Rental Housing Journal Metro July 2016

Rental Housing Journal Metro

July 2016

2. Portland Ranks 2nd for Highest Metro Rent Growth

6. Proactive Management Solutions

3. Make Your Units Spacious and Cohesive With New Flooring

8. Tips for Taking Better Photos When Marketing Your Property

7. Death in a Unit

5. Starry Night at Oaks Park

9. Ask the Secret Shopper – Appropriate Appearance

www.rentalhousingjournal.com • Professional Publishing, Inc

10. Dear Maintenance Men – Mold, Flush Valve Seats and Preventative Maintenance for Heaters and Air Conditioners 11. Multifamily Apartment Marketing – 5 Lease Renewal Points of Contract 13. Property Event Ideas for the Summer

Portland/Vancouver

Published in association with: Multifamily NW; Rental Housing Association of Oregon; IREM & Clark County Association

Delaware Statutory Trusts:

Single Best Way for Property Managers to get Promoted What is the Single Biggest Secret to Being Promoted From Property Manager to Regional Manager, Vice President or CEO?

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s EVP at MultiFamily Traffic, I have worked with thousands of property managers, regional managers, marketing managers, CEO’s etc. I have seen them come and I have seen them go. Recently my friends at Rental Housing Journal asked me what the number one trend is in our industry is. My answer is this, management companies are desperate for rock-star talent and when they find it they will promote that person as high as they possibly can.

So, what is the secret to being promoted in our industry? The answer may surprise you, it’s not hard work and it’s not who you know. It’s all about how well you can manage the asset and how profitable you can make it. If you can outperform the other managers in terms of leases and lowering occupancy rates and show leadership your abilities are scalable, get ready for an amazing career, you are now in line to be CEO. So let’s breakdown what it means to get leases, increase revenue and scale. Let me start by telling you what it is not. continued on page 15 Professional Publishing Inc., PO Box 6244 Beaverton, OR 97007

An Innovative 1031 Exchange Solution

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or years, real estate investors have successfully used section 1031 of the IRS Code to exchange their property for bigger and better “like kind” property and defer payment of capital gains tax on their sale. Traditionally, investors have used the “three property rule” for identification and exchange purposes.

However, now there is another solution which provides investment property

owners with even greater flexibility from a property identification standpoint and much more potential diversification. This comes in the form of the Delaware Statutory Trust or DST. A Delaware Statutory Trust is simply a separate legal entity created under the laws of Delaware to hold title to one or more income producing commercial properties. This can be any type of

commercial property; apartments, retail space, office buildings, industrial parks, etc. And much like a REIT (Real Estate Investment Trust), an individual DST may hold title to multiple properties at one time.

Each investor owns a “beneficial interest” in the trust which, in turn, owns the continued on page 17

You May Want to Rethink That Lease Renewal if You are Planning to Sell Your Small Plex

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f you haven’t raised your rents already, I’m sure the rent increase notices are in the mail. I’m also sure that some of you have tenants that you can’t wait for their leases to end so you can move their rents up to market levels. However, before you sign any new lease agreements you need to make sure you are not planning on selling first. Rising rents have caused small plex (2-4 units) property values to increase significantly over the past several months prompting many owners to sell and exchange into larger multifamily properties or different asset classes. If you are concontinued on page 4 PRSRT STD US Postage PAID Portland, OR Permit #5460

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

Rental Housing Journal Metro

Portland Ranks 2nd for Highest Metro Rent Growth

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emand for U.S. rental apartments surged during the second quarter of 2016, gaining momentum after a sluggish performance in the first three months of the year, according to a new report from the RealPage.com MFP Research Division.

The occupied apartment count across the nation’s 100 largest metros increased by 127,402 units in the second quarter, according to the report.

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This is one of the biggest quarterly demand totals posted throughout recent years, topping 2015’s second quarter demand volume by 23 percent. Furthermore, apartment demand from April to June well surpassed completions totaling 67,550 units, according to MFP Research.

“Any concerns that the market couldn’t handle this year’s increase in apartment deliveries appear unfounded for the moment,” Greg Willett, chief economist

of RealPage, said in a press release. “As we’ve hit prime leasing season, the greater product availability—brought by sizable new supply—is revealing bigger product demand capacity. Initial lease-up for most new additions is registering at a very healthy pace, and we’re managing to squeeze a few more residents into an existing stock that’s been essentially full for quite a while.”

Apartment Occupancy Returns to Peak Level U.S. apartment occupancy inched up to 96.2 percent in the second quarter, regaining the bit of ground lost in late 2015 and early 2016.

Current occupancy matches this economic cycle’s previous peak rate seen in the third quarter of last year. The only time occupancy has been tighter was at the height of the tech boom in 2000 and early 2001.

“Occupancy remains stronger than the norm during past periods of substantial construction,” Willett said in the release.

“The fact that few young adults are opting for home purchases right now is helping the occupancy performance. Economic growth is bringing new renters in through the front door. At the same time, the number of existing residents exiting out the back for other housing options is limited.”

Rent Growth Remains Robust Typical rents for new residents climbed another 1.8 percent during the second quarter, taking the price increase seen over the past 12 months to 4.6 percent.

Monthly rents for new resident leases now average at $1,282.

Influenced by the increased volume of new supply that apartment owners and operators have in the initial leasing stage, average annual rent growth has slowed modestly from this economic cycle’s peak continued on page 18

Rental Housing Journal Metro · July 2016

Rental Housing Journal Metro

Make Your Units Spacious and Cohesive With New Flooring

By Mark Voykovic, Division Merchandise Manager, Flooring, The Home Depot

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s the apartment industry continues to see growth, tenants are looking for the best amenities and value in properties, putting pressure on property managers to keep units looking modern. Flooring is often crucial to impressing potential tenants. New technology in vinyl, laminate, tile and wood offers more options for property managers, often at affordable costs, allowing you to generate a great return on investment.

Vinyl Historically a good option for projects with smaller budgets, new advancements

in vinyl give floors a unique, high-end look with a durable finish. Instead of the sheet vinyl you’re used to seeing, many types now feature separate pieces that more closely mirror the look of ceramic tile. You can even grout some new types of vinyl, making the floor look more traditional and unified.

Different installation options include peel and stick technology, as well as clicklock systems, helping reduce labor costs and increase savings. Vinyl is also 100 percent waterproof, which has always made it a good choice for kitchens and laundry rooms.

Laminate Laminate flooring has also been advancing in durability, versatility and style.

Not only are laminates scratch resistant, but some newer products are even water resistant – withstanding household spills for as much as 24 hours. This technology allows property managers to install laminate in areas such as bathrooms and laundry rooms.

Due to the advancement of the single lock system, laminates can be installed easily and quickly, reducing labor costs.

When it is time to replace or repair units,

you will save significantly by replacing a single plank versus the entire floor.

And when you do install laminate, the finished product is going to look better than ever. Digital printing is so advanced now that certain styles are becoming difficult to distinguish between laminate and more expensive materials like wood.

Tile Tile is constantly evolving. Floor tile has progressed substantially, becoming sharper and more realistic through those same advancements in digital printing continued on page 16

Make your job a little easier Making sure resident garbage and recycling is properly disposed of can be a big challenge. When it’s not, you’re left with a mess, that costs time and money to fix.

The good news: The City of Portland Multifamily Waste Reduction Program can help.

Get free materials and support to make your job easier. Keep your garbage and recycling program working for you and your residents.

Multifamily Resource Line: 503-823-7224 Email: multifamily@portlandoregon.gov

www.portlandoregon.gov/bps/multifamily

Rental Housing Journal Metro · July 2016

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Rental Housing Journal Metro

Rethink That Lease Renewal ...continued from page 1 sidering a disposition, here are a couple things you need to be aware of: 1. Locking your tenant into a lease is also locking the value of your property into place. If you sign a one year lease at less than market rents you are asking a potential buyer to take on your existing tenants for a guaranteed period of time. It is not appealing to investors to buy an underperforming property at proforma values. The better plan of action is to leave them on month-to-month tenancy and continue to increase rents anyway.

2. You are turning away owner occupy buyers. The majority of offers that we are seeing on small plex properties are from owner occupy buyers using FHA and VA loans to buy. If you have your units tied up in leases, they may not be able to move into the property for several months or a full year causing these buyers to look elsewhere.

These buyers are usually willing to pay more than the typical investment buyer and If you are looking to achieve retail values, these buyers may well be your best audience. For new tenants, consider a month-tomonth agreement so that if you do encounter an ‘owner occupy’ buyer they will be able to evict the tenants within a reasonable amount of time and move in to the property.

There are a few items you should consider if you are trying to make your property more appealing to these owner occupy buyers aside from passing on unwanted leases:

1. Think about your small plex the same way you would if you were selling your private residence. I am not suggesting that you stage the property or have open houses. However does it have curb appeal and does it look livable? Things that may not scare away a seasoned multi-family investor have the ability to stop an owner occupier in their tracks before they ever even write an offer. You might need to hire a landscaper, or spend a few dollars on paint to make sure you give the right first impression.

2. Does your property have deferred maintenance that needs to be addressed? Items such as peeling paint, damaged exterior, missing smoke alarms or co2 detectors may prevent

a FHA or VA loan from funding until they are fixed. Make sure you are asking your broker what you need to do to get the property in condition to qualify for a government backed loan.

3. Don’t let your broker put up For Sale signs in the yard or show your units without an accepted offer. The last thing you want to do is parade a large number of looky loos through the property disturbing your tenant’s peaceful enjoyment of their home.

Plus, what do most tenants do when the find out the property they rent is for sale? They immediately start looking for a new place to live! Tenants know there is usually a rent increase that comes with new ownership.

LOWEST PRICES GUARANTEED!

It is a great time to be a small plex property owner. If your plan is to hold your properties, rents are on the up and cash flows are looking better. If you are planning on selling your property take advantage of these prime market conditions. It is not every day that residential buyers cross over into the multifamily market.

By Chris Salaz Chris Salaz is Small Plex Broker at SMI Commercial Real Estate, LLC . Please contact Chris if you would be interested in receiving SMI’s free bi-annual newsletter which includes the most comprehensive rent and vacancy survey in the mid-valley, the SMI Apartment Update. 503.390.6060 Chris@smicre.com

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There are risks associated with investing in real estate and Delaware Statutory Trust (DST) properties including, but not limited to, loss of entire investment principal, declining market values, tenant vacancies and illiquidity. Potential cash flows/appreciation and diversification are not guaranteed to produce positive results.

Securities offered through Concorde Investment Services (CIS), LLC, member FINRA/SIPC. Peregrine Private Capital Corporation is independent of CIS.

Rental Housing Journal Metro · July 2016

President: John Sage Vice President: Phil Owen President Elect: Ron Garcia Secretary: Lynne Whitney Treasurer: Elaine Elsea

John Sage, RHA Oregon President

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Past President: Elizabeth Carpenter Office Manager: Cari Pierce

President’s Message

Starry Night at Oaks Park

he next couple of months for RHA Oregon include some exciting events: our Starry Night event in July and our Annual Picnic at Oaks Park in August. Both of these events offer opportunities for our vendors and members to volunteer their time and energy to our organization. Neither of these events would be the success they are without the efforts of these two groups.

As you know, our vendors are a very important part of RHA Oregon. Many of the events and training that we do would not be possible without their support. We encourage you to invite and bring a vendor or landlord that would benefit from learning about RHA Oregon. While at the events you can get to know other property owners and find out what they know that you didn’t even know you had questions about.

So what might you ask, do we have in the works? Well, on July 20th starting at 6pm at the RHA Oregon conference annex, 10530 NE Weidler , Portland, OR, we are

having our annual event-- “Under a Starry Night”. This event is again an opportunity to meet and talk with other vendors and property owners. But the main focus of the event is an auction to support JOIN. At last year’s event we raised enough to get a family off the streets and into housing.

I recently received a picture of the family that we were able to help last year and the smiles on their faces made all the effort that went into this event very worthwhile.

The board of Directors for RHA continues to serve lunch to the homeless once a month at JOIN’s day center. If you would

like to volunteer by helping to serve the homeless, contact the RHA office to find out more information.

As always, since long before I became a member of RHA Oregon, we have our Annual Oaks Park Picnic on August 10th starting at 2 pm. There will be food, BBQ, games, and rides for the kids, plus another opportunity to meet other property owners and vendors. Be sure to bring an age appropriate prize for the bingo games later in the day. It always amazes me, the generosity of our members and the prizes that they bring.

10520 NE Weidler, Portland, OR 97220 (503) 254-4723 • Fax (503) 254-4821 info@rhaoregon.com • www.rhaoregon.org

So be sure to contact the office to register for the upcoming events and invite your favorite vendor or other property owners. Show them the great organization that is RHA Oregon. I look forward to seeing all of you there and getting to know you better.

Sincerely, John Sage President RHA Oregon Stegmann Insurance Agency Inc.

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 Rental Housing Journal Metro · July 2016

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Rental Housing Journal Metro 16083 SW Upper Boones Ferry Rd, Suite 105, Tigard, OR 97224 503-213-1281 | Fax 503-213-1288 | www.multifamilynw.org

Proactive Management Solutions Dave Bachman President of Cascade Management

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rofessional property management organizations work in a very active industry full of change. The organizations we work for are busy with multiple transactions, legislative issues and new multifamily inventory being brought online. We can easily be consumed by tracking thousands of details and numerous tasks. The challenge becomes the struggle to find time to proactively move forward.

We all can stay busy being reactive, but the opportunity lies in being proactive as we work to push and track goals as well as initiatives. The challenge can often take the form of a distraction or attempting to multitask when in reality we are most productive and “in the zone” when we are singularly focused on one task, goal or initiative at a time. Being truly focused on only one goal or initiative at a time may be difficult or impossible, however the point of prioritizing our thoughts and efforts is still valid. When we are not focused, the tendency is to be more reactive than proactive and that culture of stress and inefficiency can work its way through your organization leading staff to feel more failure than success. A study out of Western Washington University in 2009 concluded that when we are attempting to multitask

or when we are overly consumed with what we cannot solve, we miss 75% of the solutions or issues that are specific to our primary objective. That statistic is too high considering all we work to accomplish in our industry.

In order to stay focused and proactive, we need to be aware of the distractions that we face such as email, phone, vendors, residents and administrative tasks.

We need to be aware of all the issues that surround us but be able to solve our primary and most critical objectives. A recent study conducted by Microsoft revealed that the average attention span of humans has declined from 12 seconds in the year 2,000 to 8 seconds in 2015. As a comparison, the average attention span of a goldfish is 9 seconds. It therefore takes effort to combat our distractions. I communicate to my organization 4 reminders to stay focused and to remain proactive as follows: 1) Focus on the issue, not the story – We tend to put our mind and conversation into all the areas of impact over any particular issue or problem.

We focus on what happened to someone or what a perception of impact

might have been or could be. This is time consuming and not productive to solutions. The story is likely important to filling in the blanks and fully understanding the issue. It is important, however to remember that we are working to solve the issue, not all the points of impact that make up the story. After hearing the issue and the story it is beneficial to come back to the primary issue and work through solutions or responses that surround it.

2) Get out of your own way – It can be natural human behavior to place blame, feel the victim, feel we have no control, feel we cannot accomplish, procrastinate because we are not sure how to proceed or simply make excuses (Note: nearly all the excuses we give ourselves are typically wrong). We can recognize and solve these thoughts and behaviors and stay proactive by talking to ourselves differently. We can ask “what can I do”, “how can I improve”, “how can I be more empowered” or “how can I be more productive.” Staying focused on I or we statements can immediately set a path to proactivity and bring you back to the issue, which should be your main point of focus as stated above.

fore how they keep their organizations focused. The point is to recognize what works and tailoring those solutions to fit your position or the structure of your organization.

4) Identify your time thieves – We have people, organizations or circumstances that can create a lot of inefficient time for our organizations (co-workers, meetings, residents, etc.). We often do not recognize or remember how much time was wasted or spent that otherwise could have been more productive. The goal is to recognize these moments, record them in real time and work to solve using the techniques listed in the previous steps.

We are not the victim of an industry full of movement and change. We are the solution to moving our industry forward on solid ground. We can accomplish this by working to be more efficient and focused on our direction. We are human and flawed which makes it difficult to correct or change our habits. It is possible however to recognize where need to work differently and identify what gets in our way. Recognition and moving to solutions will nearly always lead to a productive path.

3) Personalize your productivity – Everyone has internal tips and tricks of how they stay organized and there-

Upcoming Events with Multifamily NW 7/7/2016 Project Management 7/8/2016 It's the Law - Across the River: The Differences between Washington and Oregon Laws 7/11/2016 Hot Topics in Fair Housing 7/13/2016 CAM: Legal Responsibilities 7/19/2016 Cruel and in Property Damage Restoration 7/25/2016 Low Income Housing Tax Credit 7/27/2016 CAM: Risk Management 7/28/2016 Earthquake Preparation 8/1/2016 Oregon Landlord Tenant Law Part I 8/3/2016 August Landlord Study Hall

Form of the Month OREGON

Oregon Recycling Notice – M135 OR

(INITIAL AND ANNUAL)

RESIDENT NAME(S) ___________________________________________________________________________

___________________________________________________________________________

___________________________________________________________________________

___________________________________________________________________________

___________________________________________________________________________

___________________________________________________________________________

UNIT NUMBER ___________________________________ STREET ADDRESS ___________________________________________________________________________________________________________________________________________________________________________ CITY ___________________________________________________________________________________________________________________________________________________ STATE ___________________________________ ZIP _____________________________________________________________

Recycling services are provided on site to all residents per ORS 90.318, which provides: In a city or the county within the urban growth boundary of a city that has implemented multifamily recycling service, a landlord who has five or more residential dwelling units on a single premises or five or more manufactured dwellings in a single facility shall at all times during tenancy provide to all tenants: (a) A separate location for containers or depots for at least four principal recyclable materials or for the number of materials required to be collected under the residential on-route collection program, whichever is less, adequate to hold the reasonably anticipated volume of each material; (b) Regular collection service of the source separated recyclable materials; and (c) Notice at least once a year of the opportunity to recycle with a description of the location of the containers or depots on the premises and information about how to recycle.

New tenants shall be notified of the opportunity to recycle at the time of entering into a rental agreement.

SAMPLE

Recycling containers and/or depots can be found at the following location(s): SAMPLE

____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

SAMPLE The following items may be recycled: SAMPLE

___________________________________________________________________________________________________________

SAMPLE

___________________________________________________________________________________________________________

SAMPLE

___________________________________________________________________________________________________________

SAMPLE

___________________________________________________________________________________________________________

SAMPLE

___________________________________________________________________________________________________________

Special instructions regarding recycling: SAMPLE

____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

SAMPLE

c X

This is the initial Notice and was provided to Resident at the time of entering into the Rental Agreement.

c X

This is the annual Notice and was delivered to Resident the

________________

day of

, 20___________ via:

_________________________________________

c

Notice personally served on Resident.

c

Notice posted on door and mailed to Resident via first class mail the same day.

c

Notice mailed to Resident via first class mail.

SAMPLE

Form M135 OR Copyright © 2015 Multifamily NW ®. NOT TO BE REPRODUCED WITHOUT WRITTEN PERMISSION. Revised 5/20/2015.

Landlords with five or more rentals on a single premises are required to participate in recycling programs, and this form provides to necessary initial and annual notice to tenants detailing how to recycle and where the recycling containers are located on the property.

RECYCLING NOTICE

DATE __________________________________________ PROPERTY NAME / NUMBER ___________________________________________________________________________________________________________________________________________________________________

SAMPLE

X OWNER/AGENT ____________________________________________________________________________________________________________________ ADDRESS

SAMPLE

____________________________________________________________________________________________________________________

SAMPLE

____________________________________________________________________________________________________________________

TELEPHONE

ON SITE

6

RESIDENT

SAMPLE

____________________________________________________________________________________________________________________

MAIN OFFICE (IF REQUIRED)

Rental Housing Journal Metro · July 2016

Rental Housing Journal Metro

Death in a Unit

By Cliff Hockley, President, Bluestone & Hockley Real Estate Services

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t is not uncommon to have a resident pass away at a property, whether in their apartment, on the grounds or even in a hot tub or pool. Sometimes, the on-site manager can anticipate this in advance, if a tenant is elderly or ill for example. Good on-site managers make sure to check in on such tenants and will notice if the tenant has not been seen or heard of recently. Other deaths are sudden or even violent and require training to handle properly.

If you believe that one of your tenants might be in trouble or may have died you can call the police to do a wellness check.

A tenant may be incapacitated inside a unit and unable to call for help. If the police find a body they will call in the coroner, investigate the cause of death, and notify the next of kin.

If you discover a body, you can check for signs of life but do not disturb anything in the unit or vicinity. If a person is non-responsive, call 911. If you are an onsite manager also call your supervisor and your supervisor should notify the property owner.

The police will request any information on the deceased that the building management might have, so their file should be readily accessible. Check for emergency contact information as the police will use this to identify the next of kin. Managers should ask the police to let them know once the next of kin have been no-

tified and also request a copy of the police report for the tenant files.

Leasing a property after a death Once the body has been removed the management may not be given access to the unit until the coroner and the police have completed their investigations. The authorities will advise when it is O.K. to re-enter the apartment.

When you have been granted access to the unit you must work quickly to prevent any permanent damage. If there are any pets the emergency contact needs to know that they require care. If no one is

available to take care of the pets animal control should be called.

The unit should be cleaned as soon as possible. Any items that are contaminated with bodily fluids will need professional cleaning or removal, (carpeting, flooring, chairs, mattresses, walls, sheetrock).

Jeff Darr, owner of Crime Scene Service in Monroe, NC noted in a recent article that, “A decomposed body is one of the worst health hazards, time and temperature influence decomposition, and the fatty tissue in a human body is like kerosene in that it won’t evaporate like gasoline will. It’s a greasy substance and it absorbs into the carpet and the floor. If someone dies in bed, the fluids can seep through the mattress, the box spring, the carpet, the floor—and sometimes you even have to pull up the sub-floor; the hepatitis B or C virus can live outside the body for

seven days.” His and other death cleaning companies have chemicals that kill that hepatitis, MRSA, and staph. Check on the property or tenant’s insurance policies if the coverage includes this service.

Any cleaning efforts may be hampered by the presence of the tenant’s personal affects, and the process of relinquishing this property must follow specific instructions established by law. It is a good idea to check with an attorney to be sure that you follow the process correctly.

Public notice Abandoned property rules require the posting of an abandonment notice. In Oregon, the abandonment rights and responsibilities apply to an heir or devisee; any personal representative named in a will or appointed by a court; and any percontinued on page 19

FIND EVICTIONS STRESSFUL?

503-242-2312

Full FED Service First Appearances evict@landlord-solutions.com Small Claims

Rental Housing Journal Metro · July 2016

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Rental Housing Journal Metro

Tips for Taking Better Photos When Marketing Your Property

By Katrina Langer and Jeffrey O’Connor

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ccording to Buildium’s State of the Property Management Industry Report, over two thirds of property owners feel unequipped to effectively market residential properties. When it

comes to marketing a property, this can include a variety of tactics, whether it’s listing properties on websites or working with clients and brokers for referrals.

While property managers and landlords

might have different approaches to how they market their rentals, it goes without saying that the ability to show off a residential property through photos is the foundation of vacancy marketing.

Information Resources From the Multifamily NW website to regular communications and monthly newsletters we keep our members informed on the industry. Our biannual Apartment Report gives you the latest rent and vacancy data to stay competitive.

Professional Rental Forms Multifamily NW offers a full suite of Single-Family and Multifamily rental forms that are reviewed quarterly by a committee of experts and legal counsel. With over 100 different forms, we have you covered!

Professional Development Property Management has many facets. Whether you manage single-family or multifamily we are here to provide great opportunities for Leasing, Marketing, Financial Management, Forms Training and more! Nationally Recognized Designations through NAA are a great way to show your management expertise in the industry.

Legislative Action Government & Public Affairs Committee meets monthly to discuss the current issues facing the industry and provide support on behalf of our members. Legislative Alerts are regularly provided to members so that all are informed and ready for action.

Commitment to Charity Charity Events are a very important part of the Multifamily NW agenda. Annual golf events support housing charities around the state and the Service Committee hosts charity drives and events throughout the year.

Networking Opportunities Multifamily NW offers regular networking events throughout the year. It’s the perfect chance to connect with your peers to learn the tips and tricks that make your job easier.

Annual Events With 8 large annual events and counting, Multifamily NW is second to none for educational and networking resources. We offer great sponsorship opportunities to promote your business and are committed to promoting Members Using Members (MUM).

16083 SW Upper Boones Ferry Road, Suite 105, Tigard, OR 97224  503-213-1281  503-213-1288  info@multifamilynw.org MultifamilyNW.org

That being said, there are a few important things to keep in mind when taking photos for your property listings. While it would be nice to hire a photographer, it’s not always within the budget of a property manager, landlord or owner. Luckily, smartphone providers such as Apple, Motorola, Nokia and Samsung have improved their cameras’ specs in recent years, and newer phones have great cameras. For example, the 2007 iPhone was only 2 megapixels, while the iPhone 6s comes standard with a 12 megapixel camera—a go-to for professional photographers.

But, again, you don’t have to be a professional to effectively market your real estate. This article will dive into tips and best practices for using a smartphone to take property photos.

Get the Right Equipment While most phones are equipped with almost professional-grade camera technology, some of the top-rated phones when it comes to design, function and camera specs include: Apple iPhone 6s, HTC One M9, Samsung Galaxy S7, Google Nexus 6P and Motorola Moto X Pure Edition.

Additionally, property owners and managers can download new camera apps to achieve great results, including Cocologics ProCamera (iOS), Open Camera (Android) and Lumia Camera (Windows).

Another great piece of inexpensive equipment to look into is an aftermarket wide angle lens for your smartphone (about $100). Wide angle shots are essential for great property photos, as it widens the field of view, making rooms look bigger. Additionally, a tripod or shutter release will help to stabilize the camera to help avoid shaky and/or crooked shots.

Another great way to straighten your shot is to compare the vertical lines within the room (such as a doorway, window or corner) with the grid settings in your camera app.

Set up the Perfect Shot Truly great shots are usually taken in the middle of the day, when the sunlight is softer than it is at sunrise or sunset, when it streams directly through the windows, creating shadows and bright spots. Midday light is evenly distributed throughout the room, creating a warm, welcoming atmosphere. To get the most out of this light, turn off the flash, open the curtains, and keep the blinds pulled down. continued on page 16

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Rental Housing Journal Metro · July 2016

Rental Housing Journal Metro

sk The Secret Shopper Appropriate Appearance

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veryone knows you only get one chance to make a first impression.

What you communicate from the curb, carries over into the office environment and beyond. Paying attention to professional office attire is important year round, but especially during the warmer summer months. When the weather is hot and everyone is trying to keep cool and comfortable, some employees may be presenting more than just their apartments!

This can be a distraction to co-workers and residents, and disrupt the sales process. Here is a topic of concern based on the question below:

Q: The staffs at some of our communities tend to “dress down,” especially at our smaller buildings where they have responsibilities in and outside the office. I have noticed this sometimes carries over into their personal grooming as they transition from working outside and then come back into the office to assist clients. However, during the warmer summer months when many of my managers have even more responsibilities outside, I have noticed an increase in inappropriate/ unprofessional attire and a decrease in attention to personal grooming. I am concerned about the impression my managers are making on our residents, as well as prospective renters. Other than instituting a “uniform and personal grooming policy” or mandating a strict dress code, what can we do?

These are some very valid concerns, and this issue needs to be addressed.

However, it’s an extremely sensitive subject because how people dress and present themselves is very personal. Also, there is the financial aspect, as not everyone can afford to make a high end fashion statement! When you throw “gender” into the mix, this issue becomes even more com-

plex, as it’s tough for a male supervisor to approach a female employee on this issue and vice versa. Typically when a confrontation does occur, someone is embarrassed, offended or both. Then you end up right back where you started and nothing is resolved.

For those companies who have been able to implement a “uniform” policy and standard of dress: Congratulations! You do not have any of the above headaches any more. Probably the only issue you have to deal with now on this subject is getting your employees to actually WEAR their uniforms!

For everyone else, the answer is “education.” If you have a written “dress code,” regarding attire and personal grooming for all employees, no matter what community they work at, then everyone will know what the expectations are. When a new employee is hired, they can be given this information up front as part of their new hire package. That way, they will understand how they are expected to present themselves. For existing employees

who are not in compliance because there was no written dress code at the time they were hired, you can institute a “new company policy” and create a standard for all employees to follow.

Of course you must remember a very important principle: Everything in life has a “trickle down” effect. Your efforts to get your employees to comply with a dress code will only work to the degree in which you comply with the same standard yourself. A leasing consultant does not have much motivation to dress up a notch if the assistant or resident manager is “dressing down.” On the other hand, an on site manager will not be inspired to comply with a dress code if the property supervisor or owner visits wearing casual clothing.

When employees working together dress inconsistently, this sends a mixed message to the residents and prospects that visit their office. Until people really get to know you, all they have to go on is “appearances.” The employees who are dressed in business attire will “appear” to be professional, organized and prepared to serve their clients. Those dressed otherwise will not. As in every area of life, perception is reality.

While you can’t judge a book by its cover, the next person who walks through your door could make a rental decision based upon what’s covering (or not covering) you! Having a standard of dress for all employees, no matter what community they work at, will consistently communicate a sense of pride and professionalism.

If you are interested in leasing training or have a question or concern you would like to see addressed, please reach out to me via e-mail. Otherwise, please contact Jancyn for your employee evaluation needs: www.jancyn.com ASK THE SECRET SHOPPER Provided by: Joyce (Kirby) Bica Former owner of Shoptalk Service Evaluations Consultant to Jancyn Evaluation Shops E-mail: shptalk2@gmail.com Copyright © Joyce (Kirby) Bica

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9

Rental Housing Journal Metro

DEAR MAINTENANCE MEN: Mold, Flush Valve Seats and Preventative Maintenance for Heaters and Air Conditioners

By Jerry L’Ecuyer & Frank Alvarez

Dear Maintenance Men: I have noticed the base molding in the living room and leading into the kitchen is starting to come off the wall.

The corners are splitting and it is starting to look very rough. What do you think is causing this? I don’t see any water anywhere.

Randy

Dear Maintenance Men: I have a toilet that runs every ten or twenty minutes. I have replaced the fill valve, the flapper valve and I have even scrubbed under the rim! In other words, all the items I can think of that are replaceable in the tank are new.

What else should I be looking at?

Sam

Dear Randy: We would bet you do have a water problem somewhere. Chances are it will be traced to the refrigerator. There might be two issues you can look at. First check that the drain line for the defrost cycle is not clogged and two if the refrigerator has an icemaker, that the line is not leaking.

Chances are the icemaker line has a hole or the drain line is leaking and the walls are sucking up the water. That is why you don’t see any standing water. Look under the fridge or pull out the fridge and look at the water line. It should be a small quarter inch nylon or polyethylene line; often they are white or translucent in color. If the water line goes though the cabinets to the kitchen sink; follow the

Dear Sam: You replaced all the easy ones!! When all else fails on a toilet leak down issue; it is time to put on your rubber gloves and get an adjustable wrench. Chances are the problem lies with the Flush Valve Seat.

The rubber flapper valve seals against the flush valve seat (the big hole at the bottom of the tank.) to either keep the water in the tank or let the water out of the tank.

The seat may have a burr, crack or calcium deposits that allow a small amount of water to seep past the rubber flush valve.

Sanding the seat to remove the burr or calcium deposit is a short-term solution, but rarely solves the problem for long. A permanent solution is to replace the flush

line and look for rough spots or kinks in the line. Because these small water lines often leak for a long time before they are discovered, your walls may very well be saturated. The swelling baseboards are an indication they are full of moisture.

The repair for this leak goes far beyond repairing the pinhole leak in the icemaker line. You will have to remove the drywall

in order to allow the walls to dry properly. Chances are you will also have a major mold issue inside the walls. You should seek professional help for an evaluation of the potential mold issues involved. Please note when replacing icemaker or filter lines, only use tubing specified for that use. Ask for icemaker tubing, it will be marked icemaker compatible.

continued on page 19

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Rental Housing Journal Metro · July 2016

Rental Housing Journal Metro

Multifamily Apartment Marketing Five Lease Renewal Points of Contact

By John Wilhoit Jr., Mutifamily Insights

J

ust like in any other business, marketing in multifamily has core groups of people to focus your marketing efforts on. One of these core groups is current residents.

A well-known rule of marketing is that it is easier to sell to an existing customer than to a new customer. For starters, the existing customer is familiar with your products, customer service and pricing.

Another well know rule of multifamily operations is that higher lease renewal rates save time and money. A lease renewal reduces marketing expense and vacancy loss. Also, retaining an existing resident substantially reduces make-ready costs, whereas, there may be some interior items addressed at renewal, the extended make-ready process is postponed until such time as there is a move out.

Following are five points of contact, or marketing methods (or touch points) to implement when marketing to existing customers to obtain lease renewals. Are you using all five?

In person. ‘Face-to-face is always the best option to obtain a renewal. Personal contact that includes eye contact, verbal language and body language, an opportunity to address any concerns in real-time all lead to a higher probability of obtaining the renewal. In fact, the four remaining methods noted represent methods for gaining that face-to-face meeting.

Telephone While it seems that fewer people pick up their phone for actual telephone conversations most will listen to their voice mail. This is an opportunity to use a scripted “commercial” to present the benefits of renewing now. Consider being sent to voice mail as an opportunity to present a 30-60 second sales presentation for renewing their lease.

Email Direct email marketing research tells us that people often do not make a buying decision via email until after the fifth (and sometime seventh) email contact. This tells us that a one-and-done email has no effect on the intended outcome we desire; a lease renewal. Consider email as an ad-

ditional thread in the quilt you are weaving towards increasing renewal rates.

Text Text messaging is not as age specific as you may believe. Even old people (like me) read text. Like with telephone calls, you may not get a return text, but sending the text assures that you have obtained yet another point of contact with your resident.

Snail mail Regular U.S. Postal mail delivery is often overlooked, this is yet another point of contact that rounds out the methods for contacting current residents. After all, you know their mailing address. Even though people are too busy to pick up their phone, answer a voice mail or text,

they still look at their mail. Post card mailings may costs .50 cents to $1 each.

The return on investment is very straight forward as you can correlate the increase in renewals with a certain percentage attributed to direct mail.

Post card mailings may seem generic as there isn’t any personal information on the post card other than the name and mailing address of the recipient. Yet the message is very personal in that it invites the resident to stop by the office for a beverage and sign their lease renewal. Like with concessions, you will have to test various messages to see which one obtains the best response rate.

These methods, when applied collectively, are like making sure you are well prepared for cold weather; you start out with a sweater and hat, but just to be safe, you pack an umbrella, gloves and a scarf in case the weather turns harsh (such as if new competition comes in). Sure, it could be good weather with renewals just jumping into your office, but you can’t assume this to be true. Best to be prepared for all-weather events.

Multifamily Insight is dedicated to assisting current and future multifamily property owners, operators and investors in executing specific tasks that allow multifamily assets to operate at their highest level of efficiency. This article is intended to be informational only and does not provide legal, financial or accounting advice. See http:// multifamilyinsight.com. Multifamily Insight.

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Rental Housing Journal Metro · July 2016

Rental Housing Journal Metro

Property Event Ideas for the Summer

By Mary Girsch-Bock, www.propertymanager.com

E

very year, do you promise yourself that this will be the year that you create a haven for your residents?

That this year, you’ll organize those pool parties and Saturday afternoon barbecues? But somehow, every year, your plans go awry, and when you suddenly have the time to create these get-togethers, it’s September.

The best time to plan events is now.

Create a calendar and make plans for those barbeques. Set a date in your next newsletter and notify your residents now.

This way, you’ll have no excuse for letting those dates pass.

If you’re not sure what kind of activities would work with your property and resi-

dents, here are a few ideas that are sure to bring residents together without creating a lot of extra work for your employees: Plan an Independence Day celebration.

While many of your residents may be out of town, or busy with other plans, those without a place to go will appreciate the opportunity to celebrate the day, and become acquainted with other residents.

Create a series of theme parties. You can schedule them twice a month on Saturdays or Sundays. Involve your residents in choosing a theme for the parties, and be sure to let everyone know about them at least a month in advance. To encourage participation, give a gift card to residents whose themes are chosen.

Rental Housing Journal Metro · July 2016

All of your parties need not take place outdoors. If you have a media room, Friday night movie night could prove to be very popular. Provide the popcorn, and chose a family friendly movie to show.

What better time to clean out clutter than spring? Since spring is typically when people declutter their homes, why not organize a property-wide garage sale?

Not only can residents possibly find the item of their dreams right next door, but it provides your residents with the opportunity to get rid of belongings they no longer need, and earn a few bucks as well.

If you don’t have the space to hold property parties, you can still create property events. Organize a dinner night at a lo-

cal restaurant, baseball night at the ballpark, or a picnic at a local park. While the events will not be taking place on site, the feeling behind the event is the same.

Hold informal an happy hour onsite.

From 4 to 6, set up the clubhouse with sparkling apple juice and light snacks and encourage your residents to attend.

A feeling of community is important for your residents. Give them another reason to think of their residence as home.

13

Rental Housing Journal Metro

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Rental Housing Journal Metro · July 2016

Rental Housing Journal Metro

Single Best Way ...continued from page 1 You will not be promoted if you bring in leases by: • Giving away the farm: Out of this world promotions that bring in unprofitable leases may improve your occupancy rates short term but it’s a sure fire way to get yourself locked into the role of assistant property manager for life. Giving stuff away tells your leadership that you care and can think outside the box but you are also telling them that you better be monitored by someone with experience or you will bankrupt the company. Not a good label to have associated with you.

• One-one-selling: So you are the best at closing prospective renters? Awesome.

You can show a unit, explain the benefits of living at the property and close the deal. These are all good skills to have. But, if this is what you become famous for, you have now made yourself a leasing agent for life. At best, you can hope for a “new title” and the added responsibilities of a “trainer” with little or no extra pay. Sales rock-star, get used to now doing your job and teaching the slackers how to do theirs with all hope for promotion quickly fading. Why would they take you away from the leasing office when talking to prospects is where you add value?

• Being a shopaholic: You know the type, you may be the type, its ok. The first step is admitting you are a shopaholic. You have banners, you have balloons, you bake cookies and whenever a ILS rep comes into the office you buy whatever they are selling. If you want to be promoted, you need to show leadership you have the ability to make tough decisions. Saying “yes”

to everything is not making decisions its going on a shopping spree with the company’s money.

You will be promoted if you bring in leases by: • Getting the community in front of qualified renters looking to sign a lease without having to use promotion after promotion. The best way to do this is to make sure your property is on the first few pages in Google for as many of the top searched terms that renters in the area are typing in. Additionally, by using Google AdWords campaigns. The bottom line here is, if you are the first property a prospect finds, you don’t need promotions to try and change their minds about other properties they have visited. There are enough renters that sign a lease at the first property they visit for you to get to 100% occupancy without having to use promotions. You just need to be FIRST.

same conversation but instead, you say; “I researched my community and discovered that we were over spending and underperforming because we were constantly playing catch-up due to the fact that prospects were not finding the property when they looked first. We were battling to win the war of “lookie-loos” who required the best deal to sign a lease. How I fixed this problem is, 1. I evaluated our online presence, 2. I isolated the issue and fixed it by 3. ranking the property for the top searched keywords organically as well as running a Google AdWords campaign simultaneously. This placed the property first in front of prospects allowing me to close all of the potential renters that signed a lease on the first visit, leaving our competing properties to waste resources fighting over the tire kickers.” If you are able to say this, welcome to the big leagues, you are on the path to CEO.

• Show leadership you are a leader, not a seller. Imagine meeting with the CEO, and you tell him or her that you are terrific at talking to renters, are you going to be promoted? No. Now imagine that

• Show leadership you can make tough decisions rather than spend your way out of problems. If you get to 100% occupancy but you have shown leadership a laundry list of expenses needed

Rental Housing Journal Metro · July 2016

to get there, you are not ready to lead.

Real leaders make calculated decisions.

Imagine this conversation with the VP of Operations, “my strategy to improving the properties numbers was twofold. First, I wanted to increase occupancy, but second I wanted to reduce waste and overspending. Both numbers have an equal effect on the bottom line.

I found success by boosting the properties visibility with the best renters and reducing unneeded or redundant expenses. For example, I used Google AdWords, a compressive $499 a month SEO plan and our top performing ILS. I systematically cut out all other unnecessary tenant acquisition expenses”.

You just earned yourself a promotion!

Matt Easton is EVP of MultiFamily Traffic, the only apartment SEO and AdWords management company that measures themselves by how many leases you sign.

Millions of online apartment searches are performed each day, resulting in new leases being signed. Is your website being found by renters? The fact is the first 20 results on search engines like Google receive about 97% of all click-through traffic.

MultiFamily Traffic’s job is to make your property website one of these top results. By leveraging years of expertise in both apartment marketing and apartment portfolio ownership they will help your property GET FOUND online and your VACANT UNITS LEASED. MultiFamily Traffic is headquartered in Denver, Colorado. They have been in operation since 2003 and have helped thousands communities see great success in driving low cost leases to their properties.

Most clients are so pleased with our service that they end up eliminating most other forms of lease-up services including expensive ILS subscriptions, saving the property thousands per month in apartment advertising fees. Matt can be reached directly at 303-803-7372

15

Rental Housing Journal Metro

Tips For Taking Better Photos ...continued from page 8

When setting up your shot, hold the camera about three or four feet from the floor, and try to shoot from the corners to get as much of the room in the frame as possible.

Don’t forget to take exterior shots, too.

It’s best to start these in the early afternoon, when the sun is high overhead.

And, be sure to take at least one shot from each angle to provide context for the property within the neighborhood.

you can share images easily with links you can send to colleagues and prospective buyers.

While professional photographers are a nice-to-have, it’s not always a realistic luxury for property managers or landlords when they’re looking to quickly turn over a property. With these tips and tools that can be used at little to no cost, the images needed for marketing properties can be easily taken, edited and shared as needed.

Editing and Uploading Making simple edits to property photos doesn’t require a professional editor.

There are free apps for both iPhone and Android users, such as Snapseed and Adobe Lightroom, that offer the ability to adjust verticals, exposure, white balance and sharpness. With these tools, the editing process should only take around 30 to 60 seconds per photo Once the photos are ready to go, make sure to save your work so they can be easily accessed for marketing materials. Websites such as Google Drive and Dropbox can make this a seamless process, and

By Katrina Langer and Jeffrey O’Connor

16

Katrina Langer is a content marketer at Buildium with more than five years of experience in writing and SEO, and has worked with a number of Fortune 500 companies to improve their website experience.

Jeffrey O’Connor is a Stoneham, MA based commercial photographer specializing in high end residential real estate, product, and food photography.

His portfolio includes work for small and large clients across New England and Canada, and as far away as Seattle, WA, and Sydney, Australia. He lives and works out of his home office and studio with his wife, Erin, and their dog, Laika.

Make Your Units Spacious ...continued from page 3

that benefit other materials like vinyl and laminate. Wood tile looks like wood, marble tile looks like marble, and so on. Higher end options allow you to grout and seal at the same time, eliminating the need for a second visit from installers. Select products even qualify for a lifetime warranty.

Now ranging all the way up to 48 in. x 48 in., large format tile is becoming more popular and looks great in multifamily units but requires a different type of mortar. Be sure to use a mortar specifically designed for large format tile.

engineered and click wood can be self-installed with the same benefits of long lasting, durable flooring at a lower cost.

Innovation and advancement are continuous trends in flooring, allowing more options for property managers to consider.

By Mark Voykovic, Division Merchandise Manager, Flooring, The Home Depot As the Division Merchandise Manager, Mark is responsible for merchandising all hard-surface flooring products at The Home Depot. He has been with The Home Depot for 10 years, serving in various merchandising roles.

Wood Wood flooring is now offering the same easy-to-install features as laminate and vinyl flooring, making it more affordable than it used to be. In the past, property managers had to hire someone to install wood flooring. Options such as

Rental Housing Journal Metro · July 2016

Rental Housing Journal Metro

Delaware Statutory Trusts ...continued from page 1 underlying real estate. This interest entitles said investor to his or her pro-rata share of income and appreciation in these assets.

Furthermore, this income stream is truly passive. All properties are managed by the DST sponsor. The investor is no longer responsible for the “Terrible Ts,” tenants, trash and toilets. By exchanging into one or more DSTs, they are now in the “mailbox money business.” Cash distributions form property operations inside the trust are made monthly to investors.

This income stream is also very tax advantaged. Just like rental income from your plex or apartment property, it is sheltered by depreciation and interest expense.

In summary, the DST offers many benefits to income property owners and exchangers. These include, but are not limited to: • Low minimum investment: DSTs typically have a minimum investment of $100,000 for 1031 exchangers and $25,000 for cash investors.

• Remote management: The DST structure takes management responsibility for the property(s) out of the hands of investors and places it into the hands of a sponsor-affiliated trustee.

• Cash distribution potential: The rental income generated from the DST properties is distributed on a monthly basis directly to your bank account. No more chasing down dead beat tenants in the dark of night. As rental income, this cash flow is also very tax advantaged. Just like your current rental income stream, much of it is tax sheltered via depreciation and interest expense.

• Diversification: Instead of having all your money tied up in one property exposing you to the risk incumbent in overconcentration, DSTs allow you to diversify both geographically and functionally. Like a REIT (Real Estate Investment Trust), DSTs can own multiple properties in different geographic areas with different functions.

Ownership of apartment buildings can be mixed with retail centers, office buildings, industrial warehousing, etc. In this way, a downturn in one sector of the economy can be offset by an uptick in another.

• Low cost of ownership: Unlike a tenant-in-common (TIC) program, DST investors are not required to maintain any type of special purpose LLC (limited liability company) to hold their real estate.

• Non-recourse loans: DST investors are not required to execute any loan guarantees or indemnities, given their purely passive relationship to the DST and its real estate.

Therefore, if there is debt on the property(s), investor risk is limited to invested equity. Lenders have no recourse to investors other assets.

• Liability protection: The DST “wrapper” shields the exchanger/investor from any liabilities with respect to the property. Ambulance chasing lawyers and their “slip and fall” clients will have to tap someone else.

These benefits say nothing of the leisure time exchanging into Delaware Statutory Trust properties may provide you. Property management is a full time job. This unending round of responsibility precludes enjoyment of many other activities. It’s hard to travel and see the world, visit your grandkids, or just plain relax, when you are tied to your telephone, tenants and properties.

In our past, present and future zero interest rate environment, investing in a multi-property DST portfolio may also be a good strategy for cash investors without a property to exchange. Unlike other passive, fixed-income investments, real estate still provides a livable yield. As rental income, this cash flow is also very tax advantaged.

Finally, it positions the investor to avoid capital gains tax upon the profitable sale of their real estate through a 1031 exchange.

Exchanging into a DST portfolio which holds multiple income producing properties makes great sense for real estate owners who no longer want to shoulder the burden of active management. You’re not going to live forever, so you might as well start enjoying it now. Let someone else change the light bulbs and collect the rent.

Robert Smith and Robert Straton are with Peregrine Private Capital, an advisory firm based in Lake Oswego, OR. They can be contacted at 503-241-4949 or rs@peregrineprivatecapital.com.

The information herein has been prepared for educational purposes only and does not constitute an offer to purchase or sell securitized real estate investments. Because investors situations and objectives vary this information is not intended to indicate suitability for any particular investor. This material is not to be interpreted as tax or legal advice. Please speak with your own tax and legal advisors for advice/guidance regarding your particular situation. There are risks associated with investing in real estate and Delaware Statutory Trust (DST) properties including, but not limited to, loss of entire investment principal, declining market values, tenant vacancies and illiquidity.

Potential cash flows/returns/appreciation are not guaranteed and could be lower than anticipated. Diversification does not guarantee profits or guarantee protection against losses.

Securities offered through Concorde Investment Services (CIS), LLC, member FINRA/SIPC. Peregrine Private Capital Corporation is independent of CIS.

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Rental Housing Journal Metro

Portland Ranks 2nd Highest....continued from page 2 growth of 5.6 percent, seen in the third quarter of 2015. However, today’s annual rent growth pace is still very substantial compared to the long-term historical norm that runs just under 3 percent.

“Annual rent growth in the range of 4 to 5 percent is an unprecedented result six years into a growth cycle,” Willett said in the release. Annual rent change has been positive for 24 consecutive quarters, with the average price increase during that period registering at 3.8 percent. For comparison, the mid-2000s growth cycle lasted for 19 quarters, and annual rent growth averaged 2.8 percent in that span.

Among individual large metros, Sacramento is now the country’s rent growth leader for the first time ever. Pricing for new-resident leases in Sacramento climbed 9.7 percent during the past year. The following list shows current top performing metros for annual rent growth.

Leaders in Annual Rent Growth for New Residents Year Ending in the Second Quarter 2016 Rank Metro Rent Growth Sacramento, CA Portland, OR Seattle-Tacoma, WA Phoenix, AZ Nashville, TN Oakland, CA Fort Worth, TX

9.7% 8.8% 8.2% 7.6% 7.2% 7.2% 6.8%

Los Angeles, CA Riverside-San Bernardino, CA Fort Lauderdale, FL Las Vegas, NV San Diego, CA West Palm Beach, FL Atlanta, GA

6.7% 6.7% 6.6% 6.4% 6.3% 6.2% 6.0%

Select Metros Losing Steam While annual rent growth remains near this cycle’s peak levels in most metros, pricing power is cooling meaningfully in a handful of spots.

After San Francisco, Oakland and San Jose metros, experienced huge rent growth for several years, the size of price increases is coming back to levels that appear more realistically sustainable now that the region’s building activity has climbed to record volumes. Similarly, a substantial amount of new product additions have slowed Denver-Boulder’s annual rent growth pace, after record price increases occurred earlier in this economic cycle.

Importantly, the Bay Area metros and Denver-Boulder are posting strong apartment demand. Increased deliveries haven’t resulted in vacancy issues. Thus, while rent growth has slowed from the very robust levels achieved recently, price increases are still strong relative to the long-term norm.

In contrast, Houston’s current pricing is weak, not just a slowdown from previous results. Rent growth is close to disappearing due to slowing economic growth occurring alongside aggressive apartment construction. In fact, actual price cuts have emerged in several of the neighborhoods adding the most supply.

Markets Losing Rent Growth Momentum Second Quarter 2016 Vs Second Quarter 2015 Annual Rent Growth Metro Q2 2016 Growth Q2 2015 Growth Momentum Change San Jose, CA San Francisco, CA

3.6% 4.7%

10.0% 9.9%

-640 basis points -520 basis points

Oakland, CA Denver-Boulder, CO Houston, TX

7.2% 5.6% 1.1%

11.8% 10.2% 5.0%

-460 basis points -460 basis points -390 basis points

Peak Deliveries Lie Just Ahead A recent slowdown in the number of multifamily housing units authorized by building permits suggests that the apartment construction volume should soon cool slightly.

For now, however, ongoing building remains in line with the very high levels posted over the past year or two.

Properties totaling 534,743 units are under construction in the nation’s 100 largest metros.

“With so much additional product finishing very quickly, the apartment leasing environment could become more competitive in the short-term,” according to Willett. “A large block of new supply is scheduled to finish, just as demand registers its routine seasonal slowdown in the winter months. However, barring a pronounced stumble in economic growth, there’s nothing suggesting future stock is going to cause big-picture problems.”

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Rental Housing Journal Metro ·1/12/16 July 2016 5:50 PM

Rental Housing Journal Metro

Dear Maintenance Men ...continued from page 10

Death In A Unit ...continued from page 7

valve. Start by turning off the water supply, completely empty the tank and remove the water line. Remove the two or three bolts holding the tank to the toilet bowl. Turn the tank upside down and remove the large nylon or brass nut that holds the flush valve to the tank. Install the new flush valve. Be sure the tank bottom is clean and no debris gets between the new valve’s rubber gasket and the tank. Tighten the large nut on the outside of the tank and you are ready to reassemble the tank and bowl and put the toilet back into action. When reassembling the tank to the bowl, install new rubber washers and bolts.

son designated in writing by the tenant to be contacted by the landlord in the event of the tenant’s death.

The abandonment notice must be mailed to ALL of the following three parties: the deceased resident, at the rental address; any heir, devisee, personal representative or designated person known by the landlord, and the “Estate Administrator of the Department of State Lands” You must allow the heir, devisee, personal representative and estate administrator the opportunity to remove the personal property if they contact you within 8 days of mailing the notice and provide reasonable evidence that they are in fact the heir, devisee, or personal representative or estate administrator. With the help of the police, establish a list of individuals authorized to enter the unit. Request the ID of anyone who arrives to remove the personal items to verify their identity.

If they need a few extra days, that’s fine, but establish a date in which the unit will be back to re-rent. If the next of kin want to continue to control the unit, rent will need to be paid. Also, if the tenant left unpaid rent, notify the estate of this and when the next rent payment will be due.

If property is unclaimed it should be auctioned and the proceeds sent to Department of State Lands Unclaimed Property. If a balance is less than $5,000 that amount can be counted toward tax losses. If the balance owed is over $5,000 you may wish to pursue the estate.

Some circumstances require a public response. In the case of a violent death, consult the police on the proper procedure to inform residents. Make the response timely to calm fears, within 48 hours. You may also want to organize a

Dear Maintenance Men: Can I get some pointers with preventive maintenance when it comes to heating and air conditioning?

Mike Dear Mike: Heating and air condition or HVAC should be inspected at least twice a year or at the change of the major seasons such as summer and winter. Prior to summer or winter seasons, it is essential to properly inspect and troubleshoot your HVAC (a/c)units whether they are window, wall or central. Most A/C units fail or work improperly due to nonexistent or improper maintenance and not age.

Cleaning is your A/C is the most inexpensive and critical maintenance procedure you can perform.

Here is our 4-point check list: 1. Turn on the A/C and listen for unusual noises.

2. Inspect/clean or replace filters. Filters should be cleaned or replaced at the beginning of each major season, such as before summer and before winter.

3. Clean & repair damaged or bent fins.

(They can constrict proper air flow and decrease the cooling capacity of the A/C unit.

4. Clean out all dust and debris inside of the A/C pan or coils.

On a central HVAC unit: cleaning or replacing the main and return filters, may be the limit on a DIY cleaning. A qualified technician should do any other work on a central heating and air unit.

Bio: Please call: Buffalo Maintenance, Inc for maintenance work or consultation.

JLE Property Management, Inc for management service or consultation Frankie Alvarez at 714 956-8371 Jerry L’Ecuyer at 714 778-0480 CA contractor lic: #797645, EPA Real Estate lic. #: 01460075 Certified Renovation Company www.BuffaloMaintenance.com www.ContactJLE.com www.Facebook.com/BuffaloMaintenance

neighborhood watch or ask the police to drive through more often for the weeks after the incident. In higher crime areas, it may be a good investment to hire a security company to increase the visible security on the property.

In cases where a long term and/or much loved tenant has passed you may want to express your condolences to the surviving family by sending a sympathy card and allow fellow tenants to pay their respects by staging a community get-together honoring the life of the tenant.

Summary A death in a unit is typically an unplanned event, often a traumatic one in cases of a suicide or a murder.

This creates an environment of uncertainty for the on-site manager, the neighboring tenants and the property owner. Communication is important; so is humanity. Though the unit may remain vacant longer than anyone would like, showing compassion to family members who may not have anticipated the travel or storage of the deceased’s property, not to mention the loss of their loved one, is more important that a timely turn.

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www.americanleakdetection.com Rental Housing Journal Metro · July 2016

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Rental Housing Journal Metro ¡ July 2016