Archive for Portland property management

5 Tips To Choose A Portland Property Management Firm

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When you have decided to rent out your home or rental property the services of a Portland Property Management Company come in handy. These companies are often the most efficient solution to get your property rented. Many professional real estate investors rely exclusively on the experience of Portland property management firms to create passive monthly income. There are different types of firms and services and you will definitely need to know what your exact needs are.

#1 Tenant Finder Or Full Service

Decide if you want to have screened tenants provided for you or if you want a complete hands free solution with a full service firm. The full service Portland property management firms will advertise your place, find and screen tenants, maintain the property and collect rent on your behalf. These firms tend to charge a one time fee and a percentage of the collected rent each month. On average the fees range from 5% to 10% of the rental value. Services that only focus on finding tenants charge a one-time fee that tends to be equal to one month of rent.

#2 Know The Rental Comparables For Your Neighborhood

It is absolutely crucial to have accurate knowledge with respect to the going fair market rental value in the area where your property is located. While it is only natural to want the rental income to satisfy the mortgage do realize that this is not always possible. Decide what the maximum rent is that you can request for your property that will still help you satisfy the mortgage, one thousand dollars towards a mortgage will always be a huge help.

#3 Get References

There are many Portland property management firms, make sure to research these thoroughly. Look at the websites and check how long these companies have been in business. Read their TOS (terms of service) carefully to understand the full scope of what they offer. Do some research with the Better Business Bureau and make sure to ask others for references. Make sure that you feel comfortable and confident with the service that you will be provided.

#4  Review Your Portland Property Management Agreement Fees

Ask to see a copy of the management agreement/contract in advance and feel free to have your lawyer review this agreement. Fully understand all of the penalties and fees in the event that you have to break your contract. Make sure to ask about each fee and what the fee includes. Does the Portland property management company provide free advertising, discounted advertising or are you paying for the advertising on your own? Check to see how much time you are locked in with the firm, you may find later on that you want to change companies, or that you want to manage your own property. Some property management firms charge five to ten percent of the monthly rental income. Some property managers charge you for each visit to the property. Make sure that you are clear on all of the fees.

Call around and take careful notes, by calling several you will have a clear idea of the going rates. Is the property manager also paid on empty property? You want to avoid managers that may be desperate to rent your property only to collect their percentage. You do not want a tenant that destroys  your property as you are the only one responsible to pay for the damages to your property. Request to approve your tenants beforehand. Know that the five percent rates could charge  higher back end fees. A firm may charge five percent if they only collect rent, but if they handle repairs or check references, they may charge an hourly rate which would quickly surpass the percentage rate. Shop around and compare.

#5  Review Their Collections Process

Make sure to ask if they have an on staff lawyer or if they have a contract with a law firm that specializes in real estate. Should your tenant refuse to pay rent you want to know that your Portland property management team has the experience to represent you in court and to collect the rent that you are owed. How does this company handle evictions and how much experience does this company have with tenant evictions?

Consult with a professional Portland property management expert to discuss your expectations and plans. The current economy proves to be a fabulous time to invest in real estate with the foreclosure market offering tremendous savings. To learn more about making real estate investing your source of passive income call (503)539-9094 or visit http://howtoinvestinrealestateportland.com.

5 Tips To Choose A Portland Property Management Firm

Portland Property Management- Making Intelligent Decisions

One of the safest places to live in the United States is Portland. Property management companies in Portland are experiencing an increase in the number of investors who are looking for portfolio diversification. Property management companies are able to offer stable and passive returns. Many national and international investors are choosing Portland for real estate investment.

Beautiful house under Portland property management

Having a property management company will save you a lot of time. These professionals can tackle the time consuming chores involved in property maintenance. Property managers handle much more than just the tenant screening process. They address preventative maintenance, scheduled maintenance, inspections and renovations. More importantly, they respond to emergencies which require immediate action. Due to their established networks, they can easily find quality affordable professionals to handle your property’s plumbing, electric, gardening, carpentry, drywall and heating needs just to name a few. Their experience will save you many headaches, as they will know how to best accommodate your tenants while saving you time, stress, and money.

In order to be successful as an investor, finding the right property management company is key. Many real estate agents looking to compensate their incomes will gladly offer to help you find a property and rent it out. Be advised that many real estate agents are only knowledgeable in terms of RESPA (Real Estate Sales Procedures Act); this is great when you are buying or selling a property, but you really need a knowledgeable and experienced professional whose main focus is property management. Experienced property managers understand and comply with legislation, such as the Americans with Disabilities Act and the Federal Fair Housing Amendment Act, as well as the Oregon Fair Housing Laws. They will be sure that the renting and advertising practices are not discriminatory and that the property itself complies with all of the local, State, and Federal regulations and building codes. Professional property managers will know the Landlord Tenant Laws, especially when dealing with evictions, non-payment of rent or harassment.  

Portland Property Management Woman Portrait PhotoIt is highly advisable that you interview various property management companies in order to determine their experience, history and knowledge. Not all property management companies are created equal, and as such, your true investment success will be determined by the professional that you hire.  When looking for a Portland property management firm, it is wise to to check that the company is licensed and registered with the state of Oregon. You can visit www.oregon.gov to verify that  the professional you are engaging is a licensed property manager. If your property manager is not an active licensee, he or she is operating illegally and you are not receiving the benefit of having the Oregon Real Estate Commission oversight. This extra step will provide you piece of mind. A registered property manager has undergone background examinations, drug testing, continuing education requirements, licensing examination requirements and has professional liability insurance.  

Why exactly does professional liability insurance matter? Statistics show that since 2002 the number of lawsuits in the real estate arena have escalated significantly. The biggest increase and largest claim type was directly related to property management. There may be times in which property managers may be involved in litigation with tenants or contractors. Thus, insurance coverage will protect the property manager from frivolous law suits while insuring peace of mind for both of you.  

Some property management companies even offer online owner portals. This allows you to have the leases, management contracts, financial reports, paid invoice copies, inspection reports and even inspection videos accessible online without having to contact the property manager. When you have the right property management professional working for you, your investment will work on autopilot.

Here is a list of questions that you should ask Portland Property Management firms

How many properties does the manager have under management?
How does the property manager handle repairs?
What kind of insurance coverage does the property manager have?
What is the company’s  Better Business Bureau rating?
Is the property manager a member of the National Association of Residential Property Managers (NARPM)?
Does the property manager accept electronic rent payment?
Does the property manager pay owners by direct deposit?
Does the property manager offer an online owner portal?

The National Association of Residential Property Managers (NARPM) is also a great source to help you find Portland Property Management firms.

Portland Property Management

Business Structuring – Making Money? Now Cover Your Assets

WARNING: DO NOT READ ABOUT BUSINESS STRUCTURING UNLESS YOU HAVE COMPLETED AT LEAST TWO SUCCESSFUL TRANSACTIONS

Business Structuring at IBM/Tabulating Machine Co. organization chart

Business Structuring Follows Profit

I’m not trying to be mean with the warning. I just don’t want you to waste your precious time focusing on things in the wrong order. Try dialing a phone number where you dial the area code AFTER you’ve dialed the 7-digit local number and see what happens. Order counts. I’m mentioning this topic now because chances are, once you’ve started actively investing, you’re going to start hearing horror stories of loss due to lack of preparation in business structuring.

So, let’s take a look at a few ways to structure your business to protect your family and personal assets from legal and financial liability, and to minimize your tax burden. Please note that I’m not a licensed CPA or attorney. I’m just sharing some of the things I’ve become aware of in my time as an investor. When you’re ready to CYA, I strongly urge you to get qualified help from a good local lawyer, accountant, and financial planner who understand Portland laws and tax structures. Here they are.

Business Structuring Types

  • Sole proprietorship
  • Partnership
  • Limited Liability Company
  • S Corporation
  • C Corporation

Sole Proprietorship

This is the most common, and cheapest, form of business structuring. It allows you to use a legal business name, and that’s pretty much it. There is no financial or legal protection of any sort. If there’s a problem, it comes down on you, your savings, your home, your car, your boat, and any and every other personal and real asset you own. However, you can start writing off business expenses, including a home office.

Partnership

Two or more people come together and share in the risks and the rewards of the business. Many single-property projects that are called joint ventures are in fact partnerships built around a single property. This is one of the reasons why you will see numerous investors who are in completely separate joint ventures with other investors. Each property is inside its own partnership agreement or other corporate entity.

Limited Liability Company

Many people mistakenly refer to this as a “limited liability corporation” but in fact an LLC is more like a partnership than a corporation. LLCs have become very popular in recent years for real estate investors, as they are less expensive and often require less administration than corporations, but still provide excellent liability protection.

S Corporation

The S corp is the “Small” version of the C corporation. It’s simpler to administrate than a C corp, but harder than an LLC. Similarly, the financial tax benefits kick in at a higher revenue level than an LLC.

C Corporation

The Daddy of all business structures, the C corp has the highest administrative burden, but generally provides the greatest legal and financial protection. Of course, you need to be generating something like $100K a year before this even becomes an option for most investors.

The best way to determine the business structuring right for you is to ask yourself a few key questions and share the answers with your mentor, attorney, CPA, financial planner, and marketing team or consultant (believe it or not, how you set up your business can affect how well you get found in Google, and how you market your services). After you’ve gotten all their feedback, then you can weigh the information and make the best decision for you.

Here are a few questions to consider, in no particular order (remember to invite input from your professionals as well):

  • How good are you at maintaining records?
  • Will your properties ever be occupied by tenants?
  • Will you be joint venturing/partnering with other investors, and if so, how often?
  • Will you be working from home, or from an office?
  • Do you own your own home or any other significant personal or real assets?
  • How much will you make from investing this year?
  • Will you be using your own funds to invest, and if so, what financial vehicles are the cash in?
  • Are you looking to get found online by prospective sellers or buyers?
  • Will you be engaged in construction or remodeling, personally or through subcontractors?

Proper business structure is only one side of preparation. In my free video “Seven Biggest Mistakes in Portland Real Estate Investing” at HowToInvestInRealEstatePortland.com I also talk about the members you want to have on your real estate investing “dream team.” So make sure you’re making money in real estate first. Then get your business structuring in order, make sure you are surrounding yourself with the best teams to protect your assets and to take your business forward, and you will enjoy peace of mind as well as wealth of household. Take action and prosper.

Business Structuring – Making Money? Now Cover Your Assets