11. Does your property manager have a full accounting staff that is licensed andLetts Property Management utilizes a very robust and comprehensive double entry accounting system to track all transactions for our clients. We provide detailed monthly statements for each one of our clients. We provide detailed monthly statements for each one of our properties to help our clients stay informed and assist in tax preparation. All this information, as well as a variety of
13. Does your property management company performLetts Property Management performs a full interior and exterior inspection of each individual unit and property every 6 months. First, we guarantee the tenant is adhering to the terms of their lease with regards to caring for the property, number of residents, and approved pets. Second, maintenance inspects the condition of the property's plumbing, roofing, yard, and any other preventative maintenance.
Every property investors hopes that one day they can take their property investments and reinvest them in another good rental investment. New property investors hope that their initial investment can drive home a huge ROI and some day take that profit to continue their investment. Whether a new investor or seasoned investor, here are the key aspects to consider to identify a good rental investment property in Chicago.
Location: One of key items to identify is the best areas to own an investment rental property. Chicago has a neighborhood for every type of investor. Some areas may have higher rents, higher housing prices, and more stability while others may have some real deals on investment properties, but sometimes coupled with lower rents and more wear and tear on units. Work with a property manager who is knowledgeable about the entire Chicago city and suburbs to help recommend the best location for your investment property. Remember, that location is one of the few things that investors cannot change about a property, so make sure to do some research and make a decision that best fits your investment style.
Rent Ready: While some property investors are willing to do the work to get a property ready to rent, many property investors would rather see income coming in right away. Letts Property Management works with both types of investors as Letts Property Management has a full service construction department that can help get a building ready to rent, but getting a building ready to rent does come at a cost. Typically, buying a property that is already ready to rent or better yet, already rented may be more costly up front, but many property investors appreciate seeing income coming in sooner rather than later.
Make Sure it is Rentable: Some condo, town-homes, or co-op buildings have restrictions on leasing out the property. Be sure to understand the terms and conditions on renting the unit if there are any before buying the property. Buying a property with very restrictive rules on leasing the property could make the property difficult to rent or costly to fill.
Think Like a Renter: If the goal of purchasing the property is to rent it out to tenants, consider all the aspects of the property that a renter would. Location, amenities within the community around the building or of the building itself, building safety, how much space each unit has as some key aspects to consider. Put yourself in there shoes and think about why the property is so desirable for renters. The more desirable the property, the better it is for the investor as it will fill quicker and bring higher levels of monthly rental income.
If you are considering purchasing a first rental property or looking to add to your rental property portfolio, contact Letts Property Management’s experienced property management staff today at 630-324-4267. We can offer a property evaluation along with some information on the best area for your investment style.
One mistake that many new and even experienced property investors make is under evaluating the value of their property managers. While many tasks that a property manager takes off the hands of a property owner are obvious such as collecting rents, handling tenant calls and the tenant-landlord relationship; other responsibilities that a good property manager handle are not so obvious.
Asset management: The best property managers will have your property investment at heart. Your property is an asset and one that you would like to be profitable and successful as an investment. The best Chicago property managers will look at your asset and make recommendations and do what they can to help you make the most of it. A property manager can make recommendations to fit your investment style and maximize your asset for many years to come.
Leasing Advantages: Utilizing a property manager in Chicago can pay big dividends when you need to get a property filled. Property managers build relationships with leasing agents and realtors in the area they manage properties in and their signage can be just what your property needs to get filled fast. On top of those advantages, a property manager will handle all the leasing logistics and provide your property with maximum exposure to make sure that every potential tenant can find your property so that only the best is selected for your unit.
The best Chicago property managers will be able to fully explain the value that they can provide and the benefits that property owners can expect to see. For more information on what to look for in a good property manager in Chicago, check out our recent post entitled The Benefits of Choosing a One Stop Shop Property Management Company or contact us today for more information.
Chicago landlords burdened with high levels of liability have left behind the security deposit and are instead utilizing move in fees.
Security deposits may soon be grouped with dial up Internet and landline phones as an antiquity in rental properties.
The Chicago Association of Realtors withdrew its support of security deposits in January 2014 because the deposits put landlords at such a risk.
In the past there have been issues with landlords misusing security deposits. As time passed tenant protections were put in place to guard against this behavior, one of them being landlords must put the deposits into interest bearing accounts. These accounts rarely earn more than even a dollar in interest because of low rates.
Currently, a landlord must provide a tenant with an itemized list of damages within 30 days of their move-out date before subtracting any expenses. They must also return the security deposit and interest that it has earned minus unpaid rent and expenses within 45 days of the tenant moving out.
If a landlord is late sending a check for a security deposit to a tenant there can be up to thousands of dollars in fines. The fines can include amounts equal to two times the security deposit plus interest plus attorney fees and court costs.
Landlords are subject to an environment filled with risk and litigation if they utilize security deposits. This out of proportion liability has created the decline of the deposits.
While the Rental and Landlord Ordinance in Chicago does not require or prohibit security deposits, landlords that do use them must adhere to the strict guidelines mentioned previously.
Move in fees are now taking the place of security deposits. The fee is a one time and non-refundable, but is usually less than a security deposit. Even though a move in fee is not refundable new tenants perceive their total upfront cost as less and therefore these leased spaces are cheaper to initially access.
As a Property Management company in Chicago, Letts Property Management agrees with the Chicago Association of Realtors on the subject of security deposits. We believe that liability is too heavily placed on landlords, but currently still collect security deposits for our owners.
It’s important to know what kind of experience a company has. Ask how long they have been in business and inquire about the owner’s background. Find out about the experience level of the property manager you’ll be interacting with on a regular basis. You want to find out what they know about the vast world of real estate investment. In the last 13 years, I’ve noticed that I learn something new on a daily basis. We can lean on our experience because we’ve gone through so many situations with tenants, owners and properties. That experience allows us to handle every issue smoothly and easily. The problems we encounter do not cost our owners money. I always tell new owners that their property manager shouldn’t be learning the business at their expense. We see that quite often.
I always encourage people to take a look at the size of a property management company. There are a number of individuals who consider themselves property managers, but they don’t have a staff to support them. Find out how many employees will be working with you and how many of those individuals will be actively involved in the management of your property. Is one person going to handle everything that’s going on for 500 different properties, or are there a few employees who have manageable portfolios? The goal is to work with a company that can manage its workload, making sure your property is performing well.
A lot of real estate companies have entered property management because of where our real estate market is. However, you want to really get a sense of focus when you’re considering a property management company. You don’t want to work with Realtors who care more about buying and selling than they do about managing your property. It’s important to have professional property managers who are focused on getting your property to operate at its highest potential return. We see a lot of real estate agents who want the best of both worlds, and they think they can buy and sell as well as manage homes. Individuals working with companies focused solely and specifically on property management seem to have the most success with their properties. They have the highest probability of return on their How to Choose a Chicago Property Management Companyinvestment.
These three main areas are critical when you’re choosing a property management company. If you have any questions or you’d like to talk more about it, please contact us at Letts Property Management.
The first step is to get an idea of how much units similar to yours are leasing for in your area. If you’re an individual landlord without the resources of a property management company, this can be a bit of a challenge. Try to find this information online. You can go to Craigslist and search for comparison or you can call rental ads you find in the newspaper. Find those comps. If you have a three bedroom, one bath apartment or house, you need to know what other three bedroom, one bath properties are renting for in your neighborhood. Make sure you’re comparing properties that are similar. It’s important to compare apples to apples, not apples to oranges.
Condition and size
If you have a small two bedroom, one bath apartment, you cannot price it based on the rental rates of a large two bedroom, one bath house. When you’re gathering comps, you also have to think about condition. Properties that are outdated will rent for less than properties that are new with recent upgrades. Those things will play into the way you evaluate the price of your unit. If you have a good sized unit and you have nice finishes and updates, and you know your comps, you can push the price up. If your property is on the smaller side or you have concerns about its condition, look at your comps and price it on the lower end of your range.
Location is absolutely the key to all of real estate. As you’re looking at your comps and trying to settle on a price, you have to consider the property’s location. Look at what’s nearby; is it located in an area with good schools, parks and shopping? Or, is it outside of town in an area that’s not great and a little run down? These things must be taken into account.
Look at all three of these components, otherwise, you’ll overprice your property or underprice it. That overpriced property will sit on the market How to Set the Best Price for Your Chicago Rental Homelonger and lose potential rent. An underpriced property will rent quickly but you’ll lose $100 or $200 a month.
Once you have the right price, the home will lease without a problem if you’ve got a good product that’s in good condition. If you’re not sure how to incorporate these things into your pricing, you can contact us at Letts Property Management, and we’d be happy to tell you more.
The Benefit of Time
Through the years, we have found that a company using a lot of outside resources increases the amount of time an owner has to be actively engaged. When you hand your rental over to a property manager, you don’t want to spend a lot time working with outside companies. There are a lot of different companies involved with your property, and you have to pay attention at all times. With a one stop shop, the owner can hand it over and we’ll take care of everything. Owners can still be fully engaged with what’s going on at their properties, and you’ll always be kept informed, but you don’t have to personally pass the ball to a number of different people. It’s all happening in the same place.
If you’re on vacation, there is no need to worry about talking to maintenance people or following up with contractors. Your property management company will handle it all on your behalf. So when you’re selecting a management company, you have to think about how much time you have to spend and invest in overseeing and handling those properties. Most of our clients are busy professionals with a lot going on. That’s why we want to keep all aspects of property management under one roof.
The Benefit of Knowledge
A property management company that handles everything also allows for more efficiency. There’s more knowledge about your property in one place because a whole group of specialists within the property management company are working on it. You’ll have maintenance professionals, The Benefits of Choosing a One Stop Shop Chicago Property Management Companyleasing professionals, management professionals, construction specialists and accounting experts all working on your property and consulting with one another. This results in a property that is run efficiently and earning the highest possible return.
While there are a lot of questions you may want to ask before hiring a Chicago property management company, here are three questions that need to be on your list.
How do you get your properties leased?
The best property management companies in Chicago will always help handle the leasing on your property. The property manager may leave the ultimate decision up to you or have you involved in the process in some way, but the best property managers will be able to attract potential tenants, screen them, and ultimately only pick the best tenants for your property. This should include putting the property online, working with internal and external leasing agents, and for larger buildings utilizing signage. Some companies focus on only one leasing avenue, but the best property management companies will utilize as many as possible to get your unit filled in the fastest time period possible.
How do you handle maintenance issues?
When interviewing potential property management companies, make sure to ask about maintenance needs on the property. Residential properties always need maintenance in time and the best property managers are prepared for these issues. The best companies will have a full maintenance staff in-house and utilize specialized partnerships to ensure the most cost effective and timely handling of maintenance issues.
How can I monitor my properties finances?
Every Chicago property investor should be able to keep an eye of their properties finances whenever they desire. The best property management companies in Chicago will utilize an online system that gives property managers everything they need to monitor their unit’s profitability. Look for a company that offers 24/7 access to the accounting system so that you can monitor your properties performance when it is most convenient for you.
While these are not all the questions to ask a potential property manager, these are three good questions to be sure to ask before hiring any Chicago property manager. The best property management companies in Chicago will quickly become apparent through these three questions and the differences from property manager to property manager will become more apparent. For more information on what you should look for in a Chicago property manager, visit our page about the 15 things you should know about your property management company. For more information about Letts Property Management and all of our property management services, contact us today at 630-324-4267.
Hiring a property management company in Chicago to manage and maintain your investment properties is a surefire way to maximize your properties value. Well property management companies can offer a wide variety of services and offerings; here are the best ways to utilize a Chicago property management company in Chicago.
Leasing: Leasing is one of the toughest parts of investment property ownership. From handling all the maintenance to get the unit ready to advertising the unit and screening tenants, getting a unit filled is no easy task. On top of everything else going on to get the unit ready and shown to prospective tenants, no rent is coming in on the property. That is why a good property management company in Chicago will handle the leasing of your investment property. The best property management companies in can handle every aspect of the leasing process and help you select the best tenant for your unit. Property management companies can shorten the on-market time for your units and get rent coming in sooner rather than later. The price that most property management companies charge to get a unit filled is more than worth it.
Maintenance: One of the biggest day-to-day expenses of owning investment properties is the maintenance on the property. The best Chicago property management companies have a full maintenance staff in-house and can handle all of the maintenance needs on a property. This not only ensures quicker and more affordable maintenance services, but also allows maintenance techs to visually inspect the property while handling maintenance needs to watch for any damage or other issues on the property. This ultimately protects your property and keeps eyes on your unit so you don’t have to.
Tenants: Hiring a property manager puts a buffer between tenants and owners. This keeps tenant calls off of your plate and on to the plate of the property management company. Regardless of the issue, someone has to deal with whatever issue the tenant has and this can sometimes be overwhelming for an investment property owner. A good property management company can handle most tenant issues and only involve owners with those issues that need owner input.
To maximize your properties worth and to make your investment property ownership more stress-free, contact us today. Our experience property management staff can show you all the benefits of working with a professional property management company and how we can help make the most of your investment property.
A vacant unit can quickly turn a solid investment in to a major pain. While most property investors understand that having a unit sit vacant will not bring in any income, many do not think about all the costs involved with a vacant unit. Despite no income coming in, taxes and mortgage payments are still due and the unit is at a higher risk of damage. A good property management company will seek to minimize the amount of time a property sits vacant and minimize the cost of having a unit sitting vacant.
Taxes/Mortgage: As an old saying goes, there are few guarantees in life; but taxes are guaranteed. A vacant property or unit’s taxes are still the responsibility of the property owner and mortgage payments still need to be made and made on time. It is important to take these costs in to account when considering a rent increase on a current tenant and when setting a monthly rent price. Scaring away a current tenant with a dramatic rent increase or setting a monthly rent price too high for the area can be detrimental to a properties return-on-investment (ROI).
Damages: A vacant unit is always at risk of break in and damage. There are certain very high-risk areas in Chicago and a good property manager will suggest the right plan to protect the property while vacant. This is something that property investors should take in to account before investing in a property and something to be aware of during the leasing process. Damage to a unit can be detrimental to a properties value and cause the unit to need repairs while the unit is sitting vacant.
Prevention: A good property management company in Chicago will be aware of the true cost of having a unit sit vacant and will work to get the unit filled fast. The best property management company will offer a higher compensation for getting a unit filled and have connections with leasing agents in the area. Depending on the area in Chicago, an experienced property management company can suggest steps to minimize damages and threat to a unit. Getting a unit filled is one of the most strategic parts of investment property ownership and utilizing an experienced property management company can ensure your property gets filled and gets filled with the best candidate in the quickest possible time.
If your current property manager does not seem to truly understand the full cost of a unit sitting vacant or you are having trouble getting your units filled in a timely manner, contact us today. Our experienced property management staff will work to maximize your unit’s profitability and minimize your properties expenses.
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