental Journal Arizona next two quarters.

$989 per month. This gain is slightly lower than last year’s boost of 6.3 percent.

Market Report 4Q17 ...continued from 1

Investment Trends

Apartment Cap Rate

Average Rate

ly stable over the last year,

its benchmark short-term

• Although sales velocity was slightly down in the past 12 months but upward movement in rate in three times compared in sevenwith the ending September previous annual periTreasury with ratesthehas amplified months and signaling an- in comparison od, it has increased by 50 percent yearthe expectation gap other before the end2014. The amount of trades inbetween long spanrise ending in September buyers and years, sellers.with Glendale have steadily in recent of the and year,Tempe long-term rates risen first-year yields in Glendale points. have remained stable.rising The20 basis • The capital markets environ-

9%

Market Report

6% 3% 0%

Phoenix Metro Area

01

03

05

07

09

11

13

15

the 10-year U.S. builtment • A yield numberon of value-add complexes in thecontinues 1990s andto early be highly Treasury bond remained inGilbertcompetitive.

2000s in areas such as Tempe, and Chandler posted Government first-year yields the mid-4 to low-5 percent range. Metrowthe lowto inmid-2 percent ide, the throughout Phoenix apartment market produced initial returns range the third slightly above 6 percent. quarter of 2017. The Federal

17*

Pricing Trends

Strong Household Formation Reserve wants $12012 months through 3Q17; Supports Healthy Demand * Cap rates trailing 10-year Treasury rate through Oct. 20.

to normalize monetary policy and, in $90 addition to raising its funds Construction remains vigorous. Robust housing lending) demand rate, in (or overnight 2014. The $60 amount of trades percent to $108,200 per door.

Phoenix will prompt the delivery of more than 6,000 rentals for a has announced it will begin in Glendale and Tempe have In particular, the value of third straight year. The submarkets of Central Phoenix and South to taper its balance sheet by $30 in recent years, steadily risen Class C units rose 18.3 perScottsdale have received a large portion of theanmetro’s allowing initial overall $10 bilwith first-year yields in Glencent during the same period completions in the previous two years with approximately 3,400 $0 lion in securities to mature dale rising 20 basis points. to $80,500 per unit.

13 14 15 units16delivered.

17* Looking ahead, North Tempe/University and total without reinvestment. By • A number of value-add com- North • First-year yields have for the Class Central Phoenix most development underway with reducing its acquisitions of 2,100experienced units, respectively, plexes built in the 1990s and 2,600 C and assets the coming to market in the next securities, 10-year Treasury largest is the 480-unit Biltmore Gateway early 2000s in areas such as 24 months. largest The change in project the last rates should drift upward, in latewith 2017average on 24th Street near Camelback Road.

Tempe, Gilbert and Chan- that will fourdeliver quarters thereby widening the spread dler posted first-year yields returns dropping approxibetween short- and longof 20 Class A points units boosts in the mid-4 to low-5 percent Surplus mately basis into vacancy. South Scottsdale term rates. the low-6 western submarkets of Avondale, Goodyear and West range. Metrowide, the Phoe- and the percent realm.Outexperienced strong rent growth inin recent months, • Increase interest rates nix apartment market pro- Glendale look:have Velocity will increase suchwho as Central Phoenix,over havethe seen minimal or decourse of the year, duced initial returns slightly whileasothers, investors have held clining rents.

Here, effective pushing rent is almost percent up the25cost of capabove 6 percent. their assets for average five to seven higher thanexchange the metro into average, while vacancy is about 400 basis ital. While commercial real years newer Deal Flow Remains points above the metro rate.

The high number of Class A units deestate fundamentals remain properties or a value-add oplivered in Central Phoenix over the past few years has increased Stable Amid Growing strong, rising costs associatportunity vacancy in this area. Metrowide, vacancy will continue to adjust Economy ed with debt financing will with an ample amount of apartments slated for completion in the By WILLIAM E. tighten the spread between • In the last 12 months, the two quarters.

HUGHES, Senior Vice cap rates and lending benchaverage price per unit in the next marks. This environment Phoenix market rose 17.4 President, Marcus Average Price per Unit (000s)

Multifamily 2017 Outlook

Sources: CoStar Group, Inc.; Real Capital Analytics

7*

17*

6%

Year-over-Year Change

8%

Metro

2%

Construction: Development is down in the last four quarters compared with the previous 12-month period, which had 8,000 completions.

will be completed

100 basis point

Vacancy: The large number of deliveries in recent years and slowing absorption will increase vacancy to 5.4 percent.

increase in vacancy

5.8% increase

Rents: The average effective rent will climb 5.8 percent in 2017 to $989 per month. This gain is slightly lower than last year’s boost of 6.3 percent.

in effective rents

...continued on page 7

• In the past, this market has attracted many West Coast investors seeking to escape the compressing yields of their local markets. Approximately one-third of buyers in the past five years came from California.

Local Apartment Yield Trends Apartment Cap Rate

United States

10-Year Treasury Rate

12% Average Rate

0%

6,500 units

Investment Trends

4% Employment Trends

14

15

16

17*

pletions and Absorption Absorption

5 REASONS TOTOUSE RENTEGRATION REASONS

6%

5

3%

USE RENTEGRATION

Management Database - Rentegra- Rentegration.com a web 4.complexes • A number ofisvalue-add built in the 1990s and early tion.com is an easy to use, database drivbased, multi-user software offering cus2000s in areas such as Tempe, Gilbert and Chandler posted en software.

Most form fields are auto tomers 24/7 access first-year to forms generation, yields in the mid-4 to low-5 percent range. Metrow1. Access - Rentegration.com is a populated 4. Management Database - Rentefrom produced the database.

Thereturns modarchives, property management dataide, the Phoenix apartment market initial Pricing Trends web based, multi-user software offergration.com is an easy to use, database ules are all integrated and work together. base, basic accounting, vendor ordering above percent. ing cus- tomers slightly 24/7 access to 6forms driven software.

Most form arerentFor example, a customer can fields use the and other services. generation, archives, property man- roll autofunction populated from the database.

The $120 to identify all delinquencies, * Cap rates trailing 12 months through 3Q17; 10-year Treasury rate through Oct. 20. agement database, basic -accounting, mod- fees, ules are integrated andforms workwith 2. Rental and Lease Forms Unlimited apply Sources: CoStar Group, Inc.; Real Capital Analytics andall create eviction other services.

For example, a customer use vendor of a fullordering line of and state specific rental atogether. $90 few simple clicks of the mouse. can use the rent- roll function to identify and 2.lease forms.

All Rentegration.com Rental and Lease Forms - Unlimitall delinquencies, apply fees,management and cre5.

Value - Large property forms are ofcreated attorneys $60 ed use a full lineby of state specificand/or rental ate eviction forms with a few simple companies that use Rentegration.com Color Standards for National Tena localand rental associations. leasehousing forms. All Rentegration.com clicks of the mouse. for only forms generation will save time $30 forms are created by attorneys and/or 3. Simplified Accounting - Owners and money • Logos areover providedother on the CDmethods. in all three forms: 5. Valueall black, - Large property manage- Mid local rental housing associations. reversed to white, or in PMS 280 Blue/PMS 7543 Gray spot and managers can track income and ex- and small size property managers and Please see belowthat for specific examples. $0 ment companies useuseRentegra3. for Simplified - Owners each unit,Accounting property and compa- independent rental owners can manage 13 14 15 16 17* pense tion.com onlyareforms • No for other colors acceptablegeneration for use for the logo. and managers can small tracksize income and their entire ny. Perfect for mid and property business at a fraction of the will save over other • Notime alteringand of the money logo is allowed.

If you have a special circumstance ex- pense each unit, property and cost of other managers andfor independent rental ownsoftware and forms. provided on the CD, please call NTN NATIONAL HEADQUARTERS 1. company. Perfect forneed mid or and small methods. Mid and small size properers, who neither have the budget • Logos should notindependent be put over a busy background. ty managers and rental size property managerssoftware. and indepenfor larger, more expensive dent rental own- ers, who neither have owners can manage their entire busithe cost of other W the need or budget for larger, more ex- ness at a fraction ofBLACK software and forms. pensive software.

01

03

05

07

09

11

13

1. Access 17*

15

Average Price per Unit (000s)

Completions

• Although sales velocity was slightly down in the past 12 months ending in September compared with the previous annual period, it has increased by 50 percent in comparison with the yearlong span ending in September 2014. The amount of trades in Glendale and Tempe have steadily risen in recent years, with first-year yields in Glendale rising 20 basis points.

9%

0%

agencies continue to consume the lion’s share, just slightly over 50 percent, of the apartment lending market. National and regional banks control approximately a quarter of the market.

Growing uncertainty Fourth Quarter about 2017 federal policy and global geopolitical concerns are keeping long-term interest rates down with pricing re-

Multifamily Research

10-Year Treasury Rate

12%

17*

could weigh on transaction

& Millichap Capital

• In the past, this market has attracted many West Coast inactivity as investors evaluCorporation vestors seeking to escape the compressing yields of their loate their yield options. Cap •calMonetary policy in transimarkets. Approximately one-third of buyers in the past five rates have remained relativetion.

Despite the Fed raising years came from California.

Local Apartment Yield Trends

14

15

16

17*

acancy Rate Trends Metro

United States

STATE SPECIFIC FORMS FOR

ARIZONA, CALIFORNIA, COLORADO, Exclusive Industry Partner of INDIANA, KENTUCKY, NEW JERSEY, NEW YORK, OREGON, PENNSYLVANIA, TEXAS, UTAH, WASHINGTON & MORE.

14

15

16

Blue PMS 280/Gray and PMS 7543 Exclusive Industry Partner State specific rental leaseof:

17* OR-RTG-20 Oregon

CHECK-IN/CHECK-OUT CONDITION

REPORT

TENANT(S): __________________________________ OR-RTG-24 Oregon ADDRESS: __________________________________ ________________________________ ______________UNIT: ______________ CITY: __________________________________ _ STATE: ________ ZIP: _________________

PET AGREEMENT Rating Scale

= (E)Excellent (VG) Very Good

TENANT INFORMATION

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

IN Out TENANT(S): ____________________________________________________ DATE:________ LIVING AREAS ADDRESS: ____________________________________________________ UNIT: _________ KITCHEN CITY: _________________________________________ STATE: __________ ZIP: _________ Walls

Rent Trends

In

Out

BEDROOM 3

Walls

DESCRIPTION OF PET(S) Windows

Stove/Racks

Blinds/Drapes

Dishwasher

AGREEMENT

Counter Tops

Locks

Garbage Cans

8% 6%

Windows 1) The pet(s) shall be on a leash or otherwise under tenant’s control when it is outside the Antenna/Cable tenant’s dwelling TV unit.

Blinds/Drapes 2) Tenant(s) shall promptly pick up all pet waste from the premises promptly.

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

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

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

6) Tenant(s) shall notBEDROOM allow their pets to cause any sort of disturbance or injury to the 1 BEDROOM 2 other tenants, guests, landlord or any other persons lawfully on the premises.

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

Windows 8) This agreement is incorporated into and shall become part of Windows the rental agreement exe Blinds/Drapes -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.

48-HOUR NOTICE OF ENTRY

Pursuant to RCW 59.18.150, this is your WA-RTG-20 Washington 48 hour entering the dwelling notice that your

Light Fixtures TENANT(S between the hours ): __________________ (Date) of and __________________ Doors/Woodwork ADDRESS . : __________________ __________________ (Time) _________ (Time) _________ CITY: ___ Locks__________________ _________ The entry will _________ _________ occur for the following ___UNIT: ______________ ________ STATE: ________purpose: ____________________ Rating CeilingsScale = (E)Excellen ZIP: _________________ ____________________ t (VG) Very Good __________ ____________________ (G)Good __________ (F)Fair __________ Electric Outlets __________ __________________ (P)Poor IN Out ____________________ LIVING AREAS In __________________ Out KITCHEN In Out Walls

Cabinets Tenant(s) Tenant(s) certify that the above pet(s) are the only pet(s) on the premises.

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

Year-over-

6

Light Fixtures

Doors/Woodwork

landlord or their agents unit and premises located at (Address) ____________________ will be CHECK-IN/CHE ____________________ CK-OUT CONDIT ____________________ ION REPOR __________________ T on

Floor

Carpet/Vinyl/Wood 3) Type _______________ Breed _______________ Size ______ Age __ Weight ___ Color ____ Name ________ Disposal Vaccinations: Yes____ No____ License Number: ______________ Additional Security Deposit Required:$

__ UNIT: _________ _ STATE: __________ ZIP: _________

____________________

Blinds/Drapes Rods

2) Type _______________ Breed _______________ Size ______ Age __ Weight ___ Color ____ Name ________ Vaccinations: Yes____ No____ Floor License Number: ______________ Shelves/Drawer

Y-O-Y Rent Change

WA-RTG-40 Washington

48-HOUR NOTICE OF ENTRY

TENANT(S): __________ ____________________ ADDRESS:

____________________ ____________________ Out CITY: __ DATE:________ ____________________ ____________________ __________

Windows

Refrigerator 1) Type _______________ Breed _______________ Size ______ Age __ Weight ___ Color ____ Name ________ Vaccinations: Yes____ No____ Rods License Number: ______________ Ice Trays

hly Rent

In

Walls

BEDROOM 3

Walls

Windows

BATH ROOM

Landlord

Towel Bars

Walls

Stove/Racks

Blinds/Drapes

Phone

Windows

Refrigerator

forms available in: AK, AZ, CA, CO, DC, DE, FL, GA, IL, IN, KS, KY, MA, NC, NJ, NV, NY, OH, OR, PA, TX, UT, VA, WA & WV.

Rental Housing Journal Arizona · December 2017

rentegration.com 503.933.6437 sales@rentegration.com Rods

Sink & Vanity

Floor

Toilet

Tub/Shower

Method Ice Traysof Service:

Blinds/Drapes

Personal Service:

od

r * Add one additional Disposal

Post and Mail:

Rods

Shelves/Drawe

Carpet/Vinyl/Wo

Light Fixtures

Floor day for compliance

if served by post

*

and mail.

www.Rentegration.com 503-933-6437 Rods

_____________________________ Floor Landlord

Light Fixtures

Doors/Woodwork

Rods

______________________________ Floor Tenant ______________________________ Light Fixtures Tenant

Locks

Doors/Woodwork

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

Ceilings

Electrical Outlets

Ceilings Electric Outlets

Fan (Exhaust) Doors/Woodwo rk

Floor Locks

Electric Outlets Ceilings

Cabinets

Light Outlets Electrical Fixtures

Services

Windows

Hot Water

Windows

Blinds/Drapes

Light Fixtures

Doors/Woodwork

Locks

Ceilings

Electric Outlets

Smoke Detectors

Blinds/Drapes

BATH ROOM

Towel Bars

Electricity

Smoke Detectors

may be reprod

Sink

Floor

Garbage Cans

TV Antenna/Cable Essential

Fireplace Plumbing

Cleanliness Heating

Sink & Vanity

BEDROOM 1 Walls

©2011 NO PORTION of this form

Dishwasher

Counter Tops

BEDROOM 2 Walls Windows ©2009 NO PORTION

Toilet Tub/Shower Fan (Exhaust)

of this form may Floor be r

sales@rentegration.com

PM

PERCENT WITH BACHELOR

221,000

28%

Metro Rental Housing Journal Arizona U.S. Average 29% * 2017-2022

Phoenix

3Q17 – 12-MONTH PERIOD EMPLOYMENT: Local Apartment Yield Trends

Employment Trends Metro

1.7%

Apartment Cap Rate

United States

• Employers created 34,300 jobs since October 2016, down from 70,200 in the previous yearlong period. Em9% ployment growth in Phoenix outpaced the national rate 6%of 1.4 percent in the same time frame.

15

16

12 months by adding 11,000 jobs, while education and services gained 9,000 jobs.

0%health 01

17*

05

07

09

11

13

17*

Pricing Trends CONSTRUCTION:

9 6 3 0 14

15

16

Vacancy Rate Trends

• Deliveries are down from roughly 7,800 units completed $90 in the prior 12-month period. Completions were frequent Metro in neighboring Chandler and Southwest Mesa where $60 roughly 1,500 apartments were brought to market. U.S. 21%

21%

•$30Central Phoenix recognized the largest surge in construction activity with 900 units completed in the last $0 four quarters and 1,700 units since October 2015.

13

17*

14

15

16

17*

VACANCY:

221,000

• The heightened pace of completions among Class A properties underscores the considerable rise in the Metro metro’s vacancy to 5.3 percent.

17*

Submarket Vacancy Highlights 3Q17 RENTS: 5.5% increase in effective rents Y-O-Y

$750

6%

$500

4%

$250

2%

14

15

16

* Forecast

DEMOGRAPHIC HIGHLIGHTS

567,800

FIVE-YEAR HOUSEHOLD GROWTH*

221,000

Chandler South Tempe

4.5%

2%

4.9%

1% 0% 13

Southwest Mesa Northwest Phoenix

110

5.3%

150

$1,056

14 5.9%

15015

$868 16

$$ Completions and Absorption 110

$794

North Tempe/University Metro 12

6.3%

220 Metro

U.S. 21% North Central Phoenix 9

6.3%

60

Central Phoenix

9.4%

21%

13

70

$1,108

4.5%

$59,965

3.4%

150

$1,056

14 Median 5.9% 15015 $868 16 U.S. $58,218

7.0% 17*

5.9%

6.7%

110

6.3% 6.3% 9.4%

6

Peoria/Sun City/Surprise 3

$794

220

$1,225

38% Rent 60

1.6%

$960

2.6%

62% Own

5.1%

350

$1,229

-4.4%

170

$1,014

6.4%

$986

5.5%

**2016

Overall Metro

5.3%

0 13

110 14

15

16

17*

United States

5.7%

3.4% 7.0% 17* 6.7%

38%

13

3%

14

15

16

Outlook: Velocity will increase as investors who have held their 0% assets for five to seven years exchange into 01 or 03 a value-add 05 07 09opportunity.

11 13 15 17* newer properties Rent Trends Monthly Rent $1,000

2.6%

Peoria/Sun City/Surprise 5.1% 170 $1,014 6.4% 3 POPULATION OF AGE 25+ Rent Multifamily Research | Market Report PERCENT WITH BACHELOR DEGREE+** Overall Metro 5.3% 110 $986 5.5% 0 Own Metro 13 14 15 16 17*

6%

• First-year yields for Class C assets experienced the 9% 3% in the last four quarters with average largest change returns 6% dropping approximately 20 basis points into 0% the low-6 percent realm.

350TOTAL $1,229 -4.4% 2Q17 HOUSEHOLDS

$120 $90

$60

Pricing Trends

8%

$750

6%

$500

4%

$250

2% 0%

$0

$30 $0

17*

Y-O-Y Rent Change

13

14

15

16

Multifamily Research | Market Report

62%

28%

4.9%

Completions and Absorption 6.0% 230 $1,226 10.6% 2Q17Completions TOTAL HOUSEHOLDS Absorption

Central Phoenix

U.S. Median $58,218

6

5.7%

5.3%

North Tempe/University 12

$1,225 1.6% $59,965 $960

$943

• In the unit in the Phoenix marketCap rose 17.4 percent $108,200 Apartment Rate 10-Year to Treasury Rate per 9% door. In particular, the value of Class C units rose 18.3 percent 12% during the same period to $80,500 per unit.

6.0% 230 $1,226 10.6% 3Q17 MEDIAN HOUSEHOLD Completions Absorption INCOME

(Percent of total population)

110

Metro

70 $1,108 4.5% Multifamily Research | Market Report

5.9%

South Scottsdale 3Q17 POPULATION AGE 20-34

$943

$$

12% lastLocal 12 months, the average price per Apartment Yield Trends

•4% Rent growth was strongest among Class A complexes in Southwest Mesa where it rose 39.2 percent in the Northeast Phoenix past 12 months.

4.2%Class C-40 4.0% properties $917 in North Tempe also 3% recognized exceptional growth with a 31.9 percent jump.

East Phoenix

4.0%

13

14

15

16

Year-over-Year Change

FIVE-YEAR POPULATION GROWTH*

17*

0%

Submarket

$917

Deal Flow Remains Stable Vacancy Rate Trends Amid Growing Economy

Y-O-Y • Due to strong demand in the Phoenix metro, rents have Effective Y-O-Y % Vacancy Basis PointTrends Employment steadily increased ofRents 2010, putting the Change Rate since the end Change average effective rent at $986 United per unit.States Metro

Units (thousands)

$0

SUBMARKET TRENDS

8%

Year-over-Year Change

$1,000

-40

4.5%

Metro

0%

South Scottsdale

Average Price per Unit (000s)

Y-O-Y Rent Change

Year-over-Year Change

Rent Trends

United States

3Q17 MEDIAN HOUSEHOLD INCOME 1%

Northwest Phoenix

Vacancy Rate

0% 16

28%

Average 29% • The submarkets of South Scottsdale and North U.S. Tempe/ 2017-2022 University* experienced vacancy rises of 230 and 220 basis points, respectively. Vacancy in Central Phoenix climbed to 9.4 percent amid a 350-basis-point increase.

3%

Monthly Rent

2%

Southwest Mesa

Average Rate

6%

15

4.2%

3%

POPULATION OF AGE 25+ FIVE-YEAR HOUSEHOLD North Central Phoenix 110GROWTH* basis point increase in vacancy Y-O-Y 9 PERCENT WITH BACHELOR DEGREE+**

9%

13

Chandler

United States

SALES TRENDS

Metro 12%

14

East Phoenix

(Percent of total population)South Tempe

$120

567,800

13

Northeast Phoenix

Units (thousands)

Average Price per Unit (000s)

Absorption

12

13

15

FIVE-YEAR POPULATION GROWTH* 5,700 units completed Y-O-Y3Q17 POPULATION AGE 20-34

Completions

Units (thousands)

03

SUBMARKET TRENDS

14

Y-O-Y % Change

4%

3%

0%

Completions and Absorption

Vacancy Rate

Metro

DEMOGRAPHIC HIGHLIGHTS • The leisure and hospitality sector led hiring in the previous

1%

Monthly Effective Rent

2%

Y-O-Y Vacancy Effective Basis PointTrends Employment Rate Rents Change

Submarket

Year-over-Year Change

3%

13

Monthly Effective Rent

Multifamily Research | Market Report

12% Average Rate

Year-over-Year Change

4%

Submarket Vacancy Highlights 3Q17

10-Year Treasury Rate

increase in total employment Y-O-Y

SALES TRENDS

Market Report 4Q17 ...continued from 6

17*

17*

U.S. Average 29% **2016

Rental Housing3%Journal Arizona · December 2017 National Multi Housing Group 0% 13

14

15

16

17*

* Trailing 12 months through 3Q17 Apartment Acquisitions

By WILLIAM HUGHES, Senior Vice President, Marcus Pricing trend E. sources: CoStar Group, Inc.; Real Capital Analytics

By Buyer Type* & Millichap Capital Corporation

Visit www.NationalMultiHousingGroup.com

Other,in 1%transition.

Cross-Border, 6% • Monetary policy Despite the Fed raising its benchmark short-term rate three times in seven months and Equity Fund signaling another rise before the end of the year, long-term rates & Institutions, 23% have remained stable. The yield on the 10-year U.S. Treasury bond remained in the low- to mid-2 percent range throughou Private, 64% the third quarter of 2017. The Federal Reserve wants to norListed/REITs, 6% malize monetary policy and, in addition to raising its funds (o overnight lending) rate, has announced it will begin to taper its balance sheet by allowing an initial $10 billion in securities to Apartment Mortgage Originations mature without reinvestment.

By reducing its acquisitions o Lender rates should drift upward, thereby securities, 10-yearByTreasury 100% widening the spread between short- and long-term rates.

CAPITAL MARKETS

CAPITAL MARKETS

Average Rate Average Price per Unit (000s)

Vacancy Rate Monthly Effective Rent

Percent of Dollar Volume

SALES TRENDS

Year-over-Year Change Units (thousands)

Sources: CoStar Group, Inc.; Real Capital Analytics

6%

Year-over-Year Change

Vacancy Rate

SUBMARKET TRENDS

Apartment Acquisitions Vacancy

By Buyer Type*Rate Trends as to the accuracy or reliability of the Research Associate | Re- Metro siding in the 4 percent realm United States Deal Flow Remains Stable Submarket Vacancy Highlights 3Q17 contained herein. Note: Other, 1% information Cross-Border, 6% search Services with maximum leverage of 12%Amid Growing Economy Metro-level employment growth is 80 percent. Portfolio Vacancy lendersY-O-Y Effective For information on national calculated based on the last month of Y-O-Y % Submarket Basis Point • In the lastLocal 12 months, the average price per unit in the Apartment Yield Trends Rents Change Rate will typically requireEmployment loan-Change Trends Fund 9% apartment trends, contact: Phoenix market rose 17.4Equity percent to $108,200 per the Cap quarter/year.

Sales dataRateincludes Apartment Rate 10-Year Treasury Metro United States 23% door. In particular, the value&ofInstitutions, Class C units rose 18.3 to-value ratios 4% closer to 75 transactions valued at $1,000,000 John Chang First Vice Presi12% during the same period to $80,500 per unit.

6% percent percent with rates-40 Northeast Phoenix interest4.2% $917 dent 4.0%| Research Services and greater unless otherwise noted.

3% • First-year yields C assets experienced the Thisforis Class not intended to be a forecast 9% in the high-3 to mid-4 perPrivate, 64% East Phoenix 4.5% 110 $943 Tel: 5.7% (602) 707-9700 john.change in the last four quarters with average 3% largest 2% of future events and this is not a Listed/REITs, 6% cent range. As uncertainty returns 6% dropping approximately 20 basis points into chang@marcusmillichap.com Chandler 4.9% 70 $1,108 4.5% guaranty regarding a future event. the low-6 percent realm. remains regarding the pos1% 0% 2017 3%| This is not intended to provide spe© Marcus & Millichap Outlook: Velocity will increase as investors who have South Tempe sibility of tax 0%policy5.3% revi-150 $1,056 3.4% 13 14for investment 16 17* cific advice and should held their five to 15 seven years exchange into www.MarcusMillichap.com 0% assets 13 14 01notor 03be 05 07 09opportunity.

11 15 17* sion,Southwest rentalMesa demand remains 5.9% 15015 $868 16 7.0% 17* newer properties a value-add considered as 13 investment adPhoenix Office: Apartment Mortgage Originations strong with the national vice.

Sources: Marcus & Millichap Northwest Phoenix 5.9% 110 $794 6.7%

By Lender Ryan Sarbinoff First Vice Research Services; apartment vacancy at 4.5 and Absorption Pricing Trends Bureau of Labor Completions Rent Trends South Scottsdale 6.0% 230 $1,226 10.6% President | Regional Manager Statistics; CoStar Group, Inc.; ExpeCompletions Absorption 100% percent.

Monthly rian; Rent National Y-O-Y Rent Change Association of Real$120 North Tempe/University 6.3% 220 $1,225Tel:1.6% (602) 687-6700 ryan.

12 tors; Moody’s Analytics; Real Capital sarbinoff@marcusmillichap.

75% Gov't Agency $1,000 8% $90 North Central Phoenix 6.3% 60 $960 2.6% Analytics; Financial/Insurance MPF Research; TWR/ National Multi Housing 9 com Dodge Pipeline; U.S. Census $60 Central Phoenix 9.4% Reg'l/Local Bank Bureau Group350 $1,229 -4.4% 6% $750 6 239850% E. Camelback Road Nat'l Bank/Int'l Bank John Sebree First Vice PresiPeoria/Sun City/Surprise 5.1% 170 $1,014 6.4% $30 CMBS 3 Suite 300 Phoenix,$500 AZ 85028 4%• dent, National Director Pvt/Other 25% Overall Metro 5.3% 110 $986 5.5% $0 0 13 14 15 16 17* 14 15 16 17* National Multi 13Housing 2% $250 in this The information contained 0% Group report was obtained * Trailing 12 months through 3Q17 from sources Pricing trend sources: CoStar Group, Inc.; Real Capital Analytics 12 13 14 16 17** Vacancy Trends to be reliable.

0% $0 15 Tel: (312) 327-5417 john.Ratedeemed Every effort 13 14 15 16 17* Metro United States was made to obtain accurate and sebree@marcusmillichap.com 12% * Trailing 12 months through 2Q17 information; however, no Prepared and edited by complete ** Through first half 2017 representation, warranty or guaran9% Include sales $2.5 million and greater Brandon Niesen tee, express or implied, may be made

Percent of Dollar Volume

* 2017-2022

• Increase in interest rates over the course of the year, push75% Gov't Agency ing up the cost of capital. WhileFinancial/Insurance commercial real estate fundaReg'l/Local Bank mentals 50% remain strong, rising costs associated with debt financing Nat'l Bank/Int'l Bank will tighten the spread between capCMBS rates and lending benchmarks Pvt/Other 25% This environment could weigh on transaction activity as investors evaluate their yield options. Cap rates have remained relatively sta0% ble over the last year, but upward movement in Treasury rates has 12 13 14 15 16 17** amplified the expectation gap between buyers and sellers.

months through 2Q17 environment continues to be highly •***Trailing The12capital markets Through first half 2017 competitive. agencies continue to consume the Include sales $2.5 millionGovernment and greater Sources: CoStar Group, Inc.; Real Capital Analytics lion’s share, just slightly over 50 percent, of the apartment lending market. National and regional banks control approximately a quarterMulti of the market.Group Growing uncertainty about federal policy National Housing and global geopolitical concerns are keeping long-term interes Visit www.NationalMultiHousingGroup.com 7 rates down with pricing residing in the 4 percent realm with maximum leverage of 80 percent. Portfolio lenders will typically require John Sebree Firstloan-to-value Vice President, National ratiosDirector closer to 75 percent with interest rates in the

National Multi Housing Group

Rental Housing Journal Arizona

Outsmarting Jack Frost ...continued from 1 tenants, and your business procedures.

When it comes to preparing your rental property, there are the obvious things like having the gutters cleared, roofs cleaned, and providing vent and hose bib insulation covers. If you really want to invest in damage prevention due to winter weather, there are many precautions you can take: • If you live in an area that has prolonged periods of freezing temperatures or your water pipes are exposed to the elements, you may consider having electric warmers installed on your water lines. Standard systems are controlled by a switch, but I recommend upgrading to a temperature activated automatic switch.

• After the first heavy rain, you can have the attic inspected for possible roof leaks that were created during the summer months. A quick roof patch before drywall is damaged or mold has a chance to grow is much more affordable.

• Have all your trees inspected and pruned as necessary. Any trees or limbs at risk of coming down should be dealt with before the ground loosens due to rain, and the winter winds start.

• Make sure that the earth outside your crawl space vents is below the bottom of the vent and the grade slopes away from the structure. A simple build-up of debris and dirt outside a vent can lead to the flooding of your crawlspace, along with expensive mold

problems.

• For a higher tech preventative measure, you can install moisture meters under your sinks, by the water heater, behind the fridge, under the dishwasher, and behind the clothes washer. The low-cost versions will set off an alarm that someone must be home to hear. This also relies on your tenants knowing how to turn the water off to the line that is leaking. The higher cost option is connected to a water line shut-off valve so that if the meter detects excess moisture from a leak, it will automatically stop the flow of water to that line.

• Verify that all smoke detectors are in good working order. Christmas trees, decorations, and lights all increase the risk of fires in the home.

This brings us to your tenants. Are you expecting enough from your tenants when it comes to protecting your rental in winter? Ideally, you will have your tenant’s weatherization responsibilities spelled out in the lease, or a weatherization addendum. It would also be a good idea to send out a weatherization reminder a few weeks before you anticipate freezing weather. At IRC Real Estate & Property Management (www.IRCEnterprises.com), we use this opportunity to send our tenants a winter newsletter. We include all their weatherization responsibilities, in addition to some holiday tips, recipes, local holiday events, etc. This has the added benefit of improving the tenants’

relationship with us. There are several things you can require of your tenants during the winter months. Obviously, not all of these responsibilities would be expected of tenants in multi-unit properties, but they are what we expect of our tenants in most of our 1-4 unit rentals.

Tenants should: • Cover all foundation vents. Given that they are inexpensive, I would recommend buying and delivering these to your tenants. Every winter you should verify that the tenant has enough covers. Maybe even give them 1-2 extras, just in case.

• Disconnect all outside hoses, hose splitters, and water features. Then, of course, make sure tenants have enough hose bib insulators to cover all outside faucets.

• Disconnect washing machine hoses and place them in the drain line so that both faucets can be left on at a slow trickle.

• Keep all water inside the unit running at a slow trickle.

• Keep temperature above 62 degrees at all times, even when away from home.

• Familiarize themselves with water shut-off valves.

• Notify you if they will be gone in the winter for more than a couple days. If needed, get their permission or serve a notice of entry to inspect the unit during their absence.

• Lastly, make sure your tenants know who to call in the event of winter damage.

The last area you should focus on is making sure that YOU are prepared to handle any problems that can arise with rental properties in the winter.

No matter how much you prepare your property and tenants, there is always a chance you will have an emergency to handle. If you haven’t planned ahead, then best-case scenario is that you spend a few hundred unnecessary dollars on emergency repair labor in the middle of the night. Worst-case scenario is that you can’t fulfill your responsibilities as a landlord and expose yourself to a lawsuit by the tenants. If you complete these tasks before winter hits, you should be prepared to handle any emergency repair that comes your way quickly, at the lowest possible cost: • Find two licensed plumbers you trust and that have 24-hour emergency repair services available.

• Find two drain clearing companies you trust and that have 24-hour emergency repair services available.

• If you don’t invest in space heaters, find two HVAC contractors you trust and that have 24-hour emergency repair services available.

• Instruct all your emergency repair contractors to limit their after-hours labor to protecting the property from additional damage and making the unit safe for your tenant. Then have them complete the full repair during ...continued on page 9

4 Roof Preventative Maintenance Steps ...continued from 3 lady was upset because she said the ceiling in her bedroom had collapsed.

I know people are prone to exaggerate, so I've learned not to accept necessarily what they say, but to go and check it. I agreed to look at the roof, and because our people were all busy I was the one who went there to check it. Sure enough, she was correct. It's the only time I have ever seen this - her ceiling in the bedroom literally had collapsed.

She had sheetrock on the bed, insulation was down, it was a mess. I looked at that and thought, "Boy, do I have a problem.

We've done something wrong."

I went up on the roof to check and noted there were three holes right in front of a scupper. A scupper is a hole

through a parapet wall through which water moves to drain off a roof. Obviously, those holes had been drilled there and left there. Then, I looked at the wall above. There was a new satellite dish fastened to the wall. I took a couple of photos, went down and asked the homeowner, "When did you have the satellite dish people here?"

"Oh, they were just here last week. I just got new service." And I said, "Well, let me show you a couple photos." I showed her a photo of the satellite dish, then I showed her a photo which included the satellite dish and the holes in the roof right below it. I told her that, "Your satellite dish people first installed the dish on your flat roof right in front

of a scupper. They realized they didn't have good reception, so they moved it up onto the parapet two feet away and installed it there. They didn't bother to seal the holes. You need to call the satellite dish people and have them come replace your ceiling." Never heard anything more from her about that.

Another issue was with a shingle roof. Same issue. Got a call, "We have water leaking in." They didn't claim that the ceiling was collapsed. I checked.

It wasn't, but there was water damage requiring sheetrock repair and paint.

Same issue. Go up on the roof, there's a nice new satellite dish up on the roof.

The installer hadn't bothered to caulk at the holes before screwing the receiver base to the roof. With heavy rain, water leaked in.

Satellite dishes are a problem. The ideal way to install a satellite dish is not to have it on your roof. It should be fastened to the wall or to the fascia board, so you have no penetrations in the roof.

So good roof preventive maintenance involves correct satellite dish installation.

Summary Roof Preventive Maintenance With respect to flat roofs in multiunit housing, when the roofs are walked, make sure that any drains on the roofs are cleared of any debris because we have had cases where a flat roof has collapsed due to water accumulation.

In one case, we received a call about water dripping into a unit through

8

vents. We got up there and checked. A child's ball had blocked a roof drain.

Somehow a child had thrown a ball up on the roof and it was just small enough that it got stuck in the drain. From the water line on the parapet wall adjacent to the drain, it looked like there was probably 12 inches of water. With the accumulated water, water was running into the roof vents that were higher up on the roof.

That was a lot of weight. I was amazed that it lasted even that long, but with a pitched roof you might have had 12 inches around the drain, and you go 16 feet up the roof you have about 8 inches, so it's not as much weight across the whole roof surface. But still it's a significant amount of water, easy thing to address, so it's doesn't become a problem, and that way you avoid unhappy tenants and potential liability going forward.

SUNVEK is a commercial and residential roofing contractor, located in Phoenix, Arizona. They service commercial and multi-unit housing and HOA’s throughout the state of Arizona.

Areas of expertise include tile, shake, shingle, self-adhered flat roof systems, spray polyurethane foam, TPO and coatings of various types.

•

Rental Housing Journal Arizona · December 2017

Rental Housing Journal Arizona

How Do You Practice Compliance in Apartment Leasing and Management?

By Ellen Clark

the job!

Practicing compliance strategies will not only keep things fresh in employees’ minds, but will allow them to apply their knowledge to novel situations in order for them to go beyond memorization to understanding.

This is when you will start to see behaviors change on the job, which is what training is all about.

T

he Grace Hill training tip of the week focuses on practicing compliance training. Compliance training is important for landlords and property managers to keep up with ever-changing rental housing laws at federal, state and local levels.

Can you imagine how delighted you’d be if all of your employees were compliance experts? Studies of top performers in music, chess, and sports point to the importance of practice in the development of expertise.

With most skills in life, if you want to be great, you have to practice. But how does one practice compliance? As trainers, we sometimes fall into the “check the box” mindset.

We are happy when all employees take their fair housing or harassment training once a year. Deep down, though, we know it takes more than that to be really good at compliance. It takes practice.

How can you create meaningful compliance practice initiative?

Here are some tips!

• Creating a recurring monthly training scenario will help your learners to retain and transfer compliance lessons to their jobs.

• Make a practice plan. Create an initiative around compliance practice.

For example, create monthly compliance refreshers where employees

get a few scenario-based questions to answer. Build a course in Vision X to deliver and score the questions.

• Create a little competition and make it fun. Set up a simple leaderboard or acknowledge participating employees in a company-wide email or with a few words at a team meeting.

You might be surprised what some healthy competition can do.

Focus on meaningful, relevant scenarios Use realistic scenarios and decisions that employees will encounter on the job. Making the practice scenarios relevant will ensure employees don’t feel they are wasting their time.

Use your experience to generate real

Do You Give Feedback? ...continued from 2 about this when providing feedback in other formats as well.

In a pinch, have learners generate their own feedback.

What if you don’t have the time or resources to provide explanation on written assignments or more complicated work products?

In these cases, ask learners to evaluate their responses against a scoring rubric and a sample answer. Purposeful comparison to an exemplar, even if the learner doesn’t get feedback from you, can be helpful in getting things into long-term memory.

A missed question or imperfect assignment provides just the right opportunity to teach and correct any misconceptions the learner has. Don’t let these important moments go by!

Instead, use targeted, timely, explanation to improve performance and keep learners headed in the right direction.

Ellen Clark is the Director of Assessment at Grace Hill. Her work has spanned the entire learner lifecycle, from elementary school through professional education. She spent over 10 years working with K12 Inc.’s network of online charter schools - measuring learning, developing learning improvement plans using evidence-based strategies, and conducting learning studies.

Later, at Kaplan Inc., she worked in the vocational education and job training divisions, improving online, blended and face-to-face training programs, and working directly with business leadership and trainers to improve learner outcomes and job performance. Ellen lives and works in Maryland, where she was born and raised.

About Grace Hill – For nearly two decades, Grace Hill has been developing best-in-class online training courseware and administration solely for the Property Management Industry, designed to help people, teams and companies improve performance and reduce risk • .

Rental Housing Journal Arizona · December 2017

scenarios, but also scan HUD, EEOC or state agency websites for important compliance news, recent claims and court decisions. These are great for developing scenarios.

Learners tend to succeed when allowed to practice in a safe, low-stakes environment Create a safe space. In job training contexts, practice allows learners to succeed or fail in a safe, low-stakes environment.

When presenting practice activities to employees, don’t penalize them for getting things wrong. People need to feel like they can try and fail without being afraid of consequences or feeling bad. Let them know that practice is low stakes because the high stake part is on

Ellen Clark is the Director of Assessment at Grace Hill. Her work has spanned the entire learner lifecycle, from elementary school through professional education. She spent over 10 years working with K12 Inc.’s network of online charter schools - measuring learning, developing learning improvement plans using evidence-based strategies, and conducting learning studies.

Later, at Kaplan Inc., she worked in the vocational education and job training divisions, improving online, blended and face-to-face training programs, and working directly with business leadership and trainers to improve learner outcomes and job performance. Ellen lives and works in Maryland, where she was born and raised.

About Grace Hill – For nearly two decades, Grace Hill has been developing best-in-class online training courseware and administration solely for the Property Management Industry, designed to help people, teams and companies improve performance and reduce risk.

•

Outsmarting Jack Frost ...continued from 8 regular business hours. If your property is protected and your tenant is taken care of, then there is no reason to waste any more money on inflated after-hours labor rates.

• To avoid expensive after-hours HVAC labor rates, we purchased some large electric space heaters for residential use. If heat goes out in the winter, then you are required to have it repaired or provide another heat source ASAP. The cost of you or a handyman delivering some space heaters in the middle of the night is much less than paying a HVAC contractors’ after-hours labor rates. This will make the tenants feel taken care of since you provided heat quickly, and you’ll get to save money by having the HVAC repairs completed during normal business hours. If your rental unit has a wood fireplace or stove, you can also maintain a stockpile of wood to deliver instead of space heaters.

• Lastly, make sure your tenants know how to get a hold of someone to report an emergency repair outside of your normal business hours. Within our company we contract with a call center company that has our after-hours contractors contact information. You could also incentivize one of your contractors to be available 24-hours and coordinate emergency repairs.

Or you can simply give your tenants your cell phone number to call and be sure to have the volume turned up to high before you go to sleep.

Winter can be a very scary time of year for a landlord, especially landlords with low-profit margins. If you are willing to put in some work and maybe even a little financial investment, you can avoid most winter emergencies. For those inevitable emergencies, you will be prepared to handle anything that is thrown at you with confidence. Don’t wait until 2:00 a.m. on Christmas morning when a tenant wakes you up with an emergency to find an after-hours contractor. If you get this done before winter and have your 24-hour repair phone numbers easily accessible, you will be back to sleeping soundly after making one phone call. No stress or worrying, just sweet, relaxing dreams, because you can rest assured that your tenants are being taken care of and your rental property is being protected.

Good luck this winter, but don’t wait any longer to get prepared!

Christian Bryant President of IRC Real Estate and Property Management www.IRCEnterprises.com • 9

Rental Housing Journal Arizona

I

Is the Outdoor Faucet at Your Rental Property Winter-Proof?

s your rental housing outdoor faucet ready for winter? The maintenance checkup this week provided by Keepe to be sure you are your protecting your investment and income as well as your tenants.

If your rental property is occupied and your tenants are running the water, the risk of indoor pipes bursting is low.However, the outdoor hose bibs are particularly vulnerable to freezing and breaking, especially during a cold night. Whether you are in the Midwest with below freezing temperatures or in the Pacific Northwest, where winters aren’t as frigid, cold can still spell trouble for your rental property.

Why do outdoor faucet hose bibs burst?

The physics is pretty simple. Outdoor faucets that are mounted on the outside wall still have water inside. When the temperature falls below zero, the water turns into ice. Ice expands and occupies

more space inside pipes. Depending on the age of the piping, this can result in the pipes bursting.

Why is this damage invisible?

Burst hose bibs often cause water damage invisible from plain sight, either in the drywall or in the basement.

This damage can be difficult to detect which leads to longer and deeper problems that require expensive repair.

What is the best prevention?

The easiest way to prevent outdoor faucets and hose bibs from freezing is by installing hose bib covers. Hose bib covers create a buffer between the outdoor faucet and the cold air, and therefore keeps the faucet from freezing or bursting. They are about $10 at Home Depot and other stores. From a timing perspective, it is critical to install the cover before winter.

Keepe is an on-demand maintenance solution for property managers and independent landlords. Keepe makes

a network of hundreds of independent contractors and handymen available for maintenance projects at rental properties. Keepe is available in the Greater Seattle area, Greater Phoenix area, San

Francisco Bay area, and is coming soon to an area near you. Learn more about Keepe at http://www.keepe.com •

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

Dear Maintenance Men ...continued from 4 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.

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 “Goo-Gone”, found at Home Depot, may be used to remove gum, tar, grease and glue. Use Goo-Gone sparingly If you need maintenance work or consultation for your building or project, please feel free to contact us. 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

•

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Rental Housing Journal Arizona · December 2017

Rental Housing Journal Arizona

How to Raise Money ...continued from 2 able to syndicate. We pay out to the Investors who are Class A of the LLC that owns the asset and we pay them 8-9.5% per year.

“Another plus that has arisen postJOBS Act is that with platforms posting their deals online, investors and syndicators have a gauge to see what others are doing that they never had when all such offerings were “private” under the original Regulation D, Rule 506 [now 506(b)], which is still alive and well. As a refresher, Rule 506(b) doesn’t allow any form of advertising or solicitation, but you can include both Accredited and Sophisticated Investors, and there are a lot more Sophisticated Investors than there are Accredited, so there is still a need for private offerings under this rule for those willing to take the time to develop pre-existing relationships before making offers to investors,” she writes.

One very important fact about this 506 (C) fund is that only Accredited Investors can only participate and invest in it.

Rental Property Flooring ...continued from 5

months, worth $132 million. His last two syndications were sold out in just a few hours, and one in 36 hours raising $4.7 million and another one $6 million in eight hours. Between the two syndication companies he founded, Vinney’s team is controlling over $200 million worth of assets. He is a mechanical engineer. After entering USA with $7, he graduated from The George Washington University with Master’s in Business Administration in Marketing, he shifted his focus to marketing and motivation.

He was a professional fundraising consultant and motivational speaker for more than 35 years with a wonderful private company. Vinney and his wife started their real estate investments in 1983. He currently owns single-family homes and multifamily units in Texas, California, Atlanta, Arizona and India. Many times, people call him “Mr. Enthusiasm” or “Mr. Smiles.” He likes to bring great value to everyone he comes in touch with.

•

What is an 'Accredited Investor' An accredited investor is a person or entity that can deal with securities not registered with financial authorities by satisfying one of the requirements regarding income, net worth, asset size, governance status or professional experience. The term is used by the Securities and Exchange Commission (SEC) under Regulation D to refer to investors who are financially sophisticated and have a reduced need for the protection provided by regulatory disclosure filings. Accredited investors include natural individuals, banks, insurance companies, brokers and trusts.

To be an accredited investor, a person must have a net worth of $1,000,000 or more excluding the equity in the primary residence or demonstrate an annual income of $200,000, or $300,000 for joint income, for the last two years with expectation of earning the same or higher income. Also, if an entity consists of equity owners who are accredited investors, the entity itself is an accredited investor.

A sophisticated investor is a type of investor who is deemed to have sufficient investing experience and knowledge to weigh the risks and merits of an investment opportunity. For certain purposes, net worth and income restrictions must be met before a person can be classified a sophisticated investor.

Resources:

Multifamily Financing: The Ultimate Guide to Multifamily Loans Apartment Finance Today: What’s Impacting Investments? What are Investors Looking For? What is an accredited investor?

What is 'Regulation D – Reg D’ What is the 'Securities And Exchange Commission - SEC' Jumpstart Our Business Startups (JOBS) Act Vinney Chopra is the Founder and CEO of Moneil Investment Group and President of Ideal Investments Group. His latest accomplishments include acquiring 12 multifamily assets in the last 28

al: Carpeted floors can be neutral to your house value.

Vinyl flooring pros • Variety: you can find a large variety of vinyl for your house, in terms of colors, materials, etc.

• Maintenance: Vinyl is easy to clean and maintain.

• Softness: Vinyl floors are softer than other types of hard flooring.

• Durability: Vinyl floors are durable because they are soft.

• Affordability: Vinyl is by far the cheapest option.

Vinyl flooring cons • Ease of installation: It is better to ask a professional to install it.

• Eco-friendliness: As a plastic surface it does not qualify as eco-friendly.

• Contribution to the resale value of your house: Vinyl floors can decrease the resale value of the house

These are the numerous rental property flooring options available and their pros and cons. Besides these attributes, the ultimate choice also depends on the type of renter that the property is targeting, the duration to an expected sale of the property, the expected frequency of renter turnover, etc. This post is meant to aid you in making the exercise of choosing rental property flooring somewhat easier.

Keepe is an on-demand maintenance solution for property managers and independent landlords. Keepe makes a network of hundreds of independent contractors and handymen available for maintenance projects at rental properties. Keepe is available in the Greater Seattle area, Greater Phoenix area, San Francisco Bay area, and is coming soon to an area near you. Learn more about Keepe at http://www.keepe.com •

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Rental Housing Journal Arizona

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Rental Housing Journal Arizona · December 2017