"Don’t leave your water safety to chance; protect your pipes, and plan for the potentially harmful e...
Florin Iftode
Great article and great ideas Gino.
I really love the idea with the pizza contract. Definitely it i...

Training Trivia

If a prospective resident wants a lease with an ending date not available on the lease expiration matrix, it is smart to make an exception and allow their lease to end when they desire to secure the lease.

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Posted by on in Apartment Leasing
Winter is Coming - 6 Areas for Multifamily Operators to Review With HBO about to premier my favorite currently running series,Game of Thrones, I couldn’t help but see many signs of that show's catchphrase in recent pronouncements from various media, that absorption rates are now below new delivery rates, thus likely driving moderation in occupancy and rent growth in many markets. Winter is indeed coming. Unlike the never-ending contest between the Lannisters and the Starks, we in multifamily can step away from the battle and prepare to face the Windwalkers of the next recession. Here’s my checklist for just a few areas in demand management to review for any sophisticated multifamily operator:  1. Pricing and revenue management If you haven’t adopted formal pricing and revenue management software, then you should. The vast majority of the NMHC top 50 have adopted it, and there’s good reason for it. I’ve never seen a properly constructed test (i.e. pre-selected test properties versus pre-selected control properties) fail, and I’ve personally witnessed more than a dozen involving well over 120 communities in total. And if you are using a system, have you critically analyzed your system and your execution? For example: How many recommendations are being over-ridden? More than 10% is a strong indication something is wrong with your software, its setup or your team’s use of it. How many leases are “non-compliant?” Same rule…more than 10% is a red flag. How volatile are the price recommendations? Changes more than 1-2% happening more than 5% of the time are simply too many. Our business moves slowly, and it’s...

Posted by on in Property Management
You’re probably wondering how any of that equates to attention to detail. Trust me, it all does. About two or more months ago, I took on a new outlook to my health. I decided to start eating better and drinking more water. A few weeks after that, I decided to take on a fitness regimen. Soon thereafter, with all the other changes I had going on, I figured I would start doing some soul searching and start my spiritual journey again. You’re thinking, “Wow Britt, way to try to conquer any and all goals within a 90 day period! Overachiever.” (And probably with an aggressive eye roll in there too). Funny thing is, it wasn’t about overachieving. It wasn’t even about goals. Initially it was health, because kidney stones suck. Then it became about wanting to feel better. And working out really does illicit some sort of power within. Like you can do damn near anything. Ok, well, it does for me, because any time I can overcome the lazy factor and get my butt to the gym to workout, well I’ve literally achieved a LOT! While I had that feeling of power from bettering myself internally and externally in the sense of my health, I then decided to take it a step further and explore my lack of faith. (If you follow me on Facebook you know all about that recent exploration). I decided to explore God, my spirituality, my faith and really go a step further with my overall well...

Posted by on in Student Housing
It can be frustrating for potential rents when they come across the perfect apartment, only to later find out later about the “no pet policy”, and in turn, your apartment complex could be losing a valuable lease and angering potential renters. I’ve experienced this first hand myself. I work for a niche student housing developer specializing in apartments in Gainesville . Only 2 of our 23 apartment complexes allow pets. Last week, two students came into our office and toured a model apartment for Savion Park, one of our newest and most upscale apartments near UF sorority row. They loved the apartment and decided to lease it the next day. Just before lunch, an angry leasing agent from the Savion Park office called me on the phone to say that the renter had searched for pet friendly apartments in Gainesville and seen an ad for our property. Since she was specifically searching for pet friendly apartments and our apartment complex came up in the search, she never asked whether or not our community was pet friendly. During the lease signing, when the leasing agent asked her to initial next to our no-pet rules, the renter became very angry and said that she had been tricked. Needless to say, they stormed out without leasing, and later they put in a negative apartment review of our company online, saying that we had been deceptive. Our apartment complex website very clearly states that we are not pet friendly, but the prospective renter had assumed...

Posted by on in Apartment Investment
The number one goal when investing in multifamily real estate and to explode your wealth is to increase the Net Operating Income (NOI).  Let me quickly define NOI as the total gross revenue subtracted by the operating expenses of a property.  When an investor analyzes an asset, he will typically use NOI and cap rates to determine value.  A cap rate is simply the rate of return on an asset based on income.  The higher the NOI, the higher the value of the asset   How do you calculate value with cap rates?  Let me show you a quick calculation.  Let’s assume the NOI of a property is $100,000 and the prevailing market cap rate is 10.  You would take the NOI and divide the cap rate to obtain the market value. Thus $100,000/.10 = $1,000,000 value.  Market value and cap rates have an inverse relationship.  As cap rates lower, values rise and vice versa.If the NOI on the same property increased to $120,000, the value of the asset at a 10 cap would increase to $1,200,000.  As you can see, a $20,000 increase in the NOI boosts the value of the property by $200,000.  Your focus is to expand the NOI by either expanding the revenue or decreasing the expenses of the property. Let us show you our three-step framework on achieving this goal.  (Your broker should be able to tell you cap rates in their market)Step #1: Fill the Vacant UnitsOnce you take over the property, your number one priority is...

Posted by on in Multifamily Industry News and Trends
April is Financial Inclusion Month. It’s also Fair Housing Month. These two occasions cross paths when we consider that 138 million Americans are struggling with their financial health, and only 6 out of 10 (59 percent) households would have enough liquid savings to pay an unexpected $2,000 expense, according to reports by the Center Financial Services Innovation (CFSI) that also highlight in the event of immediate need that credit is not a viable option for more than 108 million Americans who lack traditional credit cards and even modern online lending. Fair Isaac, the company that in 1956 created the FICO credit scoring software that’s still in use today as a measure of consumer credit risk, is a tie that binds Fair Housing and the oh so difficult goal of financial inclusion when we look to the cash challenges consumers face when their credit score is less than perfect, and below the minimum requirement to secure a lease for rental housing. A quick synopsis: The Fair Housing Act was originally passed in the late 1960s through the urging of the U.S. Department of Housing and Urban Development (HUD) following passage of the Civil Rights Act in 1968. Its primary purpose was to eliminate discrimination between buyer and seller, landlord and tenant, making it unlawful to refuse to sell or rent to an individual base on race. The law has been amended in years since with additional limitations on discrimination based, most notably, on personal handicaps with the passage of the Americans with...

Posted by on in Apartment Leasing
  Getting Millennials To Settle In Your Community If there’s one generation breaking the mold, it’s Millennials. Born between the years of 1980 thru 2000, they constantly attract the attention of the media through their job-hopping habits, their diversity and their high levels of education. Being the most studied generation in history, Millennials have a different outlook on life than previous generations and are gearing up to change the spending habits of our current economy. This all might sound a bit intimidating at first but it’s great news for the multifamily industry. Millennials are drawn to renting for a variety of reasons and they cherish the ability to pick up and move whenever they like. Because of this, renting has never been more attractive. So how can apartment developers capitalize on these tech-savvy nomads? Here are the top three things Millennials look for in their future communities. Technology – This should be obvious but not all communities understand it. It’s not about Internet access and gaming areas; it’s also about the little things. Great examples making all the difference are USB chargers built into wall outlets, keyless electronic access throughout the property and even a simple digital rent payment system. These all display your community’s commitment to keeping up with the times. Hey, it doesn’t hurt to have tech-savvy amenities, such as a package acceptance solutions. They order a lot of packages and they want to receive them on their schedule! Attractive Apartment Layouts – For Millennials, less is more. They’re willing to downsize the bedroom for a...

Posted by on in Construction and Development
Largely due to the subprime mortgage crisis in 2008, the typical American renter is no longer a college student or young professional. For the first time in America’s history, the average renter is now 40 years old.   The flood of working-class, middle-aged renters has led to historically low vacancy rates and rental costs that significantly outpace the rate of inflation. While new properties are being built, they’re largely marketed to high-income renters, often perceived by housing developers as low-risk, high-reward tenants.   Unfortunately, the scarcity of affordable housing has forced economically conscious tenants to compete against one another for fewer and fewer affordable properties, leading to substantially greater rent inflation at the low end of the spectrum.   How Developers Can Help Communities Thrive   Affordable housing is in high demand, and with the low income housing tax credit (LIHTC), developers and property managers can help address that need. Available pro rata over a 10-year period, the federal LIHTC program subsidizes up to 70 percent of the low-income unit costs in a project via a 9 percent or 4 percent tax credit.   And, contrary to popular belief, working-class housing can be quite low-risk. LIHTC properties have a vacancy rate of just 4.2 percent, compared to the overall rental market’s 10.6 percent. Since the program’s inception in 1986, foreclosures have occurred in less than 1 percent of LIHTC properties, beating all other classes of real estate.   It takes more than bricks and mortar, however, to create a housing community that will meet the needs of working-class individuals. Property developers wishing to build desirable, affordable...

Posted by on in Apartment Investment
The number one goal when investing in multifamily real estate and to explode your wealth is to increase the Net Operating Income (NOI).  Let me quickly define NOI as the total gross revenue subtracted by the operating expenses of a property.  When an investor analyzes an asset, he will typically use NOI and cap rates to determine value.  A cap rate is simply the rate of return on an asset based on income.  The higher the NOI, the higher the value of the asset How do you calculate value with cap rates?  Let me show you a quick calculation.  Let’s assume the NOI of a property is $100,000 and the prevailing market cap rate is 10.  You would take the NOI and divide the cap rate to obtain the market value.  Thus $100,000/.10 = $1,000,000 value.  Market value and cap rates have an inverse relationship.  As cap rates lower, values rise and vice versa. If the NOI on the same property increased to $120,000, the value of the asset at a 10 cap would increase to $1,200,000.  As you can see, a $20,000 increase in the NOI boosts the value of the property by $200,000.  Your focus is to expand the NOI by either expanding the revenue or decreasing the expenses of the property.  Let us show you our three-step framework on achieving this goal.  (Your broker should be able to tell you cap rates in their market)   Step #1: Fill the Vacant Units               Once you take...

Posted by on in Apartment Leasing
In the Property Management industry your community's reputation is everything. It is your bottom line. It is far more challenging to increase your occupancy rate when you have to contend with bad ratings or reviews. It plays a large role in whether or not you will make occupancy quotas and generate new residents, as well as maintain your good residents. Occupancy is going to be the driving force for your apartment community in order to make a profit. As a leasing agent, you must overcome bad press and protect the reputation of the owner's property. This ensures high profits and your job security. If you are fearful that your reputation as a leasing agent is falling short, or your apartment community is being devalued, you need to follow the suggestions below to overcome the negativity.   How can I overcome a bad reputation? The first step to overcoming a bad reputation is to act positively. As a leasing agent, you need to create a plan. If you have current residents that love their apartment homes, ask them to write a helpful review. You would be surprised at how many people will jump at this idea. Reviews can be 50 words or less as long as they portray the community in a positive light. Next, you need to respond to bad press. Get online and be social on your social media pages. If someone said there is a maintenance issue, or an issue that you can directly resolve, get it done. Draft...

Posted by on in Multifamily Industry News and Trends
What is UPCS-V?To help improve tenant safety and HUDs’ oversight of the Housing Choice Voucher (HCV) program, REAC will introduce a new inspection protocol called UPCS-V; with the “V” signifying “Voucher”. UPCS-V introduces new measures to enhance the consistency and objectivity of the inspection process, and will provide more information about the condition of individual housing units. Congress expressed the need to update the housing quality standards in order to reflect current advances in home inspections and changes to standards of health and safety threats in homes today. Through this initiative, HUD aims to clarify and streamline inspection processes for PHAs and inspectors, while increasing owners' and tenants’ access to detailed information about their homes.What are some of the changes HUD is considering with the new inspection standard? One is the integration of IT system. One of the advantages of creating a new inspection standard is the ability to integrate new technology into a prototype system such as UPCS-V. HUD envisions inspectors to conduct inspections on a handheld device in order to capture deficiencies. It would also support the use of photographic evidence and enable real-time recording of inspection findings. HUD would provide a data exchange framework for inspection data (.XML file) that can be integrated to existing systems....