Importance of a Sound Management Process
We at Stone & Browning Property Management have been very busy lately. Currently my company manages just under 100 units in the Central Vermont area. I wanted to use this blog to update you on our most recent project we took over in November 2015. For confidentiality reasons I will not be using names or disclosing addresses.
The portfolio we took over was comprised of 3 buildings totaling 19 apartments. There was a healthy mix of 1,2, and 3 bedroom apartments. The property owner was an out of state investor who had tried his luck with other management companies and had not seen the success he was hoping for. There was a large amount of deferred maintenance, drug issues, a long list of delinquent tenants, and to top it all off, 9 of the units were vacant with 3 more becoming vacant within a month of Stone & Browning taking over the management. The buildings had the potential to be collecting about $14,000-$14,500/month in rent however, the previous property manager had only been collecting $6,000-$7,000/month for the last year!!!! Needless to say this property owner was not getting the return on his investment he has planned on. Now, you may be thinking, "why in the world would you guys ever take over management of these buildings that appear to be a lost cause?" The answer is simple. My company has developed tried and true methods pertaining to all areas of owning and managing rental property. We looked at these buildings and knew that due to the amount of deferred maintenance the buildings were lacking "curb appeal" both internally and externally. On the exterior, there were leaves blown into all of the corners of the buildings, trash surrounding the walkways, the lawns had not been maintained and cut in months, there was chipping and flaking paint, and the buildings had not be pressure washed in what looked like years. On the interior, the common areas had not been cleaned, there were cigarette butts on the floors, the empty units had piles of junk left over from previous tenants, dirt lined the walls, mystery smells filled the air, appliances were broken, and the plumbing was troublesome with leaks coming from almost every faucet and drain. It was pretty obvious why none of these apartments were renting and we knew just how to fix the issue! While the owner wanted us to wave a magic wand and fix everything yesterday, we explained to him it was going to take time and an investment in his part to get the buildings up to par. To top it all off, the previous property manager didn't know who had paid rent and who hadn't, what units were vacant, which tenants were working with a housing authority, etc. Needless to say, there were many administrative issues in addition to issues with properties themselves.
First order of business was to get a handle on who the current tenants were, what they paid in rent, if they worked with a housing authority, and who was delinquent with their rent payments. Once that was complete it was time to get a cleaning and maintenance crews into all of the empty units. We had trash haul out companies, cleaners, electricians, HVAC guys, plumbers, floor covering guys, even a pest control company in the mix; all working to get these properties rent ready as fast as they could. We then went through and took updated interior and exterior images and made some appealing ad's that we uploaded to all the top websites like Zillow, Trulia, Hotpads, Apartments.com, Craigslist, etc.
Fast forward to today: February 19th, 2016. Our current rent rolls shows us collecting $14,418/month in rents. All of the big maintenance issues have been addressed and we are beginning to plan for future upgrades and renovations. These projects will take place as tenants move out. All the tenants except one, who was present before we were hired, are current on rents. The property owner is beginning to catch up on his delinquent bills and everybody is happy. I cannot stress enough the importance of curb appeal, and developing a sound rent collection process as well as handling maintenance items quickly and professionally. As stated in a previous blog, one of the biggest reasons tenants move out is because of on going maintenance issues that are either ignored, or receive the "quick fix" method. In a matter of three months we managed to repair/renovate, clean, and rent out 12 apartments, while also getting control of delinquent rents and bills. While there are still on-going maintenance issues that arise unexpectedly, the buildings as a whole are running much better and generating a substantially larger amount of income. The owner is now able to relax and enjoy time with friends and family and no longer worries about his buildings because he knows they are in the capable hands of Stone & Browning Property Management.