Like last year, 2021 was challenging in some respects and great in others. Although the year saw increased maintenance and repair costs, we implemented new technology to offer an improved marketing package and showing process. These changes allow potential tenants to accomplish most of the search process without having to be in close contact with someone during COVID. Looking beyond COVID, this also saves both our staff and interested tenants a lot of time as there are less showings of properties that they are immediately not interested in.
Improved customer service
Carol joined our team this year and has been working remotely with us for about 3 months. She has been helping tenants with applications while learning our processes and procedures. Carol is available to answer simple questions about things such as leases while Jon is on the road or at properties.
Carol has over 10 years of experience in the property management industry and helped her family with their rental properties in Utah. Having worked for HVAC, insurance, and plumbing companies in the past, Carol brings her extensive knowledge and experience to our team. She is a valuable resource to you when it comes to maintenance issues with your rental property.
Our communications response was already good, but we are always looking for ways to make your experience better by offering superior customer service. Carol looks forward to answering the questions you have in a timely manner.
Eviction moratorium update
The eviction moratorium seems to be over, at least for now. There is always the possibility that if COVID cases significantly increase, they could push the evictions off again. However, Kent County, Michigan has recently hit higher COVID rates, yet we have not seen evictions being pushed off yet. Based on our experience, judges are allowing evictions for now. Keep in mind it does take longer to get into court than pre-COVID times, but we are pleased it is an option again.
When a tenant hasn’t paid rent or hasn’t moved out, we notify our attorney to file a Writ of Eviction. It is taking longer than normal for that process to happen. In the past, it took about a week for the attorney to get it signed by a judge. Currently it is taking anywhere from two to four weeks to complete the process.
Thanks to the availability of CERA funds, we have not faced any of the major eviction issues that were predicted. CERA funds are slated to go away in 2022. We aren’t sure exactly when that will occur but have seen rumors of it being anywhere from March to October of next year. There is always the possibility that it will be extended.
If we do need to do an eviction for one of your tenants, we file our side of the application for CERA funds quickly. Our goal is to start that process immediately, so we don’t have to evict anyone.
Using Updated Technology
We continue to invest in improving our technology to
create an even better client/resident experience. Our goal is to have the best marketing package out there for rental properties and to make the showing and application processes as frictionless as possible.
Matterport 360 tours
Pre-COVID, we had begun offering Matterport 360 tours. This allows potential tenants to walk through the property from the comfort of home. This became an even more attractive way to market our clients’ properties during COVID. From the comfort of home, people can prequalify the properties they are interested in seeing in person. This technology allows us to get your property in front of more people quickly. That leads to less time on market.
A special 360 camera is used to record a walkthrough of the property which allows anyone in the world to tour the home. These 360 videos give a better perspective of the layout of a property than just photos. It is an easy way for people to prequalify a property they are interested in, which save them as well as our staff time. We are only showing properties to people who are extremely interested. It can quickly eliminate unnecessary on-site tours where people immediately don’t think the layout of the home. People love the ability to take the virtual walkthrough so they can narrow down the properties they want to schedule a viewing for. This has been a very appealing point of difference for us during COVID. We have even had people lease a property just from watching the 360 video, so it is a powerful addition to our marketing.
According to Zillow, residents want to know the sizes of bedrooms. In 2022 we are going to test that by including that information and see if that helps fill the properties faster. The 360 Matterport videos have a handy tool that you can use to measure a room. It is very accurate (to 1%). We did some testing with the tool, and it was very simple to measure the size of any wall, opening, etc. This tool came in handy recently as we were able to measure a basement for furnace work to get a quote.
This year we started using keypad deadbolts, and our residents love it. It’s more secure during the showing process because there’s no key. Better yet, it doesn’t cost you, the owner, anything extra. It is a win-win-win for everyone with saving time spent on the road. It also gives potential tenants the ability to tour a property on their own time without having to be in close contact with anyone.
We are always looking for the next big thing that provides value at a fair price or that we can implement without charging extra.
Price Increases Due to Inflation
We are seeing inflation effect the cost of products and labor, and don’t anticipate that going down in the next three to six months.
Vendor labor costs are up
Some of our vendor labor has recently increased in price. For example, one vendor changed their rates from $55/hr to $65/hr. This is in part due to a labor shortage. Good vendors that work well with tenants are hard to find. Luckily our general maintenance vendor has kept his rate the same, so the increase in maintenance costs has only slightly been impacted.
Appliances are more expensive and less available
If you have had to replace an appliance in the last few years, you know the prices continue to increase and the models in stock can be very limited. If you can’t wait for your preferred model to be in stock, you may have no choice but to select a more expensive option. We have a good inventory of the make and model of appliances we prefer to use, but there have been times when they are hard to get. If that is the case, we may have to put a nicer style in because that is all that is available. Refrigerators especially can be hard to get and can have a waiting time of several months. When waiting is not an option, a more expensive model may be the only choice.
With material and labor increases, roofing costs have also risen significantly.
Think you are going to need a furnace or water heater in the next year or two?
If it’s just a general swap out, I would suggest we do that sooner as opposed to later. Every month I hear from our vendor that their material cost for them has gone up. Our vendor shared a story with me earlier this week that the boiler they put in a larger multi-family property is on back order 12 weeks out. They had to source a different boiler just to get one. Because it is harder to get some parts and appliances, costs will reflect the increase in demand. Getting your preferred appliance make/model may take several months. If you can plan and replace it before it is urgent, consider doing that now.
These parts increases and shortages also apply to HVAC and water heater repairs.
We are doing our best to minimize turnovers and keep good paying tenants in your property. Like I mentioned earlier, we have tried our best to keep our maintenance costs from significantly increasing. However, when a part is in needed to repair a system or appliance, that is where you will feel the increase the most.
Rent Rates, HOA, Property Tax, Property Insurance
We have heard that all these expenses are up this year. We don’t physically pay those on your behalf, but those may increase due to property values going up.
We are doing our best to raise rents to market rate while keeping them a fair price. We are walking a fine line because we do not want rent increases causing good tenants to leave.
Now the Great News
Property values continue to rise in the area, and that is always good news for any real estate investor.
This year has challenged us, and we responded by using technology and streamlining processes. It pushed us to be a better company, and I hope you have seen the improvements.
Thank you for trusting us with your investment property. We’re happy you’re with us, and we look forward to offering you superior property management service in 2022.
If you have any questions, feel free to reach out to Jon at firstname.lastname@example.org.