Category Archives: Real Estate Investing

Relocation Questions & Data

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This month the annual Corporate Housing Industry Report came out showing that gross rents for Serviced Corporate Apartments was $2.66 Billion in 2012 and 37% of that business or $984,200,000.00 was a direct result of Relocation needs.

According to the Annual “By Owner” Corporate Housing report 43% of property owners report having tenants related to a Relocation.

Last year the CEO of CHBO served on the US Advisory Council for the ERC / Employee Relocation Council the trade organization that represents the entire Relocation Industry and according to ERC we have seen a return to Pre-Recession “New Hire” Relocations but we are still waiting to see a resurgence in “Talent Management” Relocations.

What does this means for you?  We expect a continued increase in relocations in 2013!

The NY Times recently ran an interesting article “To Relocate or Not? It’s More Than Math.”  They asked some great questions about minimizing risk.  We believe that taking the time to “Test Drive” a neighborhood by staying in Corporate Housing before you buy will allow you to make the best real estate investment choice.

Do you know anyone who is “testing” a neighborhood before they buy?

 

Americans Buying More Vacation Rental Homes

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According to data released last week by the National Association of Realtors, Americans are having a love affair with the second home.

The number of vacation homes sold in the U.S. went from 502,000 in 2011 to 553,000 in 2012, and of all home transactions in 2012, 11 percent were vacation homes, according to NAR.

What Does a Typical Vacation Home Buyer Look Like?

A typical second home buyer was, on average, 47 years old. S/He has a median household income of $92,100, and lived a median distance of 435 miles from their primary residence.

Are Investment Owners Buying Too?

While this report comes as good news for vacation rental property owners, the report shed light on investment property owners too. NAR reported that investment homes comprised 24 percent of all real estate transactions in 2012, which was a significant decrease from 27 percent reported in 2011.

If you own a second home or vacation property and are thinking of renting it out, consider marketing it as a corporate rental too. Read our tips, “Should Your Monthly Furnished Rental be a Weekly Furnished Rental Too?“

What Are the Best Markets for Buying a Rental Home?

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The research firm RealtyTrac recently conducted a survey of the best U.S. markets to buy a single family home for the purpose of renting it out.  The firm picked the top 20 markets that represent the best chance for generating good cash flow.

Eight markets in Florida, which was hit hard by the housing bubble, made the list, as prices make a strong return. Also, Atlanta and Phoenix topped the list, which are two of the most popular cities searched for short-term corporate housing rentals on CorporateHousingbyOwner.com.

If you’re in the market for a rental home – and are considering renting it out traditionally or as a corporate rental – consult this list to find a market where you might find the most success.

best markets for rental homes

 

Wondering if now is a good time to buy? A combination of relatively low prices, extremely low interest rates, and a strong rental market might help you decide. Read our blog post, “Is Now A Good Time to Buy Real Estate?“

Is Now a Good Time to Buy Real Estate (and Invest in Corporate Housing)?

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is now a good time to invest in real estate

It’s no secret that the housing market is in recovery mode. It’s quickly become a seller’s market once again.

In our Annual “by Owner” Corporate Housing Report, we talked to hundreds of investment property owners across the country:
  • 19% said “Yes” they will buy this year, up from 17% last year
  • 21% said “Yes” they will buy in the next 2-3 years, up from 15% last year
  • Only 4% said they were waiting to buy when banks to loosen lending requirements
  • Only 17% said they were “DONE” and not going to buy anymore

With all this talk of housing recovery, you may be wondering if now is the right time to buy.

While real estate professionals can often make the case for buying at any time, if you are in the market to buy an investment property, it might be a great time to do so for these reasons:

Low Interest Rates: I have a feeling we will never see interest rates this low again in our lifetime.

Values Low:  Home values are still relatively low as the housing market bounces back to normal. Low prices and low interest rates make for the perfect buying storm.

Pent Up Sellers:  Many homeowners who wanted to sell long ago but didn’t want to sell their home at a low price or risk having it sit on the market for years are finally taking the steps to sell their homes. This brings about the potential for great inventory for investors and home buyers alike. (Remember, quality properties that are slowly making their way onto the “for sale” market are selling fast. Buyers need to identify what they want, watch for it, and move quickly to make a deal.)

As always, before you buy, make sure you find the right investment solution for you. Just because it’s a good time to buy doesn’t mean you should buy. You need to understand what you have and need, create a business plan, and put your plan into action. Talk to your financial advisor and trusted business advisers to learn if now is a good time for you to invest in real estate and corporate housing.

7 Ways to Limit Your Liability When Offering Rental Management Services – Part II

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limit your rental liability as a property managerIf you’re a real estate agent looking to broaden your business offerings, you may have considered adding corporate rentals and property management to your services. While doing so is a great way to diversify your business, and add a new level of income, there are business risks to taking on rentals. In this two part series, we’re offering tips you can employ to safeguard your brokerage business when adding rental management services.

Tip #4:  Get Contracts

You don’t want to enter the rental management business on a handshake. If you’re going to manage the property, you’ll need a solid contract in place that details your role and responsibilities, as well as limits your liability for issues out of your control. Make sure you put any discussions with owners in writing at all times – you don’t want to have disagreements that turn into a he-said, she-said battle.

Tip #5:  Have Insurance

You will need professional and general liability insurance for the property management side of your business. You also need to ask your clients to include your company in their homeowner and landlord insurance policies.  This prevents you from being sued if a tenant gets injured or other issue arises. Ultimately the property insurance should cover you to prevent you from getting sued.

Tip #6: Be Picky

While it sounds ideal to manage any and all properties that knock on your door, you’ll want to use your discretion. Only take on what you can manage, and be picky about what properties you manage. Doing so will ensure you do a good and through job with all your clients and thus limit your liability. You may want to manage properties only within a specific geographic location or only a specific type of property (single family home), etc. Also, work with clients who value you and are willing to pay your fee. Be picky about who you represent!

Tip #7: Have a Point Person

To limit your liability, you’ll want to have a single point person for property owners and tenants. This is an opportunity for renters and tenants to develop a relationship with your company, one that is based on open communication and trust. Your point person will want to respond to inquiries immediately and quickly resolve problems that arise before they become liabilities.

Missed Tips #1-3? Read Part I here!

7 Ways to Limit Your Liability When Offering Rental Management Services – Part I

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limit your rental liability as a property managerIf you’re a real estate agent looking to broaden your business offerings, you may have considered adding corporate rentals and property management to your services. While doing so is a great way to diversify your business, and add a new level of income, there are business risks to taking on rentals. In this two part series, we’re offering tips you can employ to safeguard your brokerage business when adding rental management services.

Tip #1:  Keep It Separate

If you’re going to add rental management to your brokerage’s offerings, you’ll want to set up a separate legal entity. This provides you with two benefits:

  1. It will make your accounting easier – as you’ll keep your books separate and you’ll be able to analyze your numbers on both sides of your business individually.
  2. It will also minimize the liability on the brokerage side of your business and vice versa.

Tip #2:  Go Big or Go Home

Don’t offer rental management services only as a favor to a friend or client. If you’re going to do it, make sure it’s part of your core business model. You need to treat rental management like a business. Know your local laws when it comes to contracts, security deposits, background and credit checks, etc. Also, you must know how and when to disclose that you’re a broker to any client you work with.

You’ll also want to make sure you provide proper training to your staff with a procedure manual that everyone is responsible for learning and following. Remember, a small mistake can be a costly mistake, so make sure if you’re going to be in the rental business, you’re treating it like a real business, not a side hobby or favor.

Tip #3: Vet Properties Before Representing Them

You want to make sure any property you manage meets all legal and safety requirements, otherwise you could be putting a renter and yourself into a messy situation. Any deferred maintenance must be taken care of before a tenant moves in. Your client must have the proper insurance as well – and provide you with such paperwork. Also be mindful of regulations when it comes to amenities such as pools.

We’ll share tips 4-7 in next week’s blog post  - to be continued…

CHBO’s By Owner Corporate Housing Report Now Available in Kindle Reader Version on Amazon.com

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Press Release from CHBO

DENVER, March 06, 2013 – CorporateHousingbyOwner.com (CHBO), an online marketplace connecting private landlords of furnished, short-term rentals with tenants in need of temporary housing, makes the results of its 2012 By Owner Corporate Housing Annual Report available to millions of Amazon Kindle users around the world. For $.99, Kindle users can download the report, which is chocked full of stats, trends and insights for individual landlords managing furnished rental properties.

Further, the By Owner Corporate Housing Annual Report also is available in paperback for $24.95 on Amazon.com.

“Our Annual Report is an important tool that individual landlords managing furnished properties around the world depend on for the latest data and trends in corporate housing management and investing,” says Kimberly Smith, co-founder and CEO of CHBO. “By partnering with Amazon to distribute our Report, we are enabling great reach through the largest online global retailer. The more individual landlords we can reach and therefore help, the better!”

The 2012 Annual Report, released by CHBO in January 2013, includes information on:

Security Deposit Trends. Are individual property owners requiring security deposits or is the trend moving toward Accidental Rental Damage Insurance? What is the average security deposit fee?

Outlook on Real Estate Investing. Are corporate housing investors profitable or break-even? Do they plan to invest in more real estate in 2013?

Short-Term Rental Regulation. How is regulation of short-term rentals, particularly vacation rentals, impacting the corporate housing industry.

The survey was completed by individuals who owned or managed a furnished monthly residential rental property in 2012. The By Owner Annual Report reflects findings from individual property owners, rather than from full-service, corporate housing companies.

To download the Report on any Kindle Reader, visit http://www.amazon.com/Corporate-Housing-Annual-Report-ebook/dp/B00BLWBBD6/ref=sr_1_1?s=books&ie=UTF8&qid=1362082927&sr=1-1&keywords=CHBO.

To receive a paperback version of the Report, visit http://www.amazon.com/2012-Owner-Annual-Report-Corporate/dp/1482348500/ref=sr_1_3?s=books&ie=UTF8&qid=1362083314&sr=1-3&keywords=CHBO.

About CorporateHousingbyOwner (CHBO)

CHBO was founded in 2006 to connect private homeowners and real estate investors offering furnished, short-term rentals with corporate housing seekers such as traveling executives, relocated professionals, traveling nurses, actors, athletes, etc. CHBO gives individual homeowners and investors tools to manage a corporate housing property themselves and helps them market their properties to a mass audience turning to corporate housing to fulfill their lodging needs. Visit online at www.corporatehousingbyowner.com.