Pros and Cons of Residential Property Management

The health and well-being of a property comes down to how effectively it's managed, and this tremendously multifaceted task requires an arsenal of knowledge that spans across people management, facilities, problem-solving, collections, accounts receivables, operations, and beyond. To do, or not to do; that is the question, and when owners finally take the leap in deciding to hand over properties to a company or person, a second decision awaits that impacts their investment significantly. Weighing the pros and cons of hiring a solo property manager versus a full-scale management company is a necessary step since both options have essential considerations that should be thoroughly analyzed.

Understanding the Property Management Role

From a property owner and investor perspective, the crux of a property management role is the ability to successfully strike a highly fluid balance between tenant relations, vendor management, and property income generation. This may sound simple, but each category is its own body of knowledge, and finding well-rounded management precision can be a challenge.

Property Management Company Pros:

One of many pros in working with a management company is that a larger group would have more resources to tap into to meet the full set of needs and challenges that come with managing a property. Proper licensing, and insurance coverage will likely also be more robust with larger companies. Many management companies are also equipped to cover the cost of evictions and can handle more complex finance and legal functions of property management.

Cons: Larger management companies often work more autonomously, but this could be either a pro or a con depending on how involved property owners want to be.

Solo Property Manager Pros:

Hands-on property owners who still want to be involved in some of the day-to-day property goings-on would likely be happier with an individual property manager. Even though this likely wouldn't altogether remove the owner from overall operations, it would still be a highly beneficial relationship and take the edge off of having to be on call 24/7. This would also allow property owners to get real-time data and insight about their properties.

Cons: Taking on independent contractors as property managers can be risky, and hiring an employee is a significant investment. Independent property managers may also be stretched between numerous properties and have fewer resources to handle legal issues and high-level finance duties. In a worst-case scenario, if a manager becomes unavailable, then property owners must be ready to take up the reins.

Weighing Your Options

Property owners should ensure critical criteria that could impact the property's integrity are heavily deliberated and then reconciled against the cost. Core competencies that are deal-breakers would consist of the following, and each category is potentially cultivated more precisely by either management companies or lone property managers.

• Ability to fill vacant units quickly: Management companies have the upper hand here and often have access to a wide range of market data, listing services, and communicative closing processes.

• Acumen needed to set the correct market price: Management companies have the upper hand here yet again because of the advanced data that is more accessible to enterprise customers.

• Vendor negotiation skills: Individual property managers win this category. Agile indie managers can discreetly get the best price, can spend more time building relationships with vendors, and will be able to leverage all of the perks smaller vendors have to offer. Larger companies may be restricted by labor laws, have pre-selected strategic partners, or have bulkier RFP processes that may or may not be in the property owners' best interest.

• Responsiveness and accessibility: Either category could win here, but a larger management company may have backup options to provide if, for some reason, a property manager becomes unavailable. Otherwise, property owners would need to pick up the slack.

• Elite tenant management relation skills: The success of this competency all comes down to finding the right person or the right company. Both need to be dedicated to tenant service.

• Impeccable attention to detail: Finding a rockstar individual property manager that is passionate about their work can add a special touch to your property.

A Formula for Success

Going with either a property management company or an individual manager for properties will ultimately come down to how much involvement the property owner wants to have and the complexity of the property portfolio. A potential formula to use (depending on budgetary restrictions) could be:

• High portfolio complexity + less owner oversight = Property Management Company.

• Medium portfolio complexity + less owner oversight = Employed Full-Time Property Manager

• Low portfolio complexity + increased owner oversight = Individual Property Manager (could be a contractor)

Putting together a matrix based on the current market climate that plots out the legal, marketing, and financial needs your property or properties currently require and may need in the future is the last piece of the puzzle that can provide finality and help property owners come to a final decision.

The Pros and Cons of Using Cash Home Buyers

You’ve probably seen, while out driving, one of those signs that reads, “we buy ugly homes.” If so, you’re aware, whether you realized it or not, of a burgeoning new internet trend called “Ibuying.” In the Ibuying market, homeowners can quickly sell properties to a variety of companies, such as Openbook, Orchard, Offerpad, and, yes, We Buy Ugly Houses, for cash in hand.

But just because you can do something doesn’t mean you should. Before you sell your home through an Ibuying agency, it’s important to understand how the process works, the pros and cons of selling via Ibuyers, and the people who are most likely to benefit by offloading a home this way.

How It Works

Ibuyers are designed to make selling your home quick and easy and to put cash in your pockets quickly when you need it. With slight variations, most companies work the same way. The process begins by the seller submitting a report online where they enter the address of their property and answer questions about the property, such as square footage, recent upgrades/renovations, appliances, and amenities. Often within 24 hours, the company will reply with a cash offer for the property. Be aware that many Ibuyers do not negotiate the price they offer, although a few do offer some mechanism for a review of price.

If the seller accepts the offer, then the company sends an appraiser to ascertain repairs that the house may need. The appraiser is employed by the Ibuyer and names necessary repairs as well as estimated cost of those repairs. The seller can negotiate costs and can usually opt to take on repairs on their own, but if they choose not to, the cost of repairs is deducted from the offer price. In other words, if a company offers you $175,000 for your home and appraises repairs at $25,000, then you will only receive $150,000 as the final offer. You can, of course, choose not to accept the repairs, in which case the contract is void.

It’s also important to be aware of a few other things. Most companies seek to buy only single family homes, duplexes, condos, and townhomes that cost between $100,000 and $500,000 and that sit on half an acre or less of land. Homes that don’t meet these criteria generally won’t receive an offer. Second, you will have to pay a number of fees in the cost of selling your home.

Pros and Cons

Not everyone benefits from selling to an Ibuyer. In fact, it’s advisable that you have knowledge of real estate markets and solid negotiating skills if you are going to enter into an Ibuying sale. If you feel like the process might be right for you, here are some pros and cons to consider.

Pros

• Speed: One of the most obvious advantages to the Ibuying process is the speed with which you can sell your home. Transactions can take as little as 14 days to a maximum of roughly 60 days. Gone then are months of waiting just to see if you get interest in your home.
• Ease: Ibuying takes the stress of haggling over price, overseeing repairs, dealing with agents, and waiting to see if a potential buyer qualifies for financing off of you.
• Immediate cash: If you’re an experienced seller, you can walk away with a reasonable amount of cash that can be used immediately.
• Offloading: For various reasons, some homes may linger on the market. If your home has problems that make it hard to sell, then Ibuying may be an excellent solution.

Cons

• Lost profit: before you jump at the potential for an easy sale, be aware that most Ibuyers offer 60%-80% of market value, and may take advantage of buyers who aren’t market savvy by drastically undervaluing a home. This can result in huge loss of profit on a home.
• High Fees: Ibuyers include a transaction fee that they explain as comparable to a real estate agent’s fee, which initially may seem true. Most companies fees start at 5%-6.5%, which compares to the average 6% agent’s fee. However, analysis shows that the average fee of most Ibuyers is 7-7.5% and can be as high as 14%, nearly doubling the cost. You will also see a fee for closing costs that varies between 1% and 4%.
• Repairs: Companies require that you use their appraiser who will decide what repairs should be done. You can negotiate costs of repairs and even do them on your own, but you can’t choose not to do them without negating the contract. Inexperienced home buyers may get hit with inflated repair costs to further cut into the buying price of the home.
• Appeal sales: Some homes have amenities that create competition for sales so that buyers who fall in love with the property actually offer above market value. While you save time with Ibuyers, you lose the opportunity to hook buyers who have fallen in love with your home.

Who Benefits

Those who are most likely to benefit from an Ibuyer sale are those who have significant property experience, who are good negotiators, and who have a need to sell a property quickly or who have tried to sell a property and been unsuccessful. Below are some examples of those who have benefited from Ibuying sales:

• Homeowners with structural problems or safety issues
• Sellers involved in divorce settlements
• An heir seeking to sell an inherited home quickly
• Someone who needs to liquidate to pay outstanding bills
• Individuals who are in foreclosure
• Those who have lost a job and need to downsize
• Those looking to move quickly, such as someone who has attained a new job

--

Ivan Young is a writer for Checkworks, a retailer for personal and business checks.

Navigating the purchase of your first home can be an uncertain and intimidating experience. As you begin the process of transitioning into home ownership it is important that you stay informed at every step of the process. Here are five questions that you need to ask your real estate agent prior to buying a home. Some of the questions may allow you more room to negotiate and others will alert you to potential problems down the road. All of them will help you be a more informed buyer.

Why Are They Selling?

While you may not get an entirely truthful answer, knowing why the seller is listing the house can be a powerful negotiating tool.

Is the seller moving out of the country? Do they need more space for a baby on the way? Do they have to move because of a changing employment situation?

If the answer to any of these questions is yes, it means that you may have more leverage during negotiations. Sellers that are facing big life changes are more likely to want the process of selling a home to go quickly.

What Type of Foundation Does the House Sit On?

Knowing what type of foundation your new home was built on is critical in forecasting heating/air-conditioning expense and identifying potential future repairs.

Slab foundations are cheap to install and offer protection against termites and mold, but in hot areas they offer no room for airflow to help keep the house cool.

Crawl space foundations offer better protection against cold but are costlier than a slab foundation. If the crawl space holds moisture, mold can be an issue.

Basement foundations have the added value of providing additional square footage but are notorious for flooding in high-water areas.

When Was the Roof Installed?

Depending on the type of roofing, the lifespan of a roof varies between 15 and 50 years. Older roofs approaching the end of their lifecycle may need general repair or even replacement.

Newer roofs will be a selling point for the home, so if it has been recently replaced they will most likely have that fact in their literature.

Have There Been Any Major Repairs?

Knowing what kind of repairs have been performed already can clue you in as to what issues you may have to deal with later.

If structural supports were replaced due to termite damage, you can expect to have issues with termites in the area. If there was a black mold issue, you will have to be on the lookout for mold going forward

Any knowledge of these major repairs potentially gives you more negotiating room.

How Much Did They Pay for the House?

Knowing how much a seller paid for their house can be invaluable in determining how much they are willing to negotiate. If the home was purchased at a much lower price than the current listing the seller may be more inclined to drop their price as it only cut in to their profits.

If, however, the seller is just looking to not take a loss on the home they may be firm in their pricing.

Seller’s may not be forthright in declaring this information but if that is the case the selling price of a home is often publicly available from real estate listing sites.

Final Thoughts

These five questions are just a starting point for what you need to know when buying your first home. Trust your realtor and don’t let any questions go unasked so that you can feel confident in your purchase.

Danny Margagliano is a real estate agent in the Destin, Florida area. If you are in the market for a Destin beachfront condo reach Danny at 850-830-4747.

The People's House and Senate

by Celia Hayes

So – after a two-hour long stint in the Texas Author's Association booth at the Texas Book Festival this last weekend, my daughter and I decided that we should explore the grounds of the state capitol building, which reared up at the top of the hill just outside the tent where the booth was. No kidding – the tent was at the intersection of North Congress and 11th, just in front of the gate to the grounds ... which looked cool, green and inviting, after two hours in the hubble-bubble of commerce.

We put the two tubs of books in the car, and walked back from the public parking structure on San Jacinto, past the state archives and the statue-topped obelisk monument to Hood's brigade ... that unit which was slaughtered almost wholesale at Gettysburg. In my Adelsverein Trilogy, one of the characters, Peter Vining, is a survivor of that, the only one of four brothers. Most Texans who joined up to serve the Confederate military actually never went east of the Mississippi, but Hood's brigade and Terry's Rangers did, and paid a very high price in blood for the privilege.

I had always assumed that the capitol building was white, of that pale limestone that weathers to ivory – and every time I had seen it from a distance, it certainly looked white or ivory, but it seems that the whole thing is faced with salmon-pink granite. At a distance it looks beige. It is the fourth capitol building to stand on this particular site.

The capitol of independent Texas was a peripatetic matter for some years, being lodged in Washington on the Brazos, Columbia and Houston, among others. This one had the good fortune to be built in the last quarter of the 19th century – which to my mind was one of the best-ever for constructing grand public buildings which imposed and impressed with the importance of the work done in them, yet delighted the eye with detailed adornment ... and yet have managed (with sensitively-done updates, including a huge below-ground-level element at the back so as not to interfere with the view) to be functional and perhaps even uplifting to work in.

Certainly better than some featureless slab of concrete, I-beams and glass, fitted out on the inside in endless offices and cubicles painted institutional beige or pale green. The Capitol building in Austin has class, panache, and a sense of history about it, what with the huge painting of Sam Houston accepting Santa Anna's surrender on the field of San Jacinto, with everyone who was there at the time (and apparently a few who were not) in the audience. The names of the great battles of the war for independence, the war with Mexico and the Civil Ware are inlaid into the floor in granite terrazzo – and the floor under the great soaring dome features the inlaid seals of every country which laid claims to Texas. Away up under the very roof of the dome is a tiny spiral staircase, almost hidden against the wall; I suppose it goes to the very top of the dome, but as interesting as it looked – I would not like to venture up to it. It's not heights that I dislike, particularly – just the prospect of possibly falling from them.

The terrazzo on all the floors of the old Capital was done at the time of the Texas Centennial in and about the mid-1930s. For a couple of the motifs, especially one on a particular second-floor stair mezzanine, we really did wonder exactly how innocent a time that was ... and how many people had noticed immediately what we did about one of them. We did ask one of the DPS agents about it, as we left the building. She said that it wasn't anything of the sort – just an artistic design. But we do have certain doubts.

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Do you have a home or condo to sell and would like to keep more of your own money?

We are here to help you do that... Homes we market with a sales price between $200,000 - $649,999 are charge a Flat Fee of only $4,500*. Homes listed from $650,000 to 849,999 are charge a flat fee of 12,000* and homes $850,000 and up are charged a flat fee of $20,000*.

The only discount is in the commission we charge and not in our service, you will receive full representation throughout the transaction. You get the same extreme service without the big commission.

Traditional Listing Fees and How It Works

Although everything in real estate is negotiable we will use 6% in this example. A traditional listing fee works as so... An Agent/Realtor charges a homeowner a 6% commission, the agent could then sell the listing to his/her own clients and receive the full commission.

Most often an Agent looks towards the thousands of San Antonio Realtors to help sell the property quickly, this is done by entering the home in the Multiple Listing Service (MLS) system. Once listed in the MLS system a commission is then offered to a cooperating Agent (Buyers Agent), most often the commission is split 3% - 3% ( although everything is negotiable).

Now that we have an idea of how the fees are paid and or split, lets see how we differ with a Flat Fee MLS Listing ... It's SIMPLE, when we list a home for sale for example $600,000 our flat fee is $4500, we then offer a Buyers Agent a full 3% commission totaling $18,000 plus our flat fee $4,500 = $22,500 to sell your home...Saving you $13,500.

What will I receive at this discounted fee?

• In-Home Consultation
• CMA - Comparative Market Analysis Report
• Seller Net Sheet
• MLS - Multiple Listing Service
• Internet Marketing ( Home will appear in REALTOR.com, SABOR.com, Homes.com, Trulia.com Zillow.com and much more )
• Professional Photography of Your Home
• Electronic Supra Lock Box
• For Sale Sign Placed on Property
• Display Box
• Flyer
• Social Media
• Appointment Scheduling ( Centralize Showing Service )
• Showing Agents Feedback
• Forms and Contracts
• Contract Negotiations
• Handling of All Paperwork
• Full Representation
• Cancel at Any Time

* These Rates Do Not Include The Buyer's Agent Commission * This is an exclusive offer from Peter Jude DiBenedetto Broker/Owner of Realty United and does not apply to the company as a whole or any of its Realtors/Agents. Open houses, accompanied showings and advertising is available at an additional cost.

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The ABC television show What Would You Do? Has come to Military Town U.S.A in San Antonio Texas. Please watch this moving video and see why San Antonio and it's community is a great place to live and retire for our military veterans.

Tales of Gumbo

by Celia Hayes

I may be defeated in my ambitions this year to have bounteous crops of tomatoes and zucchini squash ... but by way of comfort, the peppers of various sorts and the okra plants are multiplying and producing like champs. The encouraging thing about the okra plants is that I have been able to grow a fair number of plants from seeds left in the pods that I let go last year ... and that the darned things do grow like weeks. However, the okra pods of the variety that I have propagated do have to be harvested before they get to be about three inches long; otherwise they are tough and woody to the point of inedibility. (But still good for gleaning seeds for the next crop.) I would actually consider planting a good-sized patch of okra in the front garden, for the flowers are actually rather attractive; they look a bit like a variety of hibiscus which has pale yellow flowers with a red spot in the center. Alas, in the eyes of non-gardeners and farmers, the leaves of okra bear an unfortunate resemblance to marijuana plants, and while I would like to hope that the average neighborhood SAPD officer has enough savvy to tell the difference at a glance ... I don't want to borrow trouble.

So – okra in quantity; what to do with it? Aside from pickles, and breading and deep-frying it, my usual method for okra is to slice up the pods as I harvest them, and put them in a plastic bag in the freezer until I have enough to make a good batch of gumbo out of it. Gumbo is one of those all-purpose dishes like meatloaf or macaroni and cheese; infinite number of recipes in infinite variations, depending on what you have on hand. It all begins with a roux, of course – oil and flour stirred together, until the flour darkens to the color of a tarnished copper coin. This is what gives the gumbo broth it's thickening substance.

This is a recipe that I like to use, raided from the internet, but with additions from one of my Cajun cookbooks and adjusted to incorporate the accumulated okra harvest.
Combine together ½ cup peanut oil and the same of flour, and simmer until darkened – but not burnt! Add in 1 chopped onion, 1 chopped green or red pepper, and 3 stalks of celery – all very finely chopped, and stir together with the roux until the vegetables are limp. Add in 3-4 minced cloves of garlic, and 1 Tbsp of Creole seasoning, like Tony Chachere's. In another pot, heat almost to boiling, 5 cups of fish, chicken, or vegetable stock, and blend it gently into the roux-vegetable mixture, stirring constantly. Add 2 teaspoons of Worcestershire sauce and 1 to 1 ½ cups fresh or frozen okra, sliced into rounds. Cover and simmer for half an hour, and add half to 3/4ths of a pound smoked Andouille sausage, sliced into ¼ inch rounds and 1-2 lbs fresh shrimp, peeled and deveined. If the shrimp is already cooked, then just simmer the gumbo long enough to warm the sausage and shrimp through. Serve with a scoop of hot rice in the middle, and a sprinkling of sliced green onion.

Another Kind of Farmer's Market

by Celia Hayes

As much as I try to wedge in useful vegetable crops into various parts of my tiny suburban back yard, there is just not enough cultivatable space to grow enough that our needs for seasonal vegetables can be satisfied from it, day in, day out, year in and year out. Oh, certainly, we have gotten good things from the garden – especially potatoes this year. Sing ye the glories of home-grown potatoes, so tender, so luxuriously velvety that we didn't know whether to eat them, or slather them onto our hands like skin cream. I got one good squash, a fair number of okra pots, and all the fresh herbs I could use – 'Twas ever thus; herbs in plenty – other edibles, not so much.

There isn't the custom in this country of garden allotments, as there are in England, Europe and Russia; small plots for personal cultivation on the outskirts of towns and cities, intended for the use of apartment and townhouse dwellers. I have often read that for most of the last half of the 20th century, ordinary Russians city-dwellers were almost entirely fed from what they could grow in their relatively tiny allotments. And it's not like I have the time and energy for any more gardening than I do already.

But I still want fresh and seasonable garden produce, and enough of it that I can process that portion which cannot be consumed fresh; home-canning, freezing or drying it for later use. After a couple of years of diligent efforts in that direction, I am concluding that my own yard is not the complete and wholly satisfying fulfillment of that ambition. It's not big enough, I am not that much of a genius at microscopic-acreage farming, and I simply do not have the time, anyway. So – searching around for a means to that end, I did a brief exploration of local farmer's markets. Alas, I was accustomed to the street farmer's markets in Greece, where the street in particular neighborhoods was blocked off on one day a week, and all the local truck farmers would show up with a load of fresh produce ... fresher than fresh, and cheap as the dirt which was still usually on root crops like potatoes. Also – they were cheaper and better quality than in the local supermarket; a retail location which just barely counted by American standards as a supermarket anyway.

Our local farmer's markets do provide the high-quality produce – and meat – and eggs – and all sorts of other lovely edibles, but with certain exceptions, the prices are not a bargain. Which I regret, because I would dearly love to support small local enterprises ... but not at those prices. So, I will explore the options available with local farmers though something called 'community supported agriculture'. Basically, you pay a regular fee ... and get a weekly share – usually in the form of a basket of whatever produce has been harvested from the farm that you have bought a teeny share in. As the saying goes – you pay your money, and you take your chances. What you get in your weekly basket from your chosen farm is yours to do with as you choose. In last week's community market in Bulverde, we had a booth next to one of those little local truck farms which offers such an option – and I think that I will give them a call, and see what they can do for me.

Good Stuff

by Celia Hayes

My daughter and I did our foodstuff stocking up this last weekend, including a run out to Granzin's in New Braunfels. Alas, we were disappointed in our intent to purchase a large quantity of beef bones to make home-made beef broth out of, and then to give to the dogs for their chewing pleasure. Their stock of bones in the back room was much reduced by demand, I guess. We should have gone up during the week, as we have on previous occasions. No good meaty beef bones this trip! But I still have a sufficient quantity of the last batch for my various cooking purposes, so ... never mind. It's all quite simple, actually; spread out the fresh bones in a single layer in a pan – or several, if necessary – with a quartered onion or two and roast in a 350° oven until the remaining meat and fat and the bones themselves are nicely brown. This should take a couple of hours – then put the bones and onions into a stock pot or Dutch oven with a tablespoon or two of whole peppercorns, cover with water – filtered or distilled if you are really hard-core about it, cover and simmer gently overnight. Strain the resulting broth, which should be a lovely dark-brown color and incredibly rich in taste, into one and two-cup capacity containers, discard the onion debris, and save the bones for the dogs. They will appreciate it no end. Ours do, anyway. The containers go into the freezer – labeled, of course – and make the basis for any kind of soup imaginable.

The other simple cooking hack that I have worked out this summer, is the recipe for HEB's BBQ chicken salad. They make it from their own rotisseried chickens, but it is which is absolutely divine when made with the leftovers from a whole rotisserie or BBQ chicken from the Riverside Market in Boerne – one of our favorite sources for rotisserie and BBQ chicken. Take the meat from half a rotisserie or BBQ chicken – or the leftovers from same – off the bones, chop the meat coarsely and mix with two stalks of celery – also chopped, and half of a small onion, or a couple of green onions, likewise chopped.

In another small bowl, mix 3/4th a cup of good mayonnaise – we favor Duke brand – with ½ teaspoon each paprika, garlic powder, and chili powder, 1 teaspoon tabasco sauce and salt and pepper to taste. Combine with the chicken, celery and onion, and let chill for an hour or so. It is divine, served on good sourdough bread, or even on a split Kaiser roll.

The BBQ chicken salad is very good served with roast corn on the cob; and the hack for that is also amazingly simple; just peel back the husks from fresh corn on the cob, remove the silk, and then fold the husks back over the corn. Tie the ends of the husk together with a length of husk or a piece of cooking string, and soak the whole thing in water to cover for half an hour. Then drain, and lay out the whole husks on the BBQ grill, along the side. The outer husks will char and burn a bit, but the corn itself will steam ... and it will be awesome.