Posts Tagged ‘AAOA’

Best Bang for Your Buck: Remodeling Costs vs. Value

Written by Apartment Management Magazine on . Posted in Blog

Apartment Unit UpgradeWinter’s the best time to plan for the upcoming remodeling season.

When it comes putting your hard-earned money to work for you, The National Association of Realtors®  2014 Remodeling Cost vs. Value Report proves it pays to focus on curb appeal.

A home’s curb appeal is crucial because it can be the first thing buyers — and tenants — notice about a home.

“With many factors to consider such as cost and time, deciding what remodeling projects to undertake can be a difficult decision for homeowners,” said National Association of Realtors® President Steve Brown, co-owner of Irongate, Inc., Realtors® in Dayton, Ohio. “Realtors® know what home features are important to buyers in their area, but a home’s curb appeal is always critical since it’s the first impression for potential buyers. That’s why exterior replacement projects offer the greatest bang for the buck. Projects such as entry door, siding and window replacements can recoup homeowners more than 78 percent of costs upon resale.”

Eight of the top 10 most cost-effective projects nationally, in terms of value recouped, are exterior projects. Realtors® judged a steel entry door replacement as the project expected to return the most money, with an estimated 96.6 percent of costs recouped upon resale. The steel entry door replacement is consistently the least expensive project in the annual Cost vs. Value Report, costing little more than $1,100 on average.

deckingA wood deck addition came in second with an estimated 87.4 percent of costs recouped upon resale. Two different siding replacement projects also landed in the top 10, including fiber-cement siding, expected to return 87 percent of costs, and vinyl siding, expected to return 78.2 percent of costs. Out of the top 10 projects, the fiber-cement siding replacement project improved the most since last year, with costs recouped increasing by more than 15 percent.

Two garage door replacements were also in the top 10; a midrange garage door replacement is expected to return 83.7 percent while an upscale garage door replacement follows closely at 82.9 percent of costs recouped. Rounding out the top exterior remodeling projects were two window replacements; a wood window replacement is estimated to recoup 79.3 percent of costs and a vinyl window replacement is estimated to recoup 78.7 percent of costs.

According to the report, two interior remodeling projects in particular can recoup substantial value at resale. An attic bedroom is ranked fourth and is expected to return 84.3 percent of costs; nationally, the average cost for the project is just above $49,000. The second interior remodeling project in the top 10 is the minor kitchen remodel. The project landed at number seven and is estimated to recoup 82.7 percent of costs. Nationally, the average cost for the project is just under $19,000.

The improvement project likely to return the least is the home office remodel, estimated to recoup 48.9 percent.

For the report, Realtors® provided their insights into local markets and buyer home preferences within those markets. For 2014, the national average cost-value ratio stands at 66.1 percent, a jump of 5.5 points over last year and the largest increase since 2005, when the ratio increased 6.1 points to reach a high of 86.7 percent. For the second consecutive year, Cost vs. Value data shows that the value of remodeling is up for all 35 projects included in the survey.

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Additionally, for the first time in four years, improved resale value of residential housing had more of an influence in the cost-value ratio than construction costs. A modest 2.2 percent increase in average national construction costs was more than offset by an 11.5 percent improvement in average national resale value.

The 2014 Remodeling Cost vs. Value Report compares construction costs with resale values for 35 midrange and upscale remodeling projects comprising additions, remodels and replacements in 100 markets across the country. Data are grouped in nine U.S. regions, following the divisions established by the U.S. Census Bureau. This is the 16th consecutive year that the report, which is produced by Remodeling magazine publisher Hanley Wood, LLC, was completed in cooperation with NAR.

“Every neighborhood is different and the desirability and resale value of a particular remodeling project varies by region and metro area. Before undertaking a remodeling project, homeowners should consult a Realtor® as they are the best resource when deciding what projects will provide the most return upon resale,” said Brown. “Realtors® have a unique understanding of local markets, home features and buyer preferences and know that there are a variety of factors that affect a home’s value, such as location, condition of surrounding properties and regional economic climate.”

improvinghousingmarketSeven of the nine regions covered in the report outperformed the national average, a distinct improvement over 2013, when just four regions performed better than average. Once again, the Pacific region, consisting of Alaska, California, Hawaii, Oregon and Washington, led the nation with an average cost-value ratio of 88 percent, due mainly to strong resale values. The next best performing region was West South Central with 76.4 percent, followed by three regions tied at 74.6 percent: South Atlantic, which improved from 63.7 percent in 2013, New England, which improved from 56.2 percent in 2013, and East North Central, which improved from 54.8 percent in 2013.

To read the full project descriptions and access national and regional project data, visit www.costvsvalue.com.

“Cost vs. Value” is a registered trademark of Hanley Wood, LLC.

The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.

New Tenant Legal Fee Equality Law

Written by Apartment Management Magazine on . Posted in Blog

Legal FeesTouted as a major victory for New Jersey tenants, Governor Christie signed into law a bill that gives tenants the right to collect lawyer’s fees and costs from landlords when they are successful in court.

The rule applies if the landlord has reserved the same right in the lease. The new law applies to all leases entered into on or after February 1, 2014.

Prior to the enactment of the law, landlords could reserve the unilateral right to be compensated by tenants should the landlord prevail in any legal action.

According to Matt Shapiro, President of the membership-based New Jersey Tenants Organization (NJTO), this new law is the most important advance in tenants’ rights in many years. “New Jersey has some of the best tenants’ rights laws in the country, but, until now, not when it came to these unfair legal fees,” said Shapiro. “Nearly every lease in the state has one of these clauses giving the landlord the right to sue for legal fees and costs in addition to whatever else he’s suing for, but it’s been a one-way deal.”

The NJTO successfully argued that the  a one-way legal fees provisions could be intimidating to tenants, who had little bargaining power to change the terms of the lease agreement.

According to Shapiro, a major advantage of the new law is the requirement that landlords inform tenants of the requirement by using bold print in the same clause that gives the right to landlords to collect legal fees.

“Now tenants will finally have a fair shot at having their day in court,” Shapiro says.


logo_aaoa 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. 

How to Tell That Your Lease is Working

Written by Apartment Management Magazine on . Posted in Blog

Lease_RenewalMany of us think of a lease agreement as the ultimate weapon, wielded only when there’s a legal dispute.  The rest of the time it sits dormant in a file drawer.

But a lease needs to do more than that.

Fortunately, few of us will have to put our lease to the ultimate test. Yet all of us need it as a day-to-day guide to managing the rental property. Tenants need it, too, as a daily reminder of what is expected of them.

If you are having problems with your tenants, than your lease may not be working.

That’s why it’s important to be finicky about how your lease agreement reads. The more specific the lease is to your rental property, the more credibility it has with your tenants.

Using generic lease forms that set out the rent requirements and barely more than that leaves everyone in the dark. That can generate conflicts.

Likewise, a lease with too much legal mumbo jumbo is like having no lease at all. If the tenant can’t understand it, they are more likely to ignore it.

View the lease less as a legal document, and more as a road map for the relationship with the tenant. It will be a more effective tool if you hold your tenants to the rules, but also meet your own responsibilities, like quick response to a repair request or noise complaint.

Be prepared to enforce any policy stated in the lease. Don’t use tough language if you don’t plan to enforce it — like threatening to evict a tenant for getting a pet, then turning away when it happens. Otherwise, the tenant will soon call your bluff, and problems will spiral.

Similarly, don’t accuse tenants of breaking the lease when they do something that’s not in there.

Stay in your tenant’s mind during the term of the lease. Something as simple as a rent receipt or email can remind tenants they are under a lease agreement.

Make sure your lease agreement is something you can live with — and it will be much easier for your tenants to live with it, too.


logo_aaoa 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. 

3 Things Landlords Need to Know About Going Smoke-Free

Written by Apartment Management Magazine on . Posted in Blog

Smoke-Free-Apartments

With all the benefit of smoke-free rental housing, you may have decided a smoking ban is right for you.  There are several how-to guides to lead you through the process, but there are a few things you should know before you adopt your smoking ban:

1. To be enforceable, the no-smoking policy must be outlined in the lease agreement. Many landlords choose the easy option of attaching a Smoke-Free Lease Addendum to their existing lease. We’ve provided a sample of such an addendum in our post How to Draft a Non-Smoking Lease Agreement.  Note that the addendum is signed by the tenant.

But don’t stop there.

In addition to adding that lease addendum, it is important to re-read your lease agreement and all other attachments, looking for contradictions or omissions. For example, does your lease also provide for a smoking lounge or permissible places to smoke?  Does that contradict the Smoke-Free Addendum? If so, the contradiction must be resolved or the policy may fail.

Do your house rules include the smoking ban?

Review your remedies in the lease.  You need to have the right to evict a tenant who violates the smoking ban.  Be aware of any policies that require a warning before you take action against a tenant, particularly if that warning must be made in writing.

2. While the heart of the smoke-free policy is in the lease, in practice, it is easier to enforce those provisions if you make the non-smoking policy crystal clear to tenants from the very start.

Include “no-smoking” in your rental ads to discourage applicants who aren’t sure they can comply with the policy. List your vacancies in smoke-free rental listing databases to increase the odds of finding applicants who embrace the smoke-free policy.

Reiterate the smoking policy when you speak with prospects.

Include no-smoking signs around the property.

3. A sample smoke-free lease addendum may only cover tobacco smoke — cigars, pipes and cigarettes. If you want to include smoking cannabis or other “herbal” cigarettes, it is best to be clear in the addendum.

Enlist the help of a landlord attorney if you want to be sure your new lease is ironclad.


logo_aaoa American Apartment Owners Association

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.

Landlord to Pay $20,000 Over Leasing Policy

Written by Apartment Management Magazine on . Posted in Blog

The owner and manager of an apartment complex in Kansas City, Missouri have agreed to pay $20,000 to resolve a complaint that they discriminated against a tenant with a disability.

The allegations stem from the tenant’s request to have a live-in caretaker.

Bidding on a homeAccording to the charges, the landlord’s policies required a tenant to remain in an apartment for six months before adding another person to the lease. The tenant told the apartment management company that her sister was willing to move into the apartment and provide the necessary care. The woman’s doctor documented her need for the accommodation, but the management company denied her request.

HUD, which pursued the claim, further alleged that the woman was forced to vacate her apartment and move to different housing out of state because of the management company’s refusal to grant her request.

The Fair Housing Act requires housing providers to make reasonable accommodations in their rules, policies, practices or services when needed to provide persons with disabilities an equal opportunity to use or enjoy a dwelling.

“When it comes to residents with disabilities, the rigid application of the same rules you apply to others can result in the denial of housing opportunities,” said Bryan Greene, Acting Assistant Secretary for Fair Housing and Equal Opportunity.

The owner and management company have agreed to pay the woman $20,000, adopt and implement a reasonable accommodation policy, and provide fair housing training for all employees that interact with tenants.


logo_aaoa American Apartment Owners Association

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. 

End-of-Year Lease Check-Up

Written by Apartment Management Magazine on . Posted in Blog

Lease_RenewalAs the year comes to a close and a new one is set to begin, it’s a good idea to make sure your tenant leases are in order.

Simple oversights or non-compliance can lead to headaches, lawsuits, and if you’re not careful, thousands of dollars of losses.

Here are a few items you need to review:

1. Security Deposit Terms
Security deposits are perhaps the biggest bone of contention for both landlords and tenants.

One of biggest issues that often comes up is the actual amount of the deposit. Make sure that you are not overcharging tenants for their security deposit, or you could end up in hot water.Each state has very specific laws that regulate security deposits. It is worth a quick check to make sure your state has not changed their laws over the last year, and double check that you are compliant with any limitations written into the law.

Another hot button is when the security deposit needs to be returned. Make sure your policy is in line with state law.

If you allow pets, be sure to clearly stipulate whether a separate pet deposit is required, what the deposit covers, and when it will be returned upon acceptable surrender of the unit.

Be careful to check that your security deposit is clearly delineated from other fees that you may be charging, especially the non-refundable fees.

2. Who is Actually Living in Your Unit?
It is extremely common for tenants to flow in and out of a unit, without the landlord’s knowledge. One tenant moves on, and another one takes their place…but nobody notifies you.

In order for you to be able to enforce the provisions of your lease, every adult tenant in the unit needs to be listed on the lease.

So, it probably can’t hurt to send a friendly end-of-year notice to your tenants, confirming who is supposed to be living in the unit, based upon the names on the lease.

If you suddenly learn that the tenants have changed, you should run a tenant check on the new tenants and amend your lease to reflect the changes (assuming the results of the tenant background check are acceptable).

3. The Potential for Crime
Make sure your lease is compliant with the laws of your state in regard to criminal behavior.

Many cities and states are enacting ordinances that make landlords responsible for tenant crimes and other actions. It is not uncommon for these laws to require landlords to take legal action against a tenant in order to avoid hefty fines on the landlord.

In light of this reality, it is especially important to confirm that the tenants who signed the lease originally (those who passed a criminal background check) are still the same tenants that occupy the unit.

If not (and if they have unacceptable criminal backgrounds), you could find yourself in a heap of trouble if they commit a crime in your unit.


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About the American Apartment Owners Association

American Apartment Owners Association offers discounts on products and services for all your property management needs. Find out more at www.joinaaoa.org.

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