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Wednesday, June 14, 2017

Golden State Warriors's Recipe for Property Management Excellence




The Golden State Warriors won the NBA Championship!  They displayed a level of dominance that the league had never seen in its history by winning 16 out of 17 games in the playoffs.  And in the only game the Warriors lost, the Cleveland Cavaliers had to set several offensive records to beat them.

 

How did they do it?

 

The easy answer is the players.  They certainly have great ones- Charlotte’s own Steph Curry, Kevin Durant, Klay Thompson, Draymond Green, etc.  With that amount of talent, it could be argued that they could win by managing themselves.  From a property management perspective, if you have great tenants who pay rent on-time without being asked and do their own repairs, it makes the job much easier!

 

But there is something to be said about the ownership group and management (including coaches) that make for a winning organization.  It is truly a top-to-bottom effort to become a champion.  Ownership and management need to be supportive of each other and have a common vision.   

 

Owners Supporting Management

 

The majority owners, Joseph Lacob and Peter Guber, treat their employees and players well.  When their head coach, Steve Kerr, had back problems the last 2 years (which caused him to miss half of last season and most of the playoffs this year) ownership showed unwavering support.  They put no timelines on his return; they just wanted him to come back when he was ready.  There was no coaching change controversy.  They believed Coach Kerr was the right man for the job and he’s brought them 2 NBA Championships in the last 3 years.

 

Property management can be viewed the same way.  Property managers work for home owners.  And sometimes property managers make mistakes.  We recently had a longer term tenant who we believe started running an illegal business out of the rental home; we don’t know why and exactly how it started.  However, instead of getting angry and blaming us, the owner offered support as we worked to get the tenant out of the home as quickly as possible. We do our best, but will inevitably fail at some aspect of management.  Having ownership support gives us the ability to do what needs to be done to right the ship and get back to a profitable equilibrium.

 

Owners Making Strategic Investments (aka Spending Money)

 

When the Warriors fell short in the NBA Finals last year, management felt they needed to improve the team; that meant spending and reallocating money on other players.  With complete ownership buy-in, management went and signed Kevin Durant to a $54M guaranteed 2-year contract in the offseason.  They were willing to spend money to potentially get better.  There was no guarantee that Durant would mesh with the existing players (who had already won a championship 2 years prior without him).  But they spent the money anyway.  And Durant wound up winning the NBA Finals MVP!

 

Property management is no different.  No one likes to spend money; I certainly don’t enjoy spending money on my personal rentals.  But strategic investments are necessary to maintain and improve rental properties to keep them competitive against other rentals.  When property managers make recommendations to spend owner funds, it is difficult to win when there is constant owner pushback.  I guarantee Golden State ownership had financial questions about investing in Kevin Durant, and that is understandable!  But no organizations can succeed in the long haul by practicing persistent parsimony (how’s that for alliteration!).  And, really, it is much easier to not recommend needed maintenance and upgrades.  The Warriors only missed winning the NBA Championship last year by losing Game 7 (so close- and they were even up 3-1 before eventually losing)- but everyone in San Francisco is ecstatic now that the organization didn’t rest on its laurels and aggressively pursued Durant.

 

The Golden State Warriors and successful property managers share a common recipe for consistent excellence- owners and management working together to make smart decisions for the long haul. 

 

Happy Landlording!

 

Brett Furniss is a property manager at BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management.   BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area.  Contact Us Today!

Wednesday, May 10, 2017

Rental Home Marketing: Kim Kardashian or Jennifer Lawrence?




“There are pitfalls, lack of privacy, loss of privacy, and that’s not for everyone. For me, I can handle it.” Kim Kardashian (60 Minutes, October 2016)

“I teeter on seeming ungrateful when I talk about this, but I’m kind of going through a meltdown about it lately. All of a sudden the entire world feels entitled to know everything about me, including what I’m doing on my weekends when I’m spending time with my nephew. And I don’t have the right to say, ‘I’m with my family.’ … If I were just your average 23-year-old girl, and I called the police to say that there were strange men sleeping on my lawn and following me to Starbucks, they would leap into action. But because I am a famous person, well, sorry, ma’am, there’s nothing we can do. It makes no sense … I am just not OK with it. It’s as simple as that. I am just a normal girl and a human being, and I haven’t been in this long enough to feel like this is my new normal. I’m not going to find peace with it.” Jennifer Lawrence (Vogue, September 2013)

So, fame is a  mixed bag.  So many people work to be rich and well-known, and then realize they just want to be residential property managers (OK- not true- but it sounds like Jennifer Lawrence may potentially be convincible if we were able to get her at her lowest point).

But who cares about us?  What about our rental properties?  Should they be like Kim Kardashian, “handling” (if “handling” and “relishing” now mean the same thing) the pressure of being well-known?  Or like Jennifer Lawrence, shunning the spotlight?

In Kim’s world, our property manager is a marketing dynamo!  The rental property is on every website imaginable!  We see people using our marketing ad as a screen saver.  The magazine racks at the grocery store have publications with our property in there!  #502THEMainStreetCharlotte is trending and its master bath has its own Twitter handle!  Strangers are liking our home on Facebook and we’re getting rental inquiries from abroad!  Strange men are following our employees to Starbucks to get the inside scoop (“It even has dual vanities???  Crown molding!  I couldn’t even tell from the revealing Instagram photos!”)!  The management office looks like it is having a telethon. 

In the J Law (as the insiders refer to her as) world, the rental property would be left alone and no one would even know it was available..  “Shhh… it’s a pocket listing, I think.”  The only way to find it is to do an exact address search on www.BDFRealty.com (and if you mess up on spelling or spacing, you’re probably out of luck…).  Digital tumbleweed blows through your rental ad’s corridors.

So the Kardashian marketing method, though unnecessarily audacious, is probably the best plan to get a good renter quickly.  But what about if your rental marketing is producing the privacy J Law craves and is your new normal?

Try these things:

  1. Google “rental homes in your town” and post the rental ad on the top 3 websites that allow you to do so.
  2. Get the property on the local MLS that Realtors use
  3. Put a sign up in the yard
  4. Post the rental to your social media accounts

Here’s a bonus: make sure your property maps correctly on MapQuest and Google Maps.  We’ve occasionally run into some J Law results in our marketing, and upon some research, realized that the mapping companies had the rental property showing up on an ISIS air field (OK- not really- but you get the point).

“There’s only one thing in the world worse than being talked about, and that is not being talked about.” Oscar Wilde


Keep up with the Kardashians and Happy Landlording!

Wednesday, March 29, 2017

Trump’s Cabinet Means You Should Invest in Charlotte Real Estate




The stock market will always go up eventually.  Historically, it keeps happening.  Most wealthy people (aka the people who make the rules- check out Trump’s cabinet of billionaires) have much of their wealth tied up in corporate ownership (stocks).   It’s almost a sure thing.  If the stock market crashed and stayed down permanently, our country would be in mayhem.  And the dollars under the pillow and gold bars stashed in the attic wouldn’t mean much.  Food would be the main currency.

So why do investors get fearful when the stock market goes down?  It will go back up, right?

After 9/11, the stock market tanked.  Billionaire New York City Mayor, Mike Bloomberg, had a message for his constituents.  He essentially said,” People always ask me for investment advice so they can become billionaires.  I don’t often offer it, but today is different.  Take all of your available money and buy stocks now.”

The Dow dropped to under 9,000 in 2001, and almost to 7,000 in 2002.  It is now over 20,000.  Too many powerful forces have a vested interest in the stock market doing well for it to flounder long.

Charlotte’s population is forecasted to go up 50% in the next 10 years.  All of those people need a place to live.  Statistically, 2/3 will buy and 1/3 will rent.  Housing demand will continue to drive rents and prices higher.

So, investing in real estate in Charlotte is a slam dunk?  As much as investing in the stock market is, especially with a Trump administration.

So that leads to 2 questions:

  1. When is a good time to buy in Charlotte?
For long-term holds, anytime really should be fine.  The best time to buy is when the market gets hammered (see 2008-2012 when we didn’t get many buying inquiries, but many of our clients were looking to unload their homes and became reluctant landlords).  For short-term holds and flips, this might not be a great time as competition is fierce for good properties; it’s clearly a seller’s market now.  But financing is easy and historically cheap right now.

  1. Where should I buy in Charlotte?
Once again, for long-term holds, anywhere within city limits will work; really the surrounding counties seem pretty good too.  When I was a newbie investor 10-15 years ago, my first two purchases were in areas that were considered “war zones”.  I bought them very cheaply ($27K & $39K) and now they are considered to be in “hot areas”.  Note: I wouldn’t recommend this, especially for newer investors.  The fix-up and tenant issues were challenging and I wished I didn’t own them for years due to the headaches.  But there are plenty of Charlotte houses that are in better areas that will make coveted rentals for years and years.  I’d recommend buying houses that are more expensive (the market is pretty good at pricing houses based on risk).  The homes I bought over $100K were much easier and safer investments that have also appreciated.

Much like investing in the stock market as a whole, Charlotte real estate is a great long-term hold that doesn’t require a large amount of analysis.  And Trump’s cabinet members (and President Trump himself) own a lot of real estate too… 


Happy Investing & Landlording!

Tuesday, January 31, 2017

Rudy is a Great Movie, Just Not a Great Rental Application




Rudy Ruettiger (aka “Rudy”) was the subject of a great movie in 1993 about his improbable story of getting into Notre Dame and then playing on their football team.  It’s a true testament to the human spirit as he played high school football (not recruited), went to the Navy for two years, worked at a power plant for two years, and then after not getting into Notre Dame for low grades, went to Holy Cross College for two years before being admitted to Notre Dame on his 4th try!  Whew!

Then he walked on to the football team and made it(!), got beat up on the scout team every day at practice, and then got on to the field his last game and picked up a sack.  What a story!

Of course Hollywood embellished the story a little bit as Joe Montana, a freshman quarterback at Notre Dame at the time, said in an interview.  No players were taking off their jerseys demanding that Rudy get in the game, it was typical for seniors to get into the last home game, and the players carrying Rudy off the field in triumph were just playing around.  And Rudy’s legendary work ethic?  “He worked his butt off to get to where he was and do the things he did.  But not any harder than anyone else,” Montana said.

The truth is that Rudy should have never gotten into Notre Dame due to his bad grades (4 tries!  Where did he get the money to pay the college application fees?  Does “no” ever mean “no”?  Did he finally get an admission officer who was napping?).  He never should have been on Notre Dame’s football team (He was 6 years older than everybody else.  He was 5-foot 6 inches tall and 165 pounds!  He’s lucky he didn’t get killed in practice.).  “Rudy” should have never happened and a movie was made about him because somehow it did.

As a Charlotte property manager, we sometimes get rental applications that I feel might have been inspired by Rudy.  And I’m not saying that to be mean.  I really feel that if we approved some of the applications we received, we’d essentially be ruining the applicants’ lives.  For example:

We had a rental house on the market for $1,400.00/month.  We received an application where the prospective tenants had several credit cards almost maxed out, they had been late 8 of the past 12 months on rent, and the rent they were currently paying was $1,000/month on a smaller house.  How was adding $400.00 in additional rent (not to mention higher utility costs for a bigger house) a responsible move for anyone- landlord or tenant?  It would just have made life much harder for everyone.

Even as romanticized as Rudy was, the chances are no one would have wanted Rudy’s life prior to running through the tunnel and getting into his one Notre Dame game.  He was studying all the time to pass classes that were too difficult for him, while walking around with a beat-up body from banging into guys that were too big and strong for him to compete against.

Rudy may have learned character, perseverance, and many other worthwhile traits (while being the subject of a great movie!), but it was a hard journey.  He was able to walk away with a Notre Dame degree, a great memory, and a lucrative speaking career after the movie came out.  But I’m not sure there are any rewards for taking on more housing payment than one can afford.  It’s stressful, and hurts families and relationships.  Usually, it leads to evicted tenants and fired property managers.

We all want to root for the underdog, but Rudy is best seen in the theaters and not experienced in real life.  Denying unworthy applications can sometimes be a great act of kindness.


Happy (& Responsible) Landlording!

Thursday, January 5, 2017

The Rental Bachelorette: What is She Looking For?





"I would just want someone who is genuine and makes me laugh and is my best friend and ultimately someone who is going to love me as much as I love them.”
Former Bachelorette JoJo Fletcher

JoJo apparently found that “someone” in the arms of NFL quarterback Aaron Rodger’s brother, Jordan, in the last season of the Bachelorette (so says the cover of a tabloid magazine next to Harris Teeter’s cash register).  Good for her!

Many people have differing ideas on what women want from prospective male suitors.  I’ve seen some lists as short as:

  1. Rich
  2. Good-looking

This list is written for the rich, good-looking guys typically by the less rich, less good-looking, jaded guys.

And there are some deeper lists written for the less affluent, average-looking guys (who might buy magazines with articles like this).  This “Top Ten” list is courtesy of www.topyaps.com:

  1. Not being desperate or clingy
  2. Being a friend first
  3. Manners & hygiene
  4. Respecting her space
  5. Chivalry
  6. Sincerity & loyalty
  7. The ability to protect
  8. Sense of humor
  9. Intelligence
  10. Honesty

Wow!  That’s a much tougher list to mull over.  At first glance, it seems like I’ve blown it in the past by actually following items #1 and #4 by “not caring” and “being distant.”   But I digress…

As a Charlotte property manager, this is a question we get often from potential tenants:

“Before I spend $75.00 on a non-refundable rental application, what are you looking for?”

The three things we are looking for in potential tenants for our properties:

  1. Pay rent on time: #1 criteria
  2. Maintain the property: change air filters, mow the lawn, make reasonable repairs on your own, etc.
  3. Get along with the neighbors (and property manager!)

If tenants can do these 3 things, we will like them a lot and the tenancy should go very smoothly.

Tenants do not need to be rich or good-looking, but we’re always impressed with chivalry and a sense of humor.

Happy Landlording!


Brett Furniss is a property manager at BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management.   BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area.  Contact Us Today!

Friday, December 9, 2016

Cash Bloodletting from Rental Home Subletting




A house on my street is a rental home.  The owner had a long term tenant who always paid on time and was an agreeable guy.  It seemed like a good situation.

However, every few months I would see moving trucks parked in front.  I wondered if the tenant was moving out, but sure enough, days later I would still see his human size dog running out his front door (as I would shield my 2-year old son from his “affections”).  The tenant hadn’t gone anywhere.

So what was going on? 

The tenant was a serial subletter.  He would rent out rooms to strangers.  It seemed like a good way to make extra cash being that he travelled a lot for work and lived alone (besides the aforementioned gigantic dog). 

But something went really wrong recently.  The tenant didn’t click with the newest subletter and they got in a physical altercation due to undone housework.  His dog attacked the subletter (poor guy!) protecting his owner and the subletter needed an ambulance.

An ambulance, several police officers and animal control showed up at the house and the subletter wound up getting a restraining order against the tenant.  Now the tenant was not allowed to go to his rental home.  I had a new neighbor, and not one who was actually on a lease.  However, due to the legal system, he had rights to the house and the tenant was essentially homeless because of the restraining order. 

It was a mess for the owner.  The subletter had to be evicted (which took a month or two) and it left the owner out thousands of dollars. 

So, is subletting evil?

Generally-speaking, yes, I wouldn’t recommend it.  However, if done properly, it can work well to keep a house occupied.

The two ways to avoid subletting bloodletting:

  1. Be involved.  If a tenant wants a subletter (and this is applicable for any new home occupant), a rental application needs to be run.  Owners need to know exactly who is going to be living in their rental home.
  2. The new occupant needs to be on a lease and the security deposit situation needs to be addressed (who has rights to it now?).

As a landlord, it’s easier to just let tenants do their thing as long as rent is coming in (like in this instance where it happened for years without incident), however it can come back to bite (pun intended).
As a Charlotte property manager for many years, we’ve picked up many good tenants from allowing tenants to add additional occupants to their lease.  However, we’ve never budged on the two criteria above.

Don’t let subletting turn into a mess.  Control the situation, run a rental application, and (if approved) get them on a lease!

Happy Landlording!


Brett Furniss is a property manager at BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management.   BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area.  Contact Us Today!

Thursday, October 20, 2016

Love, Kindness & Gratitude: Setting the Tone in Property Management





Beloved, let us love one another, for love is from God, and whoever loves has been born of God and knows God. Anyone who does not love does not know God, because God is love."  I John 4:7-8

Man, it’s nice when people are nice.

 

We have a tenant, Monica, who just goes out of her way to be easy to work with.  If we need her to do something for us, she does it.  There is no complaining, back biting, or procrastination.  Communication with her is a joy.  And she is soooo nice and gracious.  When we perform repairs (aka our job), she is so gracious and thankful.  Her rent is always on time.  She and her family go out of their way to perform maintenance to the house.  And at the end of her positive and funny e-mails, she always includes the Bible verse above.

 

We have another client, Mike, who goes out of his way to compliment us for working on his home; once again, for just doing our job.  Small things don’t escape his notice.  His level of graciousness is astounding.  Truthfully, we should be thanking Mike much more than he thanks us.  We made a good amount of money working for Mike: we helped him buy houses, repair them, manage them, and finally, sell them.  These are all things we collect fees for.  But he would let us know how much he appreciated our efforts, even if the work was imperfect at times.

 

I think back to how our relationships started.  It would be easy to say that they were “good folks” and that they get along with everyone (they probably do!).  But why? 

 

They set a positive tone with us early.  Early conversations were easy, paperwork was complete and accurate, and meetings were punctual.  They were easy going about details as we got to know each other.  They got the things they needed from us, but their requests were made in a graceful and kind manner. 

 

Property management can be a difficult business.  At the face of it, a property manager is the middle man between two parties with divergent interests, the owners and tenants.  Both would prefer that the other party pay for anything that breaks.  The owners want the rules of the lease followed precisely to protect their investments, while the tenants want to use the house as they see fit.   The property manager is hired by owners and is tasked with protecting their investments, but can’t get it done well without tenant involvement and buy-in.  It’s a balancing act that produces many colorful (and costly) stories of when the relationship breaks down.

 

But Monica and Mike also show that it can be a rewarding business with warm relationships. 

 

As the property manager, our job is to always set the tone early with kindness, love, and gratitude.  The tenants need to feel this from us, their point of contact, from the moment of their first inquiry.  Even if we wind up having to reject a tenant application, we can do it kindly.  But if we wait for the clients to set the tone, it might not happen.  And it needs to.

 

So set the tone early!  This will allow landlords to reap the benefits of a mutually fulfilling partnership and make property management a joy.

 

Thank you to our clients (Monica, Mike & many others) who make coming to work a pleasure.

 

Happy Landlording!

 

Brett Furniss is a property manager at BDF Realty (Charlotte Residential Property Management), the trusted real estate advisor for Charlotte landlords & Home of $100 Flat Fee Property Management.   BDF Realty utilizes their innovative Pod System for exceptional customer service in residential property management, home repairs, and home sales for single-family homes, Uptown condos, and town homes in the Charlotte-Metro Area.  Contact Us Today!