Pasadena, CA – March 25, 2014

We hope to see everyone back in Pasadena in 2015!

www.IncomePropertyExpo.com

Seduced by the promise of extra income — a $100 or so a night in many cases — tenants across the country are looking to vacation rental service Airbnb to turn their apartments into profit centers through temporary sublets.

The most active markets are in major cities, including those with rent limits. In some cases, rent-controlled tenants are making more money than the landlord is legally allowed to charge.

Some call it ingenuity. But others, including property owners and managers, say it’s illegal.

As the practice grows in popularity, landlords are fighting back. For instance, in a recent report from San Francisco, a tenant who was earning $185 a night by taking in temporary boarders just got the boot. An eviction attorney says he’s filed about a dozen of these cases in the last few months, according to the report.

In New York, a landlord was slapped with fines when a tenant’s sublet violated the ban on short-term lodging.  The landlord deferred the eviction when the tenant agreed to pay the penalties and to stop renting out the spare bedroom.

Airbnb offers a turnkey service allowing visitors to search online listings for extra rooms or even empty couches in large cities around the world. Sublets in San Francisco alone are estimated in the thousands, according to the report.

Despite negative publicity,  the problem doesn’t seem to be going away.

If a lease agreement prohibits sublets, or short-term rentals violate local law, a landlord may have grounds to file an eviction. However, in some cases there is no built-in remedy for landlords against tenants who are exploiting a lease for profit.

And, some tenants won’t leave quietly. One tenant attorney told reporters that landlords are using the Airbnb situation as a “false pretense” to get rid of rent-controlled tenants. He negotiates lease buy-outs on behalf of tenants in cases where an eviction may be costly and protracted.

Airbnb says its policies discourage anyone from breaking the lease, or the law.

American Apartment Owners Association | Company Website |  Rental property management can be very demanding. Our job is to make this day-to-day property management process smoother. AAOA provides a host of services ranging from tenant screening to landlord rental application forms and contractor directory to apartment financing.

Just reaching your prospective renters through targeted marketing isn’t enough anymore. Without a full toolbox of digital tools you might be missing out on golden opportunities to close more sales. If you are straddling the fence between a paper leasing processes and a digital automated leasing system, here are a few details to help you get off the fence.

The Problem with Paper Trails

The paper application process isn’t efficient, it’s fragmented. Tenants look for a property online (or during a drive-by), pick up an application, mail it back, fax it in or hand deliver it to the leasing office, and wait for a leasing agent to manually key in the information. Depending on how motivated the prospect is, he may or may not view other properties while waiting for notice of approval.

At every point in the process, property managers risk losing the prospect’s interest. He or she might take the application, but get distracted by other properties before filling out the application.  He could fill out the application, but fail to return it. Maybe, another property using digital processing reaches a decision faster and closes the deal while your team is evaluating the paper application.

Digital (Mobile) Lease Flow

Mobile lease flow systems close those gaps. When an apartment seeker locates a property that piques his interest, he can complete an application from any mobile device, get an answer from management, and sign the lease – all digitally and without leaving your property. No loss of momentum and no interference from other properties vying for attention. This also means prospective tenants doing a drive-by don’t have to wait for open office hours to apply.

Supporting a Green Lifestyle

Digital lease flow systems support an eco-friendly lifestyle. Managing guest cards, non-paper applications and online virtual tour brochures drastically reduce paper waste and shrinks your property’s carbon footprint. An environmentally responsible, low-impact management style is very appealing to many urban apartment dwellers who look for sustainability-centered properties to call home.

Boosting Profits

Digital applications are efficient and cost-effective. Property owners and managers find that digital leasing systems reduce staff hours, while increasing closing ratios. Cost of printing and file maintenance also falls. Integrative, seamless paperless leasing options require fewer staff hours, but allow for more customer contact. It is like having a virtual leasing agent on call to keep your prospects engaged throughout the process from the point of interest to a signed lease.

Still Not Ready to Switch?

Beside appealing to today’s savvy, digital consumers, saving money on supplies and labor costs, and reducing your carbon footprint, there are a few more advantages for digitally integrated systems.

• Speed up background check processing times.
• Electronic payments reduce NSF chargebacks and late payments.
• Paperless applications reduce turn-around time.
• Electronic files are secure and archived for future retrieval without taking up file space in the office.

Changing the way you do business can be stressful. Switching to a system that saves you money and boosts efficiency relieves stress though, and is a great option for tenants and property managers.

Appfolio | Company Website | LinkedIn Connect | AppFolio, Inc. develops Property Management Software that helps businesses improve their workflow so they save time and make more money.  Appfolio submits articles & blogs including topics of Resident Retention, Improved Owner Communication, Time Management, and more.

Does your neighborhood get good grades?

With a new rating site Neighborhood Appeal, apartment seekers now can see how the neighborhood rates, based on a scale of A+ to F, for any city, town or zip code in America.

To determine the grade, Neighborhood Appeal analyzes:
Scenic beauty
Weather
Crime
Air Pollution

More important, Neighborhood Appeal allows visitors to submit their own grade for any neighborhood.

We believe this user-submitted “crowd sourced” Neighborhood Appeal grade will become the most reliable indicator of a neighborhood’s appeal on the Internet.

“Neighborhood Appeal is a free resource for people who are looking to move to a new neighborhood or travelers who want to find a nice area to spend the night,” says Michael Nirenberg, the website’s founder and chief “neighborhood enthusiast.”

The desire to live in an appealing neighborhood is a growing concern. Before deciding to move to a new neighborhood, people can use Neighborhood Appeal to find out the area’s appeal, or even ask the “natives” a question.

Good grades will help landlords attract the best renters.

Nirenberg started Neighborhood Appeal when he realized that the most important factor in choosing a place to live (or visit) is the area’s appeal.

“A lot of websites that analyze neighborhoods provide complex numbers and statistics,” Nirenberg says. Neighborhood Appeal simplifies all the numbers into a single, easy to understand grade. “Any child knows what an F means,” Nirenberg adds.

“Most people looking to move to or visit a neighborhood just want to know: is it a nice place?” Nirenberg continues. “Ultimately, the people who know the area first-hand will decide.” This is where Neighborhood Appeal’s user-generated grades shine.
According to the U.S. Census approximately 43 million Americans move each year. Of these people, 19% moved to a different county within the same state and 19% moved to a different state. Neighborhood Appeal is an easy way for people who looking to move to or a visit a neighborhood to check out its appeal.

Neighborhood Appeal allows discussion of just about any subject, topic, product or service, as long as it relates to the neighborhood. It is a place to announce you found a lost dog, need some help painting your house, or want to draw more people to a church or club event or fundraiser.

Michael Nirenberg, the founder of Neighborhood Appeal, has been on FOX news, the History Channel, PBS, Chicago’s WLS radio, quoted in the Wall Street Journal, FIRST for Women, and Whole Living magazine, and featured in other media sources. He is a practicing podiatrist, surgeon, forensic expert, walking instructor, and “neighborhood enthusiast.” Nirenberg has assisted law enforcement in homicide investigations involving foot-related evidence.

Nirenberg is currently expanding Neighborhood Appeal, adding a myriad of features and innovations. He plans to bring the platform to Canada, the UK and other countries.

American Apartment Owners Association | Company Website | Rental property management can be very demanding. Our job is to make this day-to-day property management process smoother. AAOA provides a host of services ranging from tenant screening to landlord rental application forms and contractor directory to apartment financing.

by Tim Blackwell

Not too long ago, multifamily industry training and Fair Housing consultant Anne Sadovsky found herself stopping a meeting because a property site manager kept her head down, fidgeting with her smart phone. The woman, about 40 years old, was seemingly oblivious to the discussion and full throttle into her device when Sadovsky put on the brakes.

“I finally said, ‘Are you doing something more important that what we’re doing right now?’ ” Sadovsky said. “She looked up at me and said, ‘Oh, no, I’m just looking for something to order.’”

When Sadovsky came up through the ranks of the apartment industry 40-plus years ago, the only orders she had during the workday were from her bosses. Failure to comply, she said, meant marching to the tune of a different order, the one that sent you packing.

“Heads would roll,” she said.

Today’s work environment is a little less rigid and much more accommodating to personal devices that are often blamed for distracting employees. Before personal technology, being disengaged at a meeting usually meant leaning back in your chair and twirling your pen or scribbling on your Daytimer. Today, just the presence of smart phones, iPads, and even laptops (is he really taking notes or posting to Facebook?) distract employees everywhere in the workplace.

It was a different time, even back in the 70s and 80s, Sadovsky concedes, but perhaps the work ethic and management of the day is a good history lesson that can be applied today. Employees are distracted and they need help to step back in line, she says.

Improve Property Management Staff Focus with Face-to-Face Accountability

In January, a San Francisco-based online meeting provider reported in a survey that most U.S. information workers multitask during meetings, which research shows lowers productivity, increases errors and causes stress among workers. Of 2,000 workers polled by Fuzebox, 92 percent said they have engaged in other activities while sitting around the conference table – 41 percent said they do it all the time or often. Tops among the multitasking offenses? Checking email.

Employees multitasking at meetings or just shunning work responsibilities to check social media create challenges for managers. The root of the problem, Fuzebox says, is a lack of face-to-face communication to hold employees accountable.

That resonates with Sadovsky.

“I think we went through a period where we didn’t have to oversee people so much because people were responsible,” she said. “They did what they were told to do and the way they were told to do it, and we were successful because of it. Today, you have to oversee them. You have to watch what they are doing. You have to stay on top of it, because they are so not-focused on work.”

Distracted Leasing Staff Affect the Bottom Line

Some may say that Generation Y employees are likely to be the most distracted because of their attachment to technology and dependencies on communication through electronic devices. However, according to one survey,middle-aged women are some of the most distracted, and not because they are spending time on Facebook or surfing the net. Females tend to get sidetracked at work because of personal and financial issues as well as a lack of resources.

In the multifamily housing industry, a distracted leasing agent or someone at the site level can cost an apartment property money. The 2013 Workplace Productivity Report shows that 25 percent of people studied were completely unproductive seven or more hours a week and that 22 percent of people were completely unproductive for five to six hours a week. Translated, that’s a day’s wage paid by an employer out the window.

Bringing a distracted worker back in line can be difficult for an already overloaded manager who has more front office responsibilities than other generations of site leaders, Sadovsky says. Increased supervision just adds to the daily laundry list, but it’s a necessary tool that managers today should pack.

“It’s truly hard to find people that you don’t have to (supervise), if, and I hate to say it, you want the job done right,” she said. “There has to be accountability. And there has to be oversight because this generation of worker gets sidetracked in their own stuff.”

Training and Supervision is Key to Reducing Distraction

Camden Property Trust’s Margaret Plummer doesn’t think that younger employees are more distracted than any other generation. She says that empowering technologically savvy Gen Y workers to work whatever way best fits, knowing there may be a tradeoff with some personal activity, can benefit the company in the long run.

“As kids, we were distracted at that age,” says the 46-year-old Plummer, who is Camden’s vice president of employee development. “Part of that is managing it. This group of kids has a different way of going about how to accomplish their tasks. Let them complete tasks the way they are comfortable doing it.”

But both Plummer and Sadovsky agree that a focused worker is a more productive, and that employees should be held accountable for their work and actions. Proper training is essential, especially in a day and time when workers truly have to multitask, whether in a meeting or not, because of the hectic pace of business.

Sadovsky suggests that managers commit to tools like online training programs to help shape employees. Most of all, get face-to-face with some good ol’ fashioned supervision.

“They are going to have to go back to truly supervising and overseeing the other people in the office,” Sadovsky said. “They need to know what their people are doing and they need to supervise it. Set some goals for them and get them out there. I think it’s just kind of gotten relaxed, and everyone kind of comes to work and does their thing.”

If you’re having trouble connecting with your residents, it might be communication error. According to nationally recognized body language expert Jan Hargrave, and many other professionals who study personality and motivational factors, only 7% of all communication is verbal.  It really isn’t the words you say that creates a lasting impression, it is how you say them, your posture and your tone.

Millions of dollars are spent each year on marketing research and efforts to discover what motivates buyers. Residential property research shows that renters want convenience, access to public transportation, open spaces and a safe place that feels like home. One thing that all of those needs have in common is an emotional connection. Understanding how a resident feels about your property (and the world in general) will help you build a stronger relationship with them.

Studying body language reveals some universal clues about individual personalities. While this isn’t an exact science, posture, facial expressions, subtle changes in tone or inflection and gait provide valuable insight to better understand your renters.

Hargrave says that a majority of all communication is non-verbal. Here are a few examples of how you can adjust your body language and interpret what your tenant is trying to tell you when words aren’t enough.

Open and Accepting

A person that stands straight, smiles, makes good eye contact and angles his or her body slightly toward you is generally open to communication and comfortable with the environment. She is more prone to reach out for a handshake. Most people identify this person as friendly and outgoing.  This type of tenant normally says what she means and expects you to do the same.

Shy and Awkward

A shy individual often lacks confidence. He rarely holds direct eye contact, avoids touching – sometimes is uncomfortable shaking hands – and creates barriers by folding arms across the chest, turning slightly away from you or grasping a book or other item in front of him.  You can put this person at ease by encouraging him to tell you what he needs to feel comfortable. Although community gatherings and parties may sound appealing, he will often be more motivated to look for apartments away from the crowd.

Aggressive or Angry

An aggressive personality type is often easy to spot. Avoids eye contact, angles the upper body away from you, generally has a classic “smirk” on the face, and walks with a swagger or extremely heavy foot step. These same clues also indicate an arrogant personality type. Your best strategy for communication with these personalities is to remain calm, let them feel like they are leading the conversation and avoid conflict by restating their needs to confirm you understand before adding new information.

Experts say that 38% of communication is expressed via tone or inflection. Listening for changes in the voice helps differentiate an aggressive personality from arrogant personality.

Personality Profiles Help Build Rapport

Regardless of the personality type involved, most people display common body language in response to stimuli. A slight, sudden lift of the eye-brow indicates heightened interest, biting one’s lip shows hesitation or nervousness, and standing with one foot slightly in front of the other reveals the person is assuming dominance in the situation.

Understanding a tenant’s personality helps build rapport because it improves communication, if you use the right techniques. Watch for subtle clues and respond with appropriate responses. For example, if your shy, awkward resident doesn’t want to renew the lease, it might be where her apartment is located in the complex. Before she walks out the door, discuss other apartments. If you can get her to open up, she might tell you that she really would like to be closer to the action, even if she doesn’t engage very often.

Tying it Together

Offering extraordinary amenities, onsite retail options and community-sponsored events makes your property appealing for residents. Properly maintaining the facilities, upgrading appliances and color schemes and perfectly manicured green spaces add value to your property. Developing a clearer understanding of diverse personalities as part of  relationship building strategies is one more tool that property managers can leverage to generate brand loyalty.

Appfolio | Company Website | LinkedIn Connect | AppFolio, Inc. develops Property Management Software that helps businesses improve their workflow so they save time and make more money.  Appfolio submits articles & blogs including topics of Resident Retention, Improved Owner Communication, Time Management, and more.

A lawsuit challenging numerous amendments to New York’s rent stabilization regulations was filed by major real estate organizations representing thousands of residential property owners.

The lawsuit seeks to overturn the amendments, challenging the authority of the new Tenant Protection Unit, created by Governor Cuomo. The apartment owners contend that the status of TPU is in question, since the state’s legislature has rejected the proposed funding of the watchdog agency on two occasions since it was enacted in 2011.

The suit claims there is no legal authority for establishing the TPU, which, despite the lack of any complaint by a tenant, audits individual apartment improvements that owners undertake to improve their properties.

The rental owners also contend that the Governor had no authority to create the TPU in the first place – and even if such authority existed, the TPU, as it currently functions, violates constitutionally protected due process rights of building owners by demanding that they reduce or refund rents without affording them an opportunity to be heard or appeal the TPU’s decisions.

The second component of the lawsuit challenges many of the 27 amendments to
the regulations made by DHCR on the grounds that those amendments either conflict
with the State rent laws or constitute a violation of the separation of powers. For example:

The newly adopted regulations contradict the strict four-year statute of
limitations created by the State Legislature in 1997 relating to rent overcharge claims by tenants and record-keeping obligations for property owners. In fact, the newly adopted regulations now allow rent challenges to be brought at any time, by any tenant, and encompassing any time period throughout the entirety of an apartment’s rental history;

The amendments authorize tenants to stop paying rent, without the approval of any agency or court, if they do not believe that the property owner has properly documented improvements made to their apartments prior to the tenant taking occupancy;

The law creates obstacles which prohibit property owners from collecting legally authorized rent increases for major capital improvements and vacancy increases;

The regulations re-prioritize violations so that minor, even unintentional acts carry the same punishment as more severe actions.

The suit was filed by the Rent Stabilization Association, the Community Housing
Improvement Program, and the Small Property Owners of New York, along with individual property owners. The organizations represent owners and managing agents of thousands of large, medium and small residential apartment buildings throughout the five boroughs that include approximately one million rent stabilized apartments.

RSA President Joseph Strasburg adds, “Property owners will not sit by and watch
as their constitutionally protected property rights are trampled upon by government at the behest of tenant advocates.” RSA Chairman Aaron Sirulnick warns that it is small property owners who are the most vulnerable, and that the regulations will hamper efforts to preserve affordable housing.

American Apartment Owners Association | Company Website |  Rental property management can be very demanding. Our job is to make this day-to-day property management process smoother. AAOA provides a host of services ranging from tenant screening to landlord rental application forms and contractor directory to apartment financing.

According to a press release that the U.S. Census Bureau shared late last month, 11.7% or 35.9 million U.S. residents moved their primary residence in the 2012-2013 year. This translates to a drop of about 12% compared to this same time period from the year prior.

When comparing the data found in the Geographical Mobility report published in 2013, these statistics show 2013’s numbers to be very similar to the 11.6% reported in 2011.

Researchers found that 48% of Americans claimed that the move was housing-related, 30.2% was a result of family, and 19.4% said their move was fueled by employment-related reasons.

What do these moving trends mean for multifamily?

We have three solid years in which moving trends have remained steady or improved nationally, with certain specific metropolitan areas seeing enough growth to maintain the averages for their whole region.

At 13.4%, the Western region of the United States has actually seen the highest percentage of all movers. This is followed by the South, who received 12.8% of our nation’s movers, and the Midwest who turned in an even 11%. The region with the lowest mover rate is the Northeast, who had 7.8% in the last year. According to these trends, industry professionals can expect to see at least these same percentages with a slight improvement being the most likely result of all the new activity planned for 2014.

Multifamily News identified that two-thirds of today’s movers are staying within their same county of origin. In addition, 40% of these movers are staying within 50 miles of their current home.

To the multifamily apartment owners or managers, this means that the bulk of their new renters are likely going to relocate from a relatively short distance. The method in which we’re planning to market our properties needs to hone in on this close-proximity trend.

When it comes to further segmenting this short distance market, it has been found that existing multifamily residents are more likely than current homeowners to move. Data for 2012-2013 reports that 24.9% of renters moved throughout the year, but only 5.1% of homeowners did the same during this time period.

Outside of regional differences, analyzing other areas of data gives property owners and managers a way of refocusing specific communities’ existing marketing plan so that it identifies patterns of the most likely renters in 2014. Job relocations, for example, which account for about 25% of our total movers, have a tendency to pay higher rents initially before settling into any community permanently. This should call for a differentiated marketing approach.

Is your multifamily real estate market already experiencing any of these trends?

Justin Alanis | Company Website | LinkedIn Connect | Justin Alanis is the Co-Founder and CEO of Rentlytics Inc.  Rentlytics is based in San Francisco, CA providing deep analytics for apartment property owners and managers. View and analyze property operational and financial metrics more effectively and identify issues.

Tip #255: Say What You Mean

Most landlords go out of their way to make lease agreements and house rules that are clear and concise, and leave no room for misinterpretation. But, if you using the term “nonrefundable” with the word “deposit”, you may be asking for problems.

That’s because “deposit” implies that the funds are to be returned. When you say “nonrefundable deposit”, your tenant hears, “I’m going to hold on to your money, and then not give it back to you.”

This is particularly confusing for tenants when you mention both fees and deposits in the same conversation, or in the lease agreement.

Rather than using “nonrefundable” anything, consider simply calling the charge a “fee” — application fee, late fee, early termination fee, pet fee. That can save you loads of time and trouble debating the language with disgruntled tenants.

For good measure, check your local laws for any restrictions on fees — or deposits — that can be charged to tenants.

American Apartment Owners Association | Company Website |  Rental property management can be very demanding. Our job is to make this day-to-day property management process smoother. AAOA provides a host of services ranging from tenant screening to landlord rental application forms and contractor directory to apartment financing.

Rental Property Owner and CEO Of Cold Craft, Inc. Heating and Air, Stresses The Potential Disastrous Consequences Of Not Maintaining The Buildings’ Equipment

CNN announced on February 24, 2014 that on February 23, 2014 a water heater pipe in Legal Seafood in a New York mall was the cause for a carbon monoxide death and the illness of others. This story was also reported on ABC7 news NY; FOX News, Newsday, NBC New York carbon monoxide poisoning from a water heater, and it makes a great reminder for how important it is to maintain the equipment in all buildings including commercial and residential properties and to have new carbon monoxide detectors. These CO detectors are good for approximately five years, so follow manufacturer’s instructions on replacement.

Susan Nichol is a rental property owner as well as the CEO of Cold Craft, Inc. Every week they observe people taking on the risk of either deferred maintenance or do it yourself heating installations. “To avoid risking the health and well-being of my tenants and my investment I act on the importance of maintaining the most expensive parts of my rental homes, the heating and air conditioning and hot water systems.” The current economy, perhaps the desire to maximize profits or lack of knowledge of equipment maintenance has been responsible for building owners and managers to delay or defer the maintenance on the property’s equipment.

What are these risks? First and foremost carbon monoxide poisoning and death or combustion issues like a fire in the furnace are the highest risk the property owner can take. Check on line there are cases every winter for years of people having issues with the furnaces. Owners and managers need to keep records of the maintenance so should a problem crop up the owner/manager can show a track record of maintaining the equipment. This will show that at the time of the maintenance the equipment was working properly. Regular maintenance also provides the financial rewards of extending the usable life of your equipment.

Typically these HVAC units are out of sight and out of mind, so they do not get the needed attention that is needed to maximize the efficiency and extend the equipment’s usable life. HVAC units are in closets, basements, crawl spaces, on rooftops or simply in the attic, out of the way places that can go unnoticed. This is why it is important to plan the maintenance with a reputable company to make sure that the equipment is running at its best at any age or condition. This equipment needs to be maintained to avoid surprises. “The key to maximizing your money with rental property is to make sure the expensive equipment in the home (HVAC which means, heating, ventilation, and air conditioning) are maintained so the equipment will last longer. This means that the replacement can be delayed or planned for.” Susan Nichol, Investment Property Owner.

There is another benefit too and that is planned replacement. When the HVAC equipment is getting towards the end of its usable life the replacement of the equipment can be planned so it has the least impact on the tenant. Planning the replacement can be done when the unit is vacant, when the tenant is aware of upcoming work, and planning allows the replacement to be done in the spring or fall when the weather is mild should anything go wrong and the owner/manager is not out of rental money because of a lack of heat.

Unfortunately, Nichol’s properties are out of state so she is unable to take advantage of her own firm to work on her properties, but they are still maintained. “I have a couple of business rules when it comes to rental property; the most important one is that I need to be able to sleep at night. Looming expenses and possible disaster from deferred HVAC maintenance is not a chance that I am willing to take.” says Nichol. That’s why Cold Craft advocates annual safety inspections on combustion appliances, new Co detectors (especially to replace the units that are over 5 years old – see manufacturer’s replacement suggestions and new batteries annually).

Cold Craft, Inc. opened for business in 1991 serving the San Francisco bay area in heating, air conditioning and refrigeration for both commercial and residential aspects of the trade. The company has a safety focus both for our employees and our customers. Its continuous improvement program includes incentives for education such as being NATE certified; this is why Cold Craft was awarded the Circle of Excellence from NATE, the gold standard in HVAC. The firm also has been Diamond Certified for 12 years. The employees also pride themselves on offering new technology, renewable and energy efficient solutions. Cold Craft’s goal is to continue to grow in the HVACR industry in the bay area and hire additional experienced technicians and installers. Learn more at http://www.coldcraft.com, or follow Cold Craft, Inc. on Twitter @suzi_coldcraft