By Steve Abramowitz

My father was built like a linebacker and hollered like a coach. One

By Steve Abramowitz

My father was built like a linebacker and hollered like a coach. One evening in the late 1950s, I accompanied him as he went door-to-door to collect rents. A tenant called Schoenfeld—I only recall his surname—paid his rent reliably, but he was always a month late and he didn’t include the late fee. This drove my father “nuts.” That night, he unloaded on him. When I asked my father why he had to be so hard on Schoenfeld, he had a few choice words for me, too.

“Stevie, you’ll go to one of those pom-pom colleges,” my father said. “I graduated from the school of hard knocks. You’re too soft. Don’t be a wimpy landlord.”

Today, I, too, am a landlord, and have been for the past four decades. Along with my wife, I’ve owned 30 or so properties over the years, and we still own 12 today. I never wanted to be a pushover for my tenants, but I also never wanted to pulverize the lives of people who, in some sense, were in my care. Folks who rent worry about their safety, their comfort and their budget, just like homeowners do. Pride of ownership is fine as far as it goes. But what about pride of partnering? Of course, there’s an inherent conflict of interest and a hierarchical relationship between owners and renters, but I believe there’s also a common thread. Both want a living space that’s functional and presentable.

Partnering doesn’t only help the renter. We once had a scheduling snafu and couldn’t arrive in time to meet a prospective tenant at the property. The vacating person offered to show her around the apartment on his own time. I like to think he was returning the respect he received during his stay with us.

Though never reviewed on Yelp!, I know I’m appreciated. In the midst of the COVID scourge, we voluntarily renegotiated leases and, in one instance, gave a single working mother a two-month rent holiday. We set up a delayed payment schedule for a valued renter whose finances were temporarily tied up in a divorce proceeding. Over time, I collected almost all the rents due. A prospective buyer of a fourplex once requested multiple walk-throughs that unduly inconvenienced people. We gave everyone a onetime $25 rent credit.

Compassionate landlords are often derided as naïve by the real estate cognoscenti, who say our trustworthiness is just a cover for our spinelessness and that we’re frequently duped by deadbeat renters and unscrupulous service people. Unfortunately, I think this is sometimes true, and it behooves landlords to be vigilant.

I made a colossal blunder in 2015, when a fire destroyed our 16-unit Victorian office building, the crown jewel of our mom-and-pop enterprise. To my dismay, I discovered that I’d neglected to get insurance coverage for loss of rents. For five months, I had the usual fixed expenses like mortgage, insurance, and property taxes, with zero income to pay them. I can still hear replays of my father’s admonition about my unfitness for business.

Remember those eight wonders of the world? You’re probably also well-versed in the wonders of jacking up rents as fast and as high as local regulations permit. Besides being repugnant, that playbook is financially counterproductive. It’s a sure way to alienate renters and motivate them to suddenly come up with problems that need fixing.

That brings me to some real estate blasphemy: Macho management is a losing financial proposition. I don’t like to raise rents too much because I risk losing good tenants. In my book, if there are no calls, no problems and reliable rent payments, I’ll only ask for a small increase. Recently, however, I blew it. I raised a responsible renter $100, and she left in a huff. “So, what,” you say? “Just increase the rent by $200 on the bloke coming in.” Talk about naïve. First, I had to primp the unit, including $200 for carpet cleaning, $175 to caulk the tub and another $200 to fix a leak under the kitchen sink. Next, I had to pay $5,000 to paint half of the two-bedroom duplex.

Sound bad? We aren’t done yet. Throw in a month’s “rent up” fee—the payment to a real-estate broker to find us a new tenant. Add in the lost income from a unit that’s vacant for at least a month, while we prep the unit and find a new renter. It might take over two years to recoup these various expenses. I’ll place my bets on longevity any day. Ditto for my property manager, who has held my hand through 38 years and many rocky times.

By my parents’ standards, I was never cut out to be a landlord, and I’m still haunted by my father’s misgivings about me. My life and career were jumpstarted by the diligence and perseverance of my parents, and—strange as it may sound—that’s made me glad I’ve been a responsive, caring landlord. I feel doing so has enriched the lives of my renters, folks who didn’t get as good a number in the birth lottery as I did.

Steve Abramowitz is a psychologist in Sacramento, California. Earlier in his career, Steve was a university professor, including serving as research director for the psychiatry department at the University of California, Davis. He also ran his own investment advisory firm. Steve’s previous article was Calling for Yield. This article first appeared in HumbleDollar.com and has been republished with its permission.

By Dave Tourjé, President, Alpha Structural, Inc.

For Dave Tourjé, the

By Dave Tourjé, President, Alpha Structural, Inc.

For Dave Tourjé, the founder of earthquake retrofitting firm, Alpha Structural, concern about earthquake and the need for seismic retrofitting, were not of grave concern as they are today. Dave started in the construction business by specializing in foundation repair of hillside homes, failing retaining walls, seismic retrofitting, and every other kind of structural repair for the hillside and structural problems he had dealt with as a Mount Washington local working in construction. Today, Tourjé reflects on the difference in the construction trade between the early days and now, “It was an unformed trade. There was no foundation repair. There was no consciousness of it, it wasn’t in the real estate community like it is now, it just wasn’t a known problem.”

Those early days were prior to the major earthquakes that would erupt in years later within the greater Los Angeles area and, as a result, Dave’s field of construction would be changed forever. In 1987, Los Angeles residents experienced the Whittier earthquake at a magnitude of 5.9. Just a few years later, in 1994, we saw the Northridge earthquake wreak devastating blows on infrastructure, homes and apartment buildings, and from that was born seismic retrofit codes for the first time in Los Angeles. Dave recalls the change in the structural industry that came as a result of that natural disaster. “It kept evolving where there were more earthquakes, more floods, more problems. Then that would make its way into the codes and into the consciousness of realtors… and the need just became more and more evident.”

Santa Monica was the first city within Southern California to establish aggressive regulations targeted toward wood-framed soft-story structures because of the 1994 Northridge earthquake. Many other cities followed suit, with the City of Los Angeles issuing The Mandatory Retrofit Program under Ordinance 183893 in November of 2015. Attempting to stop history from repeating itself, these codes went into effect and were and still are mandatory for property owners to address. Once Los Angeles was waking up to the dangers of buildings not being structurally sound, Alpha Structural was standing ready to bring them up to current seismic code to structurally protect against future earthquakes.

Today, while every property that requires a retrofit is not yet complete, thousands of them have been structurally reinforced, brought up to code, and deemed safe per today’s standard. Alpha Structural is proud to have had a large hand in accomplishing that for thousands of properties all over Los Angeles and Orange County. With years of experience and technical expertise, Alpha Structural has been handling these soft-story retrofits for property owners from the early days through today, for 30 dedicated years. Doing so has served Los Angeles & Orange County apartment owners and managers with the peace of mind that comes with working with a quality contractor, and the certainty that their tenants and properties are safe should another major earthquake happen at a moment’s notice.

Alpha Structural is licensed to both engineer and construct every job they take on that comes through their doors – they are a “one-stop” shop, meaning the entire project is taken care of under one roof by in-house engineers, draftsmen, permit expeditors and then project supervisors and crews. This is a much-preferred method according to Alpha Structural’s clients, where the alternative is separate engineering firms and contractors which can add time and money when there are questions once construction starts. With everything under one roof, Alpha Structural delivers the perfect balance of customer service, technical expertise accompanied by decades of experience.

Today, Alpha Structural has grown from their small beginnings in the Mount Washington hills to being considered the trusted leader in structural engineering and construction serving Los Angeles and Orange County. They are proud to be an award-winning design/build firm, with honorable mentions such as the Inc. 5,000 Fastest Growing Company award multiple years in a row, a Los Angeles Business Journal “Fastest Growing Private Companies” award winner, as well as a winner of the “Best Contractor to Work for in Construction” award in 2021. Additionally, they have received countless recognitions from the Mayors of the cities they work in, such as Los Angeles, Pasadena, Rolling Hills Estates, South Pasadena, Santa Ana, Fullerton, Irvine, Yorba Linda, and more. They were honored as well with a recognition from the California State Assembly District 51 for their dedication to safeguarding the community through their work.

If you ask Dave, the key to Alpha Structural’s continued success is their motto of quality first. They strive to deliver more to their clients than they expect on every job and will continue that for the next 30 years to come.

Founded in 1992 by Owner and Chief Executive Officer Dave Tourjé, Alpha Structural Inc., got its start in the hills of Mount Washington, in the heart of Northeast Los Angeles.  Today, Alpha Structural, Inc. is the leading structural engineering and construction firm based in Los Angeles and recently announced and celebrated its 30^th year in business serving homeowners and commercial property owners alike in both Los Angeles and Orange County.

By Dwight Kay, Founder and CEO of Kay Properties

If you’ve picked up a financial

By Dwight Kay, Founder and CEO of Kay Properties

If you’ve picked up a financial publication recently, chances are you’ve seen references to 1031 Exchanges. A 1031 exchange is a legal way for investors to defer their capital gains taxes on the sale of real estate held for investment or business purposes. It allows one to defer taxes on a property sale as long as they follow specific 1031 rules and guidelines. In other words, you have the potential to keep all your profits working for you with the purchase of your next investment property, without the IRS coming after you looking for their share of the pie. Here are five things to remember before a 1031 exchange.

1. Taxes are Applicable in a Non-1031 Exchange

When an investor sells a property that has gone up in value this results in several types of taxes. These include capital gains taxes, which the investor must pay if they sell the asset at a price higher than they initially paid for it. Federal capital gains are taxed at 15-20% of the increase in value, while state capital gains are taxed between 0- 13.3% of the increase in value.

Depreciation recapture taxes are taxes due when the seller had claimed depreciation expenses on the sold property. Depreciation recapture is currently taxed at 25% of the amount you have depreciated over the years. Other taxes incurred on property sales include the 3.8% Medicare surtax.

The beauty of a 1031 Exchange is that you can defer all of these taxes. But if you choose to sell your property without a 1031 exchange, ensure you consult a reputable attorney and CPA so you can know what your full tax bill will be when adding up federal capital gains, state capital gains, depreciation recapture and the medicare surtax.

2. You Need a Qualified Intermediary

A 1031 exchange isn’t as simple as selling and reinvesting in another property. You must first transfer the relinquished property to an intermediary or an accommodator so they can execute the sale on your behalf. This is a process whereby your sale contract is assigned to the qualified intermediary and when the property closes your funds are then wired to your account at the qualified intermediary. From there you will instruct which properties you would like the qualified intermediary to purchase on your behalf. Kay Properties is not a qualified intermediary however we work with many throughout the country so if you would like a referral please let us know.

3. You Can Only Purchase a Like-Kind Asset

For you to defer taxes via a 1031 exchange, you must reinvest the profits from the sale in like-kind property. In other words, if you sell a property held for investment or business purposes in a 1031 exchange, the replacement property must be of the same character. For example, you could sell an apartment building and purchase a commercial building or you could sell a rental home and purchase a DST 1031 investment.

4. Remember Deadlines

1031 exchanges are subject to strict deadlines. If you sell a property today, you’re expected to have identified the replacement property within the next 45 days and reinvested the proceeds within 180 days. But if you’d already identified the replacement property, you can reinvest immediately.

5. Understand Your 1031 Exchange Options

Once investors have decided to do a 1031 exchange they should consider their options.

First, they could purchase another type of investment property that they would manage on their own.

Second, they could purchase a triple net lease property whereby a national tenant such as Walgreens or FedEx has leased the property for typically 10-15 years. The problem with the triple net leased properties is that it causes investors to place a large portion of their net worth into a single property which could be disastrous (think Blockbuster Video).

Third, if the investor is wanting to get out of active management and the day to day issues of dealing with tenants, toilets and trash as well as they are wanting to diversify their investments into multiple properties then a DST 1031 exchange may be a solution. The DST (or Delaware Statutory Trust) is a type of property whereby the management is handled by a third party trustee and since the typical minimum investment of a 1031 DST offering is $100,000 investors are able to purchase a diversified portfolio of Delaware statutory trust properties that may include a piece of Walgreens for 100k, piece of a FedEx distribution warehouse for 100k and a piece of a 800 unit portfolio of multifamily properties located throughout the south east and Texas*.

If you are interested in learning more about your 1031 exchange options please get in touch with us today to learn more.

To learn more about Kay Properties please visit: www.kpi1031.com

About Kay Properties and Investments, LLC:

This material does not constitute an offer to sell nor a solicitation of an offer to buy any security. Such offers can be made only by the confidential Private Placement Memorandum (the “Memorandum”). Please read the entire Memorandum paying special attention to the risk section prior investing. This email contains information that has been obtained from sources believed to be reliable. There are material risks associated with investing in real estate, Delaware Statutory Trust (DST) properties and real estate securities including illiquidity, tenant vacancies, general market conditions and competition, lack of operating history, interest rate risks, the risk of new supply coming to market and softening rental rates, general risks of owning/operating commercial and multifamily properties, short term leases associated with multifamily properties, financing risks, potential adverse tax consequences, general economic risks, development risks and long hold periods. There is a risk of loss of the entire investment principal. Past performance is not a guarantee of future results. Potential cash flow, potential returns and potential appreciation are not guaranteed. For an investor to qualify for any type of investment, there are both financial requirements and suitability requirements that must match specific objectives, goals and risk tolerances.. Securities offered through FNEX Capital , member FINRA, SIPC.

By David Crown, Los Angeles Property Management Group

If you’re a property manager, even

By David Crown, Los Angeles Property Management Group

If you’re a property manager, even one who’s built a large business and assigned out many on-the-ground operations, let this article serve as a reminder that property management shouldn’t become just an “office” job, and you’re never too important to physically walk your clients’ properties. And if you’re an owner, don’t settle for a company whose top brass never leaves their cozy offices.  In fact, you might want to ask a prospective manager tactfully, “What did you notice the last time you were out in the field.”

Having devoted my professional life to building a property management business, I remember the pivotal turning points, the clients whose acquisition elevated our company to the next level and brought us closer to achieving our vision. One of those clients was an apartment owner who we’ll call Lydia in this article. Lydia chose to move away from her old manager and into our service ten years ago for a specific reason: she told me when we first spoke, “I don’t even remember when the head of my current management company last went to my property.” Keep in mind, this was a sizeable account, hundreds of units, the kind that even bigger companies would prefer to hold onto. Everything changed when I told her that I would personally walk her property on a regular basis. I’ve held true to my word, and she’s still with us.

For owners, the importance of this subject rests in your manager knowing the details of your property up to the minute. You should be able to ask the property supervisor assigned to your property for details about the last vacancy filled there, and receive a prompt, in-depth answer. They should be able to tell you about all of the important repairs performed there in the last month, and what the building needs next. And if the supervisor ought to know all of this information, surely the head of your management company should know some of it as well.

For managers, don’t get me wrong, delegation is your friend. Don’t misconstrue this to be a proclamation that no property manager should allow himself or herself to hand off any work to anybody else. I’m not advocating that you drive yourself insane by spending all week visiting every property in your portfolio. But, even if your rent roll grows and you can only make the trek once every six months or so, you should never entirely wash your hands of property rounds, not only because owners will appreciate knowing that their property is worth your time, but because there will always be something to learn from these trips. They will keep you knowledgeable about the properties you manage, and also show your employees that you care enough about their work to confirm that it’s being done right.

When I walk a property, I’m looking for anything that needs attention. The things that do are usually plain to see and doing so with the property supervisor assigned to the building allows me to see their work alongside them, as well as saving me the time of having to communicate necessary improvements to them.

As a lifelong fan of music, I recommend thinking about property management the way musicians think about their instruments: the greatest players are the ones who never stop practicing, no matter how much they’ve achieved. Take the example of Flea, legendary bassist of the Red Hot Chili Peppers. He attributes his success (and the opportunities he’s had to play with jazz greats like Ornette Coleman) to the fact that he practices for forty-five minutes every morning at home and spends an hour playing scales before every show on tour. The way I see it, if we don’t practice our scales, we can’t play our solos. In property management terms, that translates to: if we don’t honor the clients we manage for (by walking their properties ourselves), we won’t satisfy them enough to keep them and continue growing our business. If you do walk properties, you might just double your business overnight like I did when Lydia signed on with us. If you don’t, you might learn this lesson the hard way, as her prior management company did. Don’t just talk the talk; walk the walk as well.

David Crown is the Chief Executive Officer of Los Angeles Property Management Group and has more than 25-years of experience managing all types of income properties. He is a hands-on leader who has managed properties in 16 different states.  For more information, Mr. Crown can be reached directly at (323) 433-5254.

By Ari Chazanas, Lotus West Properties

As with many industries and businesses, the pandemic has proven incredibly difficult for landlords and property managers who make their income from rent payments. But as tenants have been unable to pay, landlords have been forced to dip into their savings and other “rainy day” emergency resources to survive.

I’ve shared my insights on the difficulties that landlords and property managers would encounter because of the city and state mandates. Beyond the impact on property owners’ finances, the buildings they own have suffered because there’s little money left over for making necessary repairs and renovations. These reductions in expenses extended to staff layoffs and deferments on mortgage payments and other financial responsibilities. Additional fees were incurred on late payments for expenses such as utilities and insurance premiums.

Despite many eviction moratoriums being lifted and state restrictions expiring, eviction bans and rent deferral programs remain in the City of Los Angeles and Los Angeles County. Moreover, the federal aid programs put in place to help tenants and landlords with financial hardship have been overwhelmed with requests, resulting in extreme backlogs. So, payments to landlords aren’t being made in a timely manner.

The Evictions Bans and Moratoriums Still in Effect

As the COVID pandemic evolved, bans on evictions due to unpaid rent were put in place. Anyone who lost their job, had their hours reduced or incurred an increase in medical bills or childcare related to the pandemic was protected under the order. Today, these policies remain in effect, with the City of Los Angeles having no plans to lift them until the declared COVID emergency period is ended by the City Council. It’s unclear when that will ever happen.

Once current bans are lifted, though, there will still be restrictions. Landlords may only evict a tenant who fails to make rent payments in the months after the emergency period ends. Any missed rent payments within that period can’t be penalized. Under the city’s ordinance, for example, the tenant will have one year from the time the emergency period ends to make good on the debt that is owed.

Since October 1, 2021, portions of eviction ban in Los Angeles County (other than the City of Los Angeles) was lifted. But landlords are limited in their capabilities to initiate eviction proceedings against tenants who moved into the property prior to that date.  A tenant who had submitted an application for rent relief through the Housing Is Key program was immune from legal evictions until July 1, 2022.  However, a landlord can’t begin an eviction against any tenant who has failed to make rent payments prior to April 1, 2022, unless the landlord had submitted an application for rent relief. This is one result of the extreme backlog of applications being reviewed with the Housing Is Key program.

Four Options That Landlords May Consider Now

For landlords and property owners in Los Angeles who are struggling, it can seem like there are very few options available to help you get back on your feet. The Housing Is Key program was intended to give everyone a financial boost, but with the backlog of applications and the inability to submit new applications, landlords are looking for some actual relief. They should consider these four options.

1. Explore Some Unique Eviction Options

For landlords who own property outside of the city boundaries, evictions may now be initiated against a tenant for unpaid rent, bearing in mind the set of criteria that must be met. The landlord can evict if an application for rent relief was denied for the unit in question; if the landlord applied for rent relief but the tenant failed to do so; or if the tenant moved in, on or after October 1, 2021. However, this law doesn’t preempt any ban on evictions due to Covid from the dates of July 1 to December 31, 2022.

2. Consider if There’s a Basis for Legal Recourse

Some landlords have found alternate recourse in suing a tenant for the rent owed, even if that tenant is protected by an eviction ban. Of course, there are restrictions and limits to this alternative for both the tenant and the landlord. Don’t expect to get the rent owed during the COVID emergency period until the rent deferral period expires—which could be some time next year.

California has started allowing landlords to sue in small claims court and lifted the restrictions on the size of the claim brought for hearing. This is an option for landlords who own relatively few or small properties and rely on rent payments to survive. It’s important to keep in mind, though, that landlords are unable to charge interest or add late fees to the monies owed by tenants unable to make payments due to Covid from the period of March 1, 2020, to September 30, 2021.

3. Monitor the Evolving Status of the Bans and Moratoriums

The changes in which restrictions are being lifted or remaining in place are often happening without much advance notice. So, it’s vital to keep checking with your local representatives, health departments and courts. Find out when these changes do occur so you can take the necessary action when allowed. Landlords and property owners who stay vigilant and attentive to the latest updates in the laws can act quickly.  Maintaining membership in an organization such as the Apartment Association of Greater Los Angeles will prove to be a valuable resource when it comes to staying updated on ever evolving regulations.

4. Keep Communicating Openly With Tenants

As always, the best course of action for property owners and landlords is to maintain an open line of communication with tenants. When landlords are upfront and honest with tenants, they’ll have the same courtesy toward you. When working together, solutions are often much easier to reach. Tenants typically want to be responsible and pay what is owed, and a good landlord is firm but understanding about back rent being paid and future payments being on time.

It may still be a difficult time for landlords and property managers to maintain their livelihoods as eviction bans and moratoriums persist. However, they’re not powerless. Pursuing any of these options can help them keep the lights on—for themselves and for their tenants.

Ari Chazanas is the Founder and Chief Executive Officer of Lotus West Properties, a boutique property management firm based in West Los Angeles.  You can reach them at (323) 487-2650 or via email at info@lotusproperties.com.  Mr. Chazanas serves as a member of the Board of Directors of the Apartment Association of Greater Los Angeles.

By Nicole Seidner

The internet delivered another of its famous surprises this month when

By Nicole Seidner

The internet delivered another of its famous surprises this month when one Australian comedian and renter decided to ‘clap back.’ Tom Cashman applied for an apartment and was approved, however, when he asked the real estate agent for the landlord to give him a reference from the previous tenant, that’s where things got dicey. There may be a new trend of applicants asking landlords for references coming around the corner, and heads up: there’s absolutely a right way and a wrong way to handle it.

References as a Standard

People ask for references all the time. Employers ask for them, landlords ask for them, and in a viral video with 2.4 million views, Tom Cashman asked for this as well. After being approved for the apartment, he asked the agent for something he hadn’t ever done before.  “Would the owner provide a landlord reference from a previous tenant?”  He stated in an email.  Tom Cashman continued in the video that it “it occurred to him he’d never done it before,” and encouraged viewers to start doing the same. With 330.4K likes and 2,185 comments at the time of writing, most of his viewers agree.  “They asked me for three references to see if I’m a good guy,” Cashman pointed out. “What about them? Are you a good guy? Are you going to fix stuff? Are you going to reply to my e-mails?”

Unexpected Response

It’s not entirely unsurprising that renters flocked to someone venting on their side. As the world starts turning more towards the renter side of thing, more want a place to get their feelings out, and when one person shows a way to do it, they all come flocking to the table. It makes sense. It’s also natural that when he made a Part 2, it got the same, though slightly larger, response. The Update received 2.6 million views, 460.5K likes and 8039 comments and as a landlord, some clues on what not to do when someone asks for a reference from a previous tenant.

At first, his request for a reference was ignored. After following up, the real estate agent asked to clarify. Cashman did. The landlord was not in contact with previous tenants. Cashman asked, does he not have their emails?  Small requests via email should not be ignored, and it should not be implied that you do not have your tenants’ and previous tenants’ contact information. If you have a moment, then Search your inbox for an email address and say, “sorry, this is new to me, but if you give me some time, I’m sure I can get that for you.” This will get you much farther with an applicant, and they will appreciate the open honesty.

The agent said the landlord didn’t want to contact them and Cashman’s application was immediately terminated under the implication that it was Cashman’s decision, which it was not. Cashman asked the agent why, when he didn’t ask for his application to be withdrawn.  Terminating an application at the renter’s request should only be done with explicit and written consent. It’s the landlord’s right to terminate any application, but this should be done with caution and tact, considering how it may impact your reputation or worse – lead to legal challenges.

The real estate agent explained that it had to do with a leasing period, which wasn’t an issue when Cashman first applied. Cashman encouraged his audience to ask for references, but to not “be cheeky” about it, like he was. That being said, what happened to Cashman is the wrong way to go about things. Even if it was the first time someone asked for references, being honest is a better route.

Unexpected Response

Cashman isn’t the only one who recommends that tenants ask landlords for recommendations. New start-ups like Whose Your Landlord and OpenIgloo show that renters are getting bolder now and are more willing to speak their minds. These may be warning signs of the turning tide: landlord references could be the new normal.

On the bright side, this does mean you have more room on the internet for positive reviews if places like these websites start to grow. Plus, if you keep handy a small collection of written references from previous tenants, you can begin new relationships with applicants on a positive ground right out the gate. When you start out with a good relationship, the chances that you’ll have smooth sailing with the tenant are so much higher. Now is as good a time as any to consider asking for a review, and maybe just keep it around, rather than deleting an application, should someone by chance request a reference.

Nicole Seidner is a copywriter at ApplyConnect, an affiliate of Contemporary Information Corporation (CIC).  She holds a degree in Writing from Savannah College of Art and Design with a focus in creative nonfiction. Her free time is spent taking pictures of her dogs or reading deep-dive analysis on movies that she hasn’t seen.  This article has been contributed by CIC.  CIC and ApplyConnect are the preferred tenant screening service providers of the Apartment Association of Greater Los Angeles.  For more information, go to https://aagla.org/cic-apply-connect.

Licensure is an complicated issue in property management and real estate. Requirements change from state

Licensure is an complicated issue in property management and real estate. Requirements change from state to state, and reciprocity laws make multi-state management even trickier. Regardless of where you live, it never hurts to get a real estate license and property management license (even if your state doesn’t require one or the other). A real estate license for property management enhances your resume, expands your knowledge of the industry and increases your earning potential.

First, this article covers the benefits of a real estate license for property managers. Then we’ll look at licensing requirements and reciprocity laws in each state.

1. Enhance your resume

Education looks good on a resume. In a competitive job market (or any job market), you want to be able to show your future owner(s) that you’re the most qualified for the job. You understand industry terminology, sales techniques, applicable laws and regulations, etc.

A real estate license for property management isn’t that difficult to obtain, but it does take a bit of time and dedication. In California, a state that requires licensure, you’re looking at about 15-16 weeks to complete a semester of coursework. Plan for about three hours of work per week.

2. Expand your knowledge of real estate & property management

In most states, a real estate broker license or property management license is required before you manage properties. But even in states where licensure is optional, extra education is never a bad thing. These certificates aren’t just pieces of paper with your name on them. That part is just for the state. The actual reason you attend is to expand your knowledge of the industry.

The more you know, the better equipped you are to deal with complex housing regulations, taxes and processes for buying, selling and renting. In short, you’ll get a better understanding of rental business processes.

Related read:A real estate license might be required, but what about a college degree?

3. Gain potential for additional income

With a real estate broker license, you’re free to buy and sell real estate in your spare time. It’s a great part-time job because it can take up as little or as much of your time as you like. Even doing a few deals a year can be a healthy bonus to your property management salary.

4. Command higher wages in property management

Professional certification makes you more marketable to employers. A real estate broker license gives you negotiating power because property owners will benefit from your skillset. If you’re lucky, your employer may even offer to pay for certification. (It’s up to you whether you feel comfortable asking them to pay for it.)

Should you collect all three real estate certificates?

There are three ways to get certified in real estate:

Real estate license & property management license requirements by state

Obtaining licensure is easier in some states than others. A few states allow you to manage properties with neither a real estate license nor a property management license:

Others require only a property management license:

All states not listed above require a real estate license. If you live in any of those states and want to be a property manager, there isn’t much of a choice. You need to be licensed.

Know the reciprocity laws in your state

Reciprocity laws exist in some states to allow out-of-state real estate agents and property managers to work in both locations. These laws vary greatly by state, and each state falls into one of three categories.

There are only five states that offer full reciprocity:

There are 17 states that offer no reciprocal real estate license agreements:

All other states offer partial reciprocity. Generally speaking, that means they have reciprocal agreements with some states and not others.

Real estate laws can be tricky, but they’re navigable with the right information. Hopefully, this guide helped you begin to understand whether you need a real estate license for your future in property management.

Disclaimer

This article was prepared for general information purposes only, does not constitute legal advice, must not be acted upon as such and is subject to change without notice. Always consult a lawyer or qualified housing expert for legal advice regarding your practice.

We take a close look at Ellis Act evictions and local ordinances that protect the rights

By

We take a close look at Ellis Act evictions and local ordinances that protect the rights

By Daniel Bornstein, Esq.

The 1980s law has always been anathema to tenants’ rights activists who have repeatedly tried to meddle with it.

The Ellis Act is a state law that allows landlords to evict residential tenants in order to go out of the rental business. This right is afforded to rental housing providers even though general public policy is to keep residents housed so long as their tenancy is in good standing. While local governments have a desire to compel landlords to continue to provide rental housing, the Ellis Act puts this impulse in check.

Yet the rights of owners to withdraw their property from the rental market are not unbridled. Local governments still have the ability to implement the Ellis Act and place various restrictions on how landlords exercise these rights.

First, it’s instructive to get some background from a time when the original Apple Macintosh PC went on sale for $2,500 after an iconic, Orwellian-themed “1984” Super Bowl ad was played. We were watching “Ghostbusters” in the theater, Prince owned the summer with the hit of “Purple Rain,” and when we ate burgers, we were wondering, “where’s the beef?”

It was also the year when the seminal case Nash v. City of Santa Monica was aired out in court.

The mother of a 17-year-old student purchased her son a $260,000 apartment building in Santa Monica but it wasn’t long before the young landlord became fed up with operating rental housing. His stated goal was to “evict the group of ingrates inhabiting my units, tear down the building, and hold on to the land until I can sell it at a price which will not mean a ruinous loss on my investment.”

The rent control board didn’t like this business model and refused to issue requisite permits. That’s because a landlord could only obtain a permit to remove rental units from the housing market by showing that rental use would not earn a “fair return” on investment, the removal would not displace low or moderate-income persons, and the removal would not affect the city’s supply of housing. Litigation ensued.

The trial court took a hard look at Santa Monica’s City Charter Section 1803, Subdivision (t) – which prohibits the removal of rental units from the housing market by conversion or demolition without a permit from the Santa Monica Rent Control Board – as it applies to prevent the owner of an apartment building from evicting his or her tenants and tearing the building down.

It held that these rules constituted a deprivation of property without due process of law in violation of the Fourteenth Amendment of the United States Constitution and Article I, Section 7, subdivision (a) of the California Constitution.

California’s left-leaning Supreme Court disagreed with the lower court’s ruling and upheld Santa Monica’s regulatory regime.

But this victory for city legislatures was short-lived, as California’s legislature was quick to respond. 

State lawmakers were incensed by the high court’s ruling that rental property owners can be forced to stay in business because of the fiat of local governments.

As a bit of nostalgia, there were more moderate lawmakers in that era. In today’s day and age when political rhetoric and sympathies fall squarely on the side of tenants, it would be impossible for such a piece of legislation to pass.

Named after James “Jim” L. Ellis out of San Diego, the Ellis Act provides that no statute, ordinance, regulation, or administrative action “shall . . . compel the owner of any residential real property to offer, or to continue to offer, accommodations in the property for rent or lease.” (Gov. Code, § 7060, subd. (a).)

What lawmakers can giveth, they can taketh away. 

Much like efforts to repeal Costa-Hawkins (the state law that promises landlords market rents in certain circumstances of “decontrol”), the Ellis Act has been continuously under attack since its passage in 1985, but cooler minds have prevailed.

In recent memory, for instance, a San Francisco ordinance enacted in December 2013 required that before tearing down a building or exiting the rental business, property owners must wait 10 years before rebuilding or renovating any of the formerly rented units. The First District Court of Appeal struck down the law, with Justice Marla Miller noting that the restriction “penalizes property owners who leave the rental market,” a right afforded under the law.

Undeterred, there were several iterations floated in the statehouse. Closest in the rearview mirror was AB 854, dubbed the “Stay in Business Forever Act.” It would have prohibited rental housing providers from availing the Ellis Act to transition tenants out and exit the rental business until such time when all owners of the property have held their ownership interest for at least five years. Further, it would have banned an owner from using the Ellis Act if the owner later buys a property within 10 years of filing a notice of intent to withdraw the property from the market.

It didn’t stop there. In the interest of transparency, AB 854 would have required owners to identify all parties with an ownership stake in the property whenever the owner planned to withdraw accommodations from the market.

The measure lacked the votes needed to advance to the Senate and so the bill died in 2022.

Rest assured,  however, that the campaign for AB 854 galvanized activists around the state and garnered a large collection of endorsements. There is no reason to believe that attempts at Ellis reform will end.

How prevalent is the Ellis Act?

Daniel Bornstein says these types of evictions are atypical and usually arise when the owner doesn’t have many other options and the status quo is not acceptable. The numbers bear this out.

The San Francisco Examiner reported this year that “the number of Ellis Act evictions was on a downward trend even before the pandemic.” According to San Francisco Rent Board data, there were 154 Ellis Act evictions in the city in 2015. Fast forward to 2020, only 73. A far cry from some reports that the Ellis Act is a main driver of evictions and will lead to a tsunami of displacements. The math just doesn’t add up in a city with so many thousands of rental units.

Despite the relatively low number of transitions out of rental units due to the Ellis Act, any lone instance can lead to boisterous protests.

Mom and pop landlords rely on the law as an escape hatch when they are losing money

A favorite argument used by proponents of Ellis reform has been that more regulation would deter speculators from buying rent-controlled properties and displacing tenants.

Had attempts to reform the Act come to fruition, it would have tied all rental housing providers, including mom-and-pops, to money-losing ventures.

Tragically, a countless number of small landlords have hemorrhaged money during the pandemic and for many, the bleeding hasn’t stopped. That is especially so in Alameda County, where barring tenant conduct that presents a threat to public health or safety, or the building is being “red tagged” and deemed unsafe for occupancy, going out of business is the only way to stop losing money.

The Ellis Act does not displace vulnerable tenants as easily as one thinks

Another narrative being articulated by tenants’ advocates is that vulnerable tenants are being displaced and risk homelessness because of the Ellis Act. It’s as if owners are throwing Grandma out on the street themselves.

In fact, these types of evictions are highly regulated with many safeguards in place that demand landlords give ample notice and hefty relocation payments.

Some of our thoughts from 40,000 feet

Calling it quits and going out of the rental business is a weighty decision that should not be taken lightly. It’s the last resort.

Sadly, for some landlords bereft of rental income and with few other theories to evict, the Ellis Act may be a viable option. Our office is happy to dialogue on what the best course of action may be.

Keep in mind that choosing to use the Ellis Act is an option that can be lengthy and costly with attorneys’ fees. Also, cities may place restrictions on the future use of buildings that have been “Ellised.” So, we call this the “nuclear” option.

With all of this in mind, our strong preference is to engage the tenant in a discussion whereby he or she voluntarily vacates the premises in exchange for compensation, a rent waiver, a return of the security deposit, or any mixture of incentives to leave at their own volition with a complete waiver of claims, but let’s continue our train of thought on Ellis Acts.

What if a tenant does not vacate when the owner has followed all protocols when withdrawing all housing accommodations? 

Once all of the I’s are dotted and the T’s are crossed, it is likely that the tenant will vacate because they do not want a blemish on their credit or any notation of an eviction history. For any tenants adamant about staying, an unlawful detainer can be filed, and the matter is almost done. Or is it? The tenant unlawfully occupying the premises can assert any number of things, aided, of course, by free legal representation. For instance, San Francisco’s Proposition F in 2018 provides funding for free, full-scope eviction defense for residential tenants.

Defenses to an Ellis Act Eviction

The first and most compelling defense is that the property owner did not comply with local requirements and exactly adhere to prescribed filings with the Rent Board. Notices must be airtight and indeed, even if one word is missing, the action can be tanked.

While many landlords are accustomed to serving standard 3-day notices for failure to pay rent, tenants being transitioned out by way of the Ellis Act must be given at least 120 days’ notice, and certain other groups of tenants (disabled or elderly) are entitled to even lengthier notice of a full year.

The reams of paperwork and perilous notices attendant to an Ellis Act eviction will typically need to be handled by an attorney.

Cherry-picking: Generally, a landlord cannot do a “partial” eviction. All residential tenants in the building must be given eviction notices simultaneously and not just select tenants.

Waiver of notice: It is a cardinal sin for a landlord to accept money after the tenancy is terminated; this re-establishes the tenancy. It is also important not to change the terms of the tenancy – leave the terms as is to avoid arguments that you’re trying to “wind down the tenancy” and force the tenant out through unlawful means.

The eviction is retaliatory: While this is a common defense in other types of eviction actions, claims that an Ellis Act eviction was commenced out of retaliation may not be so persuasive. After all, it’s not personal to the particular tenant where the owner is not re-renting the unit. In Drouet v. Superior Court, the California supreme court ruled that “a landlord’s bona fide intent to withdraw the property from the rental market under the Ellis Act will defeat the statutory defense of retaliatory eviction.”

Relocation payments

Ellis Act evictions will come with a price in the form of payouts to outgoing tenants. In San Francisco, there is “head counting.” That is, payouts are dispersed to every member of the household. Oakland relocation payments, on the other hand, are based on unit size. In Berkeley, requisite relocation payments are doled out to “households.”

However, we are not done yet; additional payments are required for certain groups of tenants considered to be vulnerable. These may include seniors, disabled persons, households with minor children, long-term tenants, and residents with low income.

Relocation payments keep going North

These farewell payments for no-fault evictions are already in the stratosphere, but they are continually reset on an annual basis and they go up – they don’t go down.

One interesting question for any crusading litigators out there is at what point do relocation payments become so high that it infringes on the rights of property owners?

A San Francisco ordinance passed in 2019 said that even if a property is not subject to rent control, a massive rent increase is considered tenant harassment, and if tenants are unable to pay the increased rent amount and are forced to move elsewhere, it amounts to a constructive eviction. After landlord groups challenged the ordinance, the law was upheld in the courts.

It seems to us that the cloth cuts both ways. If exorbitant rent increases are considered to be “bad faith,” what about exorbitant relocation payments? How high do relocation payments have to reach before these mandated payments rise to the level of bad faith to the point that the government has made it impossible for property owners to recover possession of their property? Starting in September, for instance, San Francisco increased relocation payments for the Ellis Act – and only the Ellis Act – by several thousand dollars per tenant, as compared to other non-fault evictions. Perhaps they will reach a level that invites a lawsuit by landlords. Food for thought.

Some questions remain in Berkeley in light of its eviction moratorium

Berkeley, of course, is in Alameda County. The County’s eviction moratorium remains in place, but there is an exception carved out when the landlord takes the rental unit off of the market.

The City of Berkeley, however, is silent on this exception. At one point, it listed the Ellis Act as a permissible reason to evict as long as emergency orders remained in place. Yet some Berkeley lawmakers examined moratoria elsewhere and found that Southern California locales like Los Angeles did not include an exception for the owner’s desire to remove units from the rental market as a permissible reason to evict under a draconian ban.

Under state law, Berkeley property owners can evict tenants to remove units from the rental housing market but must follow Berkeley’s Ellis Implementation Ordinance to do so. This establishes specific procedures under the state law for owners attempting to withdraw property from the rental market but will, however, take a bit of legal maneuvering. Owners are strongly urged to seek legal advice.

What about other buildings not subject to more restrictive local rules? The Tenant Protection Act of 2019 (AB 1482) applies

If a property falls outside a jurisdiction that has its own “just cause for eviction” regulations, statewide rent and eviction controls kick in. And these are much more simplified.

The landlord merely serves a regular 60-day notice terminating the tenancy. Owners need only provide a payment equal to one month’s rent, or a written waiver of the last month’s rent. It makes for easier bookkeeping to waive last month’s rent than it is to write out a check to the tenant.

We hasten to say that questions remain about how to go out of the rental business by way of AB 1482. This provision of the law was eclipsed by COVID-related eviction protections and so there is not much precedent to rely on.

For example, for how long must the owner keep units off of the rental market? AB 1482 does not specify a time certain. Under the Ellis Act, rental units cannot be re-rented for five years. If landlords avail AB 1482 to go out of business and then prematurely re-rent the properties they purportedly just took off the market, this strikes as bad faith and can invite a costly lawsuit. Be careful with timelines.

Another gaping question: does the landlord have to withdraw all of the rental units, or can certain units be isolated for withdrawal? 

Let’s use a hypothetical in, say, San Francisco and Berkeley. If there is a 15-unit building and the owner endeavors to remove rental units from the market, all 15 would have to be on the chopping block; the owner would not be allowed to “cherry pick.” But if the units are only covered by statewide eviction controls, it remains to be seen whether the landlord can be selective in their removal.

It seems to us, as well, that under AB 1482, there are objections tenants or their attorneys can raise, so don’t be surprised if this provision of withdrawing rental units is put to the test. Unlike other areas of law where there are years, if not decades of legal precedent, AB 1482 went into effect in 2020, so there are several kinks that must be ironed out in the courts.

ABOUT DANIEL BORNSTEIN

More than a practitioner in landlord-tenant law, Daniel Bornstein is the Broker of Record for Bay Property Group, a property management company that protects and optimizes the investments of landlords. He is also renowned for his educational seminars and is called upon as an expert witness in complex real estate litigation matters. To avoid or resolve friction within rental units and cauterize risk, Daniel is happy to dispense informed advice to owners, property managers, and other real estate professionals looking to survive and thrive in today’s challenging and litigious rental housing market. Call 415-409-7611 or email daniel@bornstein.law.

Article Contributed by Arize

Smart technology is the blueprint for the future of multifamily

Article Contributed by Arize

Smart technology is the blueprint for the future of multifamily communities. You can visit luxury high-rises and see all the latest products that make life easier, but that technology is now finding its way into Class B and Class C properties too. As devices and software become more common place, more owners, operators, and residents are seeking out the latest property technology and its benefits as they look for more energy-saving solutions and security monitoring systems.

Technology companies are finding new revenue beyond just their most affluent customers, and investors and venture capital firms want to get involved. In 2021, venture-backed companies in the real estate and property technology sectors raised $21 billion from investors, according to Crunchbase data.

The need to house America’s workforce isn’t going away any time soon, and with the single-family housing market not exactly favoring the buyer due to the interest rate hike and soaring housing prices, rental units in multifamily properties are already seeing increased demand making the technology needed to manage these properties ripe for broader use across the industry.

Home has also become the new office for many professionals, so there has been less demand for commercial space. While many companies have re-evaluated their need for offices with a growing work-from-home employee pool, owners of Class B buildings are considering converting office space into multifamily housing due to the availability of these commercial spaces and the current demand for housing.

Closing the Divide Between Value-Add Options for Class B and Class C Properties

Property technology, or “PropTech,” is doing more than just making things more convenient. Many luxury, high rise buildings, apartment complexes, and now low-income housing units employ similar technology as a property management tool. These smart solutions allow owners to find cost-effective solutions to expensive problems such as energy consumption and costs, security monitoring, and utility costs. This also empowers Class B properties by giving renters what they are looking for, but at a better price. Being an early adopter is key to thriving in today’s Class B real estate market while staying competitive with Class A communities.

There are numerous examples of how value-added amenities have moved across the class divide. Take the washing machine, for example. Several decades ago, most residents didn’t have washing machines in their apartments. As time went by, property owners leveraged washing machines, which were increasing in popularity, as an offered amenity to attract new residents.  Smart technology is following this same trend. Property owners are realizing the importance that PropTech holds. The market has shifted from implementing smart technology solely to improve the resident experience to now being the cost of doing business to attract residents. It is now a need that builders and developers are factoring into their construction plans as smart property tech – once a luxury amenity – becomes a necessity to stay competitive in the market.

What Does the Landscape Look Like Now?

Driven by renters’ stoked demand for in-unit smart tech, and the enticing value of increased rent, multifamily communities are leaning into technology now more than ever before. Smart tech has made inroads in solving one-off problems that multifamily communities face.  This includes granting residents’ access to their units without having to manage hundreds of keys or controlling in-home temperature remotely with smart thermostats. These devices have made the lives of property managers easier.

The evolution of smart technology and its ecosystem platforms has arrived. Owners and operators, now have end-to-end smart tech ecosystems that are fully integrated with their property management platforms. Offering them turnkey solutions that streamline, automate and provide new streams of revenue.  Property owners are leveraging smart technology solutions for risk mitigation and asset protection. By using water leak detectors that alert managers the moment moisture is detected instead of hours later, managers minimize and even prevent costly property damage.

Additionally, motion sensors and alarms help beef up property-wide security. Alarms are effective in deterring break-in attempts and protecting residents and assets. These alarm sensors can also be placed in common areas, offices, hallways, and apartments.  Lastly, smart locks allow residents and owners to lock and unlock apartments using an app on their phone or through their web management platform. Smart locks also boast an auto-lock feature that ensures apartments remain safe and secure, even when an employee forgets to lock them up.  Smart apartment technology provides simple, smart and innovative solutions to common multifamily problems, and it seamlessly forms connections that enrich people’s lives.

What are the Benefits of Smart Tech?

Smart Tech drives net operating income (NOI).  Smart tech is a security measure and a loss prevention investment. However, it’s also an amenity that owners can offer to attract new residents (and retain the ones they already have). In fact, offering smart tech as an amenity can justify a rent increase of $40 to $50 per month per unit.

Increased Class and Commercial Conversion.  Amenities are one of the main considerations when it comes to a building’s class ranking. Smart tech alone won’t transform a building from Class B to Class A, but combined with other improvements, it can get the ball rolling.

Return on Investment (ROI).  PropTech brings relief to property managers when they realize they can implement it in a multifamily unit without having to knock down walls or rip out drywall. Compared to the cost of adding other amenities, smart tech is a bargain.  Class B properties offer residential living at a more affordable price point. Adopting smart tech early can position Class B property owners to compete with Class A properties.

Appealing to the Green Wave of Renters

In 2021, Gen-Z was the only generation who submitted more leasing applications than the previous year, especially when it came to multifamily properties. These renters are looking for apartments that include smart technology that won’t have a negative effect on the environment.  Smart thermostats are more eco-friendly. Lower energy consumption diminishes the demand for electricity produced by power plants, reducing carbon emissions that cause global warming. This, of course, appeals to environmentally-conscious renters.

Don’t Wait!  Join the Smart Tech Revolution

Smart technology adds an immense amount of value to property owners and the communities they manage. It offers solutions at a lower price point than what other amenities or services typically cost, and it is easy to implement, prevents damage, and generates consistent revenue.  Right now, smart tech upgrades offer residents an experience that meets and exceeds their expectations. Smart tech ecosystems, such as Arize, reliably enhance ROI, NOI, operational efficiencies, and resident retention and acquisition. These once “nice-to-have” upgrades are a necessity today, quickly becoming the cost of doing business and staying competitive in today’s multifamily market.

Arize is an all-inclusive platform that provides convenient, connected, and secure living for properties of all kinds.  From traditional apartment upgrades to new upscale luxury apartment builds, we help your community thrive effortlessly with cutting-edge technology.  For more information, go to www.arizehub.com. 

Information and tips from local fire alarm experts, Bay Alarm Company

Over the past two years, the

Information and tips from local fire alarm experts, Bay Alarm Company

Over the past two years, the City of San Diego has started enforcing new updates to its local fire code. These updates apply retroactively to certain buildings constructed before January 1, 1975. Some owners of multi-family buildings have received notices about how their buildings fall under this new code.

At Bay Alarm, we’re working with customers who received this notice to update their systems. Keep reading to learn if your building falls under the new code—and what to do if you receive a notification.

Not all multi-family buildings fall under this new code.

The affected structures were built before January 1, 1975, and meet the following criteria:

There are exceptions—so not every property owner that meets the above requirements will need to act. You can visit the City of San Diego’s development services website to learn more.

Fire code enforcement is because of concerns about occupant safety.

In the case of San Diego, the city amended the code, and the fire department is enforcing the new requirements to keep occupants safe. We know from experience that the best way to prevent injury is a fire alarm system with an early notification system.

In the Summer of 2021, one of Bay Alarm’s retroactive fire alarm systems saved the lives of an entire apartment complex. The low-frequency sounders in each living room and bedroom woke residents in the middle of the night so they could safely evacuate from an active fire.

Because local authorities enforce fire codes, the level of enforcement varies by city.

In California, the California Fire Code governs where and when a fire alarm system is installed. Then, NFPA 72®, the National Fire Alarm Code®, developed by the National Fire Protection Association® (NFPA), provides details on howto install the system.

The California Fire Code sets the minimum standard for every occupancy in California. However, enforcement falls to local governments, so the level of enforcement can vary significantly. In this case, the City of San Diego amended the California Fire Code to retroactively enforce the code on multiple-story buildings that existed before January 1, 1975.

Local fire departments usually handle local enforcement.

In many cities, including San Diego, the fire departments are the local Authority Having Jurisdiction (AHJ) that enforce fire codes.

According to the City of San Diego Fire-Rescue Department, owners must retrofit affected buildings with automatic or manually operated fire alarm systems that warn all occupants at the same time. And visual and audible notification is required throughout the building, per the current edition of the California Fire Code.

Receive a notice? Hire a professional fire alarm contractor to upgrade your fire alarm system.

If your building needs a new or updated fire alarm system, you’ll want to use someone familiar with state and local fire codes. A fire alarm provider should offer the following services:

You should also consider companies that offer fire alarm monitoring, a service where a team of agents monitors your fire alarm system 24/7, and who can contact emergency services in the event of a fire alarm activation.

Make sure your contractor has local knowledge and knows the local authorities.

Local experts are more likely to know how to get your building up to code and often have a close working relationship with the local AHJ. With a local fire alarm provider on your side, you can get in compliance, enjoy quick access to technical support, and schedule annual inspections to ensure the system works as it should.

Designing, permitting, and installing a compliant fire alarm system can be a lengthy project. However, the City of San Diego Fire-Rescue Department and other departments give adequate time for installing a new fire alarm system once work begins. In our experience, once an inspector sees that a professional fire alarm installer has initiated the permitting process, and a project number has been provided, they will sign off on the inspection. However, an implementation plan may be required.

Price shouldn’t be the only priority when selecting a company to install your fire alarm system.

The price of the project will depend on building size and occupancy type. However, because fire codes are standard across one jurisdiction, quotes are based on similar parts and labor, no matter the company.

Be wary of any company that offers bids notably lower than competitors. They may not fully understand the fire code and how to get your building in compliance. For example, the code does not specify how many sounders are required in a residential space. However, in our experience, there should be one sounder in each living room and bedroom to achieve the appropriate decibel rating. 

Bay Alarm is here to help San Diego multi-family property owners.

Want more information about retroactive fire codes in San Diego? Talk to a licensed C-10 fire alarm contractor that can design, permit, and install a fully compliant fire alarm system.

Alec Barton-Bareno

Enterprise Sales Representative

Bay Alarm Company                                                          

858-209-7859 | Alec.Barton@bayalarm.com

www.bayalarm.com

This business of rental housing can really make me crazy sometimes!  Often, it can be the seemingly “little”

This business of rental housing can really make me crazy sometimes!  Often, it can be the seemingly “little” things that just set me off.  When I get on one of my moods, just stand back everyone and let me be…but, I will and always do eventually calm down.  An occasional glass of a great wine often does that for me.

An E.V. Station in Every Pot

Recently, our state lobbyist updated me on the seemingly simple, nonchalant proposal in Sacramento known as Senate Bill 1482.  No, I am not talking about the late, great “Assembly Bill” 1482 which forced on all of us statewide rent control and tenant protections a couple of years back.  No, this is “Senate Bill” 1482 that would mandate that our building codes in California include requirements to install at least one electronic vehicle charging station at multifamily developments.  While this does not apply to existing multifamily properties, my guess is that outcome will be forthcoming in the future.

While seemingly harmless to most of us, albeit it merely adds to the cost of badly needed new housing development necessary to address our state’s housing shortage, it made me think about “what the heck are these politicians thinking with stuff like this.”  Sure, I get it.  Let’s encourage electric vehicles to save the environment despite today’s electricity primarily being generated by badly polluting coal and natural gas plants.  Right, this is the same natural gas, by the way, that cities like Los Angeles and Pasadena and others want outlawed and removed from our kitchen appliances, water heaters and space heaters only to be replaced with electric devices powered with electricity generated with coal and natural gas – “Houston,” do we have a problem here?!!

Anyway, I digress for a moment.  Don’t get me started on eliminating natural gas ovens so we can dine on subpar cooking – it just might be the end of Micheline Star restaurants here in California.  Am I to lose by backyard barbeque too?  And, the cost of converting?  Never mind…let’s get back to Senate Bill 1482.

In thinking about Senate Bill 1482, I realized these elected officials we “hire” do not understand the realities that exist outside of the Capitol building in Sacramento.  It is almost as if the sky is a different color where they live.  So, let’s talk about the real world the rest of us live in and the concept of requiring the installation of electric vehicle charging stations at multifamily properties.  The issues surrounding the concept of mandated E.V. charging stations applies to other crazy proposals by way of Sacramento that fortunately have come and gone, and that unfortunately for us in some cases, have stuck around.

I don’t know about you, but in the “real” world the most of us live in outside of the state capitol building, most parking areas at multifamily properties are open and not protected.  As a result, electric vehicle charging stations are just another thing that can be damaged by car or human being, tagged with graffiti, possibly broken into (electricity stolen) and run over to cause damage or even a fire.  As a result, these E.V. charging stations being mandated to protect our environment will become just another headache for housing providers and a “thing” that rental property owners will have to pay to maintain, have annually inspected, and fix and replace.  Another big nightmare if you ask me.  And, Sacramento ponders why rental housing costs continue rising?

The idea of forcing owners to provide an amenity that has nothing to do with habitability is just out of line…as usual from our “friends” up there in Sacramento, and our friends in local jurisdictions like Los Angeles, West Hollywood and Santa Monica, among most others.  It is practically like asking owners to provide a gasoline pump at their properties – why not!

“Moratoriumism” – Will the Tyranny Ever End?!!

The City of Los Angeles’s infinitely ongoing moratoriums are evictions and rent increase have existed now for more than two years.  More than two years!!!  We are well past the point when a person can say with a straight face that they continue to be adversely impacted by the coronavirus, and we are now at the point where we can say, “who hasn’t had COVID at this point?”  Yet, the saga at City Hall continues and also for all of Los Angeles County thanks to the Board of Supervisors who have extended their COVID protections through June 30, 2023, and who knows how much longer after that they will extend them.  It is a crazy, mixed-up world we are in today, folks.  Really!  Everything is so unbalanced and favors the renters at our properties who lack the one thing we possess, a deed of trust.  How is all this fair?!!

Our efforts in this realm, to push-back against these draconian regulations, continue.  We have tried our best advocacy efforts to convince the “politicos” on the Los Angeles City Council and County Board of Supervisors to put an end to “Moratoriumism” but to no avail so far.  As a result, we have resorted to much tougher methods than détente.  Today we have pending lawsuits against both the City of Los Angeles and Los Angeles County claiming violations of the constitution, which we believe these punitive moratoriums are.  Unfortunately, we cannot control the timing of hearings and pace of the court system, but I can assure you that once we prevail, we will seek compensatory damages against the City of Los Angeles, County of Los Angeles, and any other local jurisdiction that imposed one of these draconian ordinances.  And we will and must prevail here.

Advocacy Counts – Help Us!

I hear from members all the time suggesting we, meaning me and the limited staff that we have, make phone calls, create lawn signs, leave door hangers, etc., etc.  We do appreciate your suggestions always.  We do not claim to be experts, nor do we claim to have a “silver bullet” to prevail over every political or regulatory issue.  Nevertheless, the gist of what I think I am hearing from some of our members concerns launching some type of grass roots advocacy.  This, I believe, is quite a good suggestion and very valid (if that is I fact what some of you had suggested).  Unfortunately, “this” has been a major area of frustration for me because I have found it difficult to get property owners engaged in the constant fight we have undertaken.  Most often, our “Red Alerts” and calls to action go unnoticed and we, as an apartment association, are standing alone at public meetings or in making comments to the press.  Elected officials want to hear from the electors, not from an apartment association.  Therefore, please help us.  Let your story of how you have been personally wronged be told.

Ongoing Litigation – Please, Help Us!

I often hear from members who want us to file a lawsuit for a multitude of “wrongs” being perpetrated against them and the rest of us, and we do have 5 such lawsuits outstanding today with possibly others to follow.  However, and here’s my biggest bone of contention, when it comes to helping our efforts by giving us a story to tell about how one or more members have been harmed I most often get “crickets,” and even worse, when it comes to helping with the costs of litigation now more than $350,000 this past year, I get no response.  Not even an offer of one dollar let alone $100. 

So, that puts us in a predicament because we are left with limited resources in our fight against a wealthy, bloated government entity that can afford to spend millions of dollars on litigation as if that sum were a mere rounding error.  Nevertheless, we will continue fighting these battles until we ultimately prevail.  I can also assure you other organizations throughout the U.S. are fighting court battles on these same issues, and with the current make-up at the U.S. Supreme Court, we are hopeful that one or more of these cases will ultimately get a favorable ruling.

Commenting on Housing is Key

Almost daily, I speak to owners who have lost $100,000’s of dollars in rent at the hands of government action and “Moratoriumism.”  It is just not fair.  We rental property owners are not some huge, faceless corporations, and we are the ones being hurt here while in most cases I have come across, tenants who are merely “gaming” the system while we are being taken advantage of.  Isn’t it ironic (I am being facetious here…) that when the state of California announced the rental assistance program, “Housing is Key,” that even greater numbers of renters stopped paying their rent?  Just like unemployment fraud, I can guarantee that a great deal of rent relief funds went to those who did not qualify or did not deserve it, and as a result, some who did qualify or that were otherwise left out could have been helped.

Shot Themselves in the Foot!

Not long ago, I was contacted by Mayor Garcetti’s office looking for our help with housing law enforcement trainees.  The City of Los Angeles had hoped that after about two years of challenging rent collections, despite moratoriums on evictions and rent increases, and proposals to eliminate our screening procedures, that we would be able to help subsidize housing costs for law enforcement trainees and newly sworn officers.  Don’t get me wrong, I appreciate our men and women first responders who on a daily basis put their lives on the line to protect those of us in the community.

After hearing the pitch and how much I was going to have to ask our members to discount their rents, I asked the person from the mayor’s office to let the mayor know that the regulations imposed on landlords by the City are a huge impediment to participating in this proposed rent discount scheme (and in general, to accepting vouchers).  I expressed with great certainty that owners would love to accept help out with the discounted rent program, but there are too many risks involved today with the City’s moratoriums on evictions and rent increases, anti-tenant harassment ordinances, overzealous inspectors, proposed elimination of tenant screening, and so much more.

Our members had also been asked to take on the risk associated with housing thousands of Afghan refugees, and many had signed up until the County extended its moratorium on evictions until June 30, 2023 – so interest waned. 

It is ironic that the government treats people in the housing business like pariahs, but when they need us, they beg for our help.  What they are doing is putting us out of business.  Sorry to be so totally honest about the current regulatory situation, but the saying “shooting oneself in their own foot” comes into mind here with respect to the City of Los Angeles (and government in general).

Until next month’s diatribe!  Speak to you then…

Short-term rentals (STRs) that are facilitated by online platforms like Airbnb have been the subject of

Short-term rentals (STRs) that are facilitated by online platforms like Airbnb have been the subject of intense debate across the U.S.  Local governments around the globe, including several cities in the U.S., have responded quite differently towards regulating STRs. Most cities have not significantly regulated these platforms, but a limited number of cities have recently put severe restrictions in place.   

The truth of the matter is that opposition to multifamily home sharing runs smack up against powerful demographic trends and market demand. And while the pandemic has been an inflection point, change was already taking place in the multifamily sector. Studies indicate that this “living as a service” model has already proliferated multifamily properties nationwide, albeit “under the radar.”

In fact, research from NMHC found that 65% of all booked nights on Airbnb took place in multifamily buildings. Resistance to this trend has only led to more risky practices with less control and governance over the activity. Now, Migo by RealPage® is paving a new, right way forward by bringing to the sharing economy the tools and levers needed to streamline the home sharing process and make it safer for all involved. 

That said, the resistance to multifamily home sharing has affected the ability of multifamily property owners in New York, Boston, Chicago, Miami Beach, San Francisco and other major cities to offer home sharing as an amenity in their communities. For example, San Francisco imposes a 14% hotel tax (i.e.,  a Transient Occupancy Tax) and a cap of maximum 90 rental days per year. Other cities have banned “owner absent” rentals, which defeats the whole idea of home sharing for those who want a flexible living option.  

While all these facts represent strong support for home sharing, public policy needs to catch up. Licensing and regulatory schemes need to adjust to the new reality — that home sharing is on the rise, largely because Millennial and Gen Z renters are focused on a flexible lifestyle, fueled by a pandemic-induced shift to “work from anywhere.”  Licensing and regulation, therefore, need to be flexible — a quality not always associated with property laws.   

In 2019, Warton School of Business at University of Pennsylvania expressed the view that, “The sector will continue to grow, much more quickly than the traditional rental economy.” 

Further, they opined that employment will continue to change, and that, “Governments that look ahead and adapt to these developments will derive substantial benefits for their economies and their communities.”

Airbnb influence

From their inception in 2008, Airbnb has laid the foundation for the STR model,

which is now being applied to home sharing via the company’s partnership with Migo.  As the years have gone by, Airbnb has stepped up its ability to verify guest identity and perform background checks, and that has led to greater security in the STR process.

Moreover, Airbnb has gotten travelers comfortable with local hosts and home-sharing accommodations. And, by 2018, when the company was logging roughly 500,000 average stays per night, about 65% of those bookings were in multifamily buildings.

By mid-2020, Airbnb reported that the number of reviews mentioning “remote working” had tripled, and by the beginning of 2021, 24% of their stays were being booked for 28 days or longer.

Now, Airbnb has partnered with the gold standard in multifamily technology — RealPage — specifically to be more aligned and integrated with multifamily systems and practices. 

The changing employment landscape

In the pandemic-accelerated world of remote work, the “office” has become synonymous with “wherever I choose to work,” with Zoom, Slack, Teams and other cloud-based platforms providing virtual office connectivity and collaboration tools.

As a result, young career professionals are no longer encumbered by the need to reside within a commutable radius from their employers.

Changing renter preferences

The Millennial and Gen Z generations prefer to rent. Millennials “job hop,” so they savor flexibility, both in their career and where they live, which is why they are mobile. A recent survey revealed that 73% of Millennials said they would move in the next 10 years, and 33% say they’re delaying home ownership because they’re “not ready to settle into a more permanent lifestyle.” That’s why Millennials are more likely to rent and will keep doing so.  

Another reason why the Millennial and Gen Z generations prefer to rent is the high price of buying a home, which reduces their living options. In California, the third-largest state in America, the median price of a home in 2020 was $600,000 — nearly 88% higher than the national median.

In 2021, the median price for a home in California increased to $725,000. That hefty price tag has convinced Millennial and Gen Z renters that buying a home is, for the foreseeable future, beyond their financial reach. That’s why, in recent surveys, Millennial and Gen Z respondents have indicated that they will likely extend their renting period and delay homeownership.  

In fact, although the vast majority of Millennials want to own a home, 12.3% of them say they plan to “always rent.” And Gen Z renters view homeownership as being something that may never happen for them. As a result, there will be sustained demand for multifamily rentals going forward, especially those that offer flexible living options.

Warton has identified Millennials as one of the major proponents of this growing STR sector, citing that 7 in 10 Millennial business travelers want to stay in local-host rentals, not in hotels. Further, they quoted a survey by Expedia, which found that 62% of Millennials are willing to extend their travel after a business trip to experience local life. 

And Millennials are “the most sustainability-conscious generation.” In fact, sustainability is a key concern for this generation of renters. They are heavily influenced by such trends as the move to “sharing instead of consuming” through peer-to-peer economies. For multifamily owners, home sharing increases the sustainability of properties by keeping units occupied at often above-market rent rates. 

The changing multifamily landscape

New short-term rental analytics tools are equipping multifamily property owners and investors with real-time insights regarding the earnings potential of their properties as compared to the seasonally adjusted revenue of nearby rentals. For residents, home sharing offers not only flexible living but also the chance to offset rent by as much as 20%. Part of the profit goes to the property owner, so it’s a win-win all the way across the board.

And with the kind of transparency and control levers Migo brings to home sharing, the headaches of renter turnover are diminished, and short-term rental properties are quickly becoming one of the best performing aspects of an investor’s portfolio.

In addition, Migo enables multifamily owners and investors to use concurrent listings to adjust dynamically to market demand for STRs, ensuring that their properties are always listed at ideal prices and stay lengths. And by focusing a small portion of their less popular or more frequently vacant units in the STR niche, investors will quickly build a more diversified portfolio and will realize better margins with little to no cost of “entry.” 

Home sharing is becoming a worldwide norm

Considering underlying market factors, the demand for STRs is strong and seemingly here to stay. And the practice goes well beyond our national borders. Multifamily home sharing is becoming a worldwide norm, as “work from anywhere” affords workers the ability to travel and explore new places.

As Francis S. C. Yeoh, professorial fellow in entrepreneurship at the School of Computing, National University of Singapore, notes, “It’s a big wave – a tsunami – that’s coming, and you have to recognize, acknowledge and manage it. It is futile to try and fight.”  

Clearly, there is no better time for multifamily owners and investors to get in on this burgeoning flexible living trend and meet the future of multifamily real estate where it stands.

Contributed by the Team at LIVABLE

Billing residents for water and other utilities

Contributed by the Team at LIVABLE

Billing residents for water and other utilities has benefits! Property owners can offset their expenses while encouraging conservation. Here are some of the things you need to be aware of when it comes to billing your tenants for utilities.

Great news! If you’ve decided to start billing your tenants for their utility use, you’re not only making them financially accountable for their utility use, you’re also making them environmentally accountable.  Public concern about global warming exceeds 50% among most demographic subgroups of Americans, according to Gallup. People are growing increasingly concerned about the environment, and increasingly interested in ways that they can help. In a 2021 Mastercard survey, 85% of people said that they were willing to take personal action to combat environmental and sustainability challenges. Scaling back water and energy use is great for the environment, but it’s not easy to get people motivated to do that.

When residents are responsible for their utility bills, they tend to use utilities more responsibly. Billing your residents can provide them with the extra incentive that they need to conserve. There are a number of things that property owners and property managers need to be aware of ahead of time to ensure that the transition to billing goes smoothly. Keep reading for a quick overview.

Before You Choose Your Utility Billing System: Carefully Consider Your Options

You need to figure out which utility billing method works best for your multifamily property. Is retrofitting a submeter in each of your units the best move? At present, are you ready for that financial expense? How easy will it be to coordinate installations with your current tenants? Maybe you want to make use of your property’s master meter and are considering a ratio utility billing system (RUBS). This way, you skip the installation process and all its accompanying headaches and instead use a utility allocation formula that’s fine-tuned to your property.

Whichever option you’re leaning towards, why not reach out to a utility billing expert? You can get help navigating all of the rules and regulations in place surrounding billing, and benefit from their expert guidance on which system would work best for your unique property. On top of that, you can get the data necessary to help you make an informed decision. Livable has an online calculator that you can use to estimate your cost savings from RUBS, we even offer free recovery estimates!

As You Set-Up Your Billing System Be Sure You Communicate Clearly

Once you’ve chosen the best billing option, it’s time to get your tenants on board! An important part of doing that is keeping them informed. Make sure that your tenants understand what’s changing and when the changes will start. Be aware that there are guidelines that you need to follow as you’re implementing utility billing on your property.  Billing methods and any applicable fees are clearly disclosed in the lease. Any changes to that lease concerning utility billing have to be outlined in a signed addendum. You also have to give your residents sufficient written notice. Don’t worry, your utility billing company can help you keep up with all the requirements!

Your tenants may also be curious about why you’ve chosen to start billing. Talk to them about the benefits of utility billing! There are environmental benefits, and more. If you were previously charging tenants a flat fee, with a new method you can give them more control over their utility usage and the accompanying expenses.

While Billing is Underway, Be Sure to Keep Communicating!

You can make billing part of your strategy to encourage conservation on your property. Sharing conservation tips can help too! There are simple adjustments to everyday actions that your residents can make to conserve utilities. According to Rutgers, families can save up to 2% on heating bills just by lowering their thermostat by one degree. Share with your tenants the information that they need to make a difference. This includes utility data. By giving your tenants access to utility usage data, they can monitor the impact that their activities have. This might even provide further incentive to conserve!

Even with careful planning and the successful rollout of your new billing system, your residents may need continuing support. If they still have questions about the various ins and outs of the system now in place, it’s important to address those questions to help keep your residents happy. Your utility billing provider can help you with that too!

Livable is a full-service residential & commercial real estate billing partner. Focusing on bulk amenity/utility billing, our mission is to promote savings and conservation through education. Our suite of cloud services and end-to-end solutions helps to reduce monthly consumption, overall expenses and adds more money to your bottom line. To learn more, visit livable.com.

Here’s a checklist for keeping your fire and life safety systems ready in the event of a

Here’s a checklist for keeping your fire and life safety systems ready in the event of a disaster.

By Steve Goyette, Vice President, Telgian Fire Safety Services

Fire and life safety for small apartment buildings includes a wide variety of measures, many of which are more than capably handled by on-site management personnel.  Here are some general categories to consider, along with specific actions that can improve preparedness in the event of an emergency.

Fire Extinguishers

Monthly –  Perform a visual inspection to ensure visibility / accessibility of the extinguisher, presence and correct position of the locking pin and an unbroken tamper seal.  Inspect the extinguisher for any physical damage, leakage, corrosion, or a clogged hose or nozzle.  Inspect the pressure gauge to ensure it is in the correct operating range.  Pick up the extinguisher to ensure it is full, placing it back in the correct position when done, which includes making sure the stickers (typically “how to use” the extinguisher) are legible and facing outwards.  Check the extinguisher tag and note when the annual inspection is coming due, then initial and date the back of the tag.

Annually – Hire a licensed contractor to perform an annual fire extinguisher inspection, which will likely include additional services (such as 6-yr and 12-yr) on some of the extinguishers in service.

Exit Signs / Emergency Lighting

Monthly –Perform a visual inspection to ensure the units are mounted correctly, have no obvious signs of damage, and the lenses are clear and unbroken.  In addition, perform the “push button” test by holding down the test button for 30 seconds.  During this time, the device should light up with full display, and if not, the unit should be serviced by a licensed contractor.  Update the inspection log with results and any noted items requiring repair.

Annually – Hire a licensed contractor to perform an annual emergency light/exit sign inspection, which may require additional services such as batteries, bulbs, or light fixtures for those that do not pass the inspection and test.

Housekeeping and Landscaping

Regular upkeep and maintenance of the property is crucial to allowing for an effective prevention of fire, as well as response when an emergency does occur.  Be sure plants and landscaping are well trimmed and not impacting egress pathways, dead and down foliage is regularly removed from the property, common hallways and walkways are clean and free of debris/storage to maximize exit space for residents, and that stair rails and steps are in good condition with proper lighting.

Exit / Stair Doors

In some cases these doors are connected to the fire alarm system, or local smoke alarms, and are intended to close in the event of smoke or fire to prevent the effects of the fire (smoke / heat) from entering the exit path for residents.  Ensure these exit and stairway doors remain functional and latch fully.  Do not block or lock any exit and stairway doors. It is critical that they open and close normally.

Fire Alarm Systems

For those facilities equipped with a fire alarm system, there are a few key inspections that a property manager can conduct, in between inspections from the licensed contractor, that help to ensure the system will be ready in the event of a fire.

Weekly – Perform a visual inspection of the fire alarm control panel to ensure that the power indication lamp is on, and that there are no trouble signals, supervisory signals or alarm signals.  In addition, weekly visual inspection of the notification devices (horns, strobe lights, combination horn/strobe) to ensure they’re mounted securely and free from obvious physical damage.

Semiannually – Hire a licensed contractor to perform a semiannual and annual fire alarm inspections.

Fire Sprinkler Systems

For those facilities equipped with a fire sprinkler system, there are a few key inspections that a property manager can conduct, in between inspections from the licensed contractor, that help to ensure the system will be ready in the event of a fire.

Monthly – Perform a visual inspection of the water pressure gauges on all risers to ensure proper pressure and absence of closed valves in the system.  Also, perform a visual inspection of alarm and dry pipe valves to ensure they’re free from physical damage and corrosion. 

Weekly or Monthly – Perform a visual inspection of all fire sprinkler system control valves to ensure they’re in the proper open position and are free from physical damage and corrosion.  Perform inspections weekly for those only secured with a tamper seal, and monthly for those secured with a lock, or if supervised by a fire alarm system.

Telgian Fire Safety Vice President of Business Development, Steve Goyette, CFPS, SET, has over 35 years of experience in fire protection design and consulting, including fire sprinkler contracting. He is a Certified Fire Protection Specialist (CFPS), as well as Level III NICET certified in Automatic Sprinkler System Layout.  Steve Goyette can be reached at sgoyette@telgian.com.

By Brittany Benz

Having solid relationships with your residents and owners is key to your success

By Brittany Benz

Having solid relationships with your residents and owners is key to your success as a property manager, but did you know it is also critical when it comes to your vendors?

When you think of vendors, your relationship might not be the first thing that comes to mind, but it should be. Why? Because having vendors who respond promptly and resolve maintenance problems efficiently will ensure happy renters and owners.

However, in today’s tight labor market, finding quality vendors who have the staff on hand to respond to your maintenance needs can be challenging. 

The labor shortage in skilled tradespeople is still ongoing, with approximately 77% of tradespeople agreeing there are insufficient hands to go around, according to a 2021 Angi Skilled Trades Report. This means building relationships with vendors is more critical now than ever before.

How do you build (and maintain) strong working relationships with your vendors that will save you time, money, and frustration? Read on to find out. 

1.) Be an excellent communicator

Poor communication causes errors that make you and your vendor lose credibility. Missed deadlines, confusion, and a myriad of issues all stem from a gap in information caused by a lack of clear communication.

For example, a vendor arriving at the job site to find that they need a specialized tool that’s back at the shop will leave them frustrated, slow the work down, and create extra work for everyone.

Here are a few strategies that will help you be an excellent communicator:

2.) Recognize their efforts

Just as you realize there is a need for recognition for jobs well done by your team members, recognize that vendors are also part of your team and need your support just as much or more so. 

When a vendor feels recognized and appreciated for their hard work, they are more likely to continue to do top-quality work for your business.

3.) Pay them on time

Nothing speaks louder to vendors than on-time payments. Late payments will quickly erode your vendor relationships. Pay them promptly as work is completed, and remember to include a hand-written note that compliments their work and communicates that they are a valued member of your team.

Utilize an online payment system to ensure nothing falls through the cracks. Monthly vendor statements from accounting should be on your to-do list. Keeping their financial well-being in mind shows them that you are working on their behalf and builds trust.

Additionally, file your 1099s on time. Using property management software with built-in accounting tools like AppFolio Property Manager makes it simple to automate accounting processes and reduces errors and late payments.

4.) Offer digital tools to streamline work

In today’s world, there is a good chance your vendors are already using technology. According to the 2021 Angi Skilled Trades Report: 

Make life easier on your vendors by providing the on-demand digital tools they want and expect. When you use digital tools for work orders, invoices, and communication, you can streamline processes and save time and money all around.

Using a tool like AppFolio Smart Maintenance can instantly optimize your operations. Smart Maintenance uses automation to intake maintenance requests from residents and convert them into work orders, which are dispatched to pre-approved vendors so you’re not switching between systems to send out requests or going back and forth making phone calls. This feature also works around the clock, so you can better serve your residents — no matter the time of day or night.

Your vendor relationships matter

Making your vendors feel like a part of your team and providing them with the digital tools they need to succeed will strengthen your relationships. Stronger relationships often lead to improved work quality, and efficient work often leads to happier residents and owners. 

Being in partnership with your vendors also means increased savings to your bottom line. Start by reaching out and providing digital tools for them. Additionally, using a single property management platform can help you maintain transparency with your vendors and optimize your workflows. For more tips on how to find and keep reliable vendors and maintenance techs, take a look at this article.