Category Archives for Scott Esmail

What to Know About Raising Rents

When you are a property manager or landlord it can be a very challenging thing to know when to raise peoples rents and by how much. You want it to be beneficially for you but at the same time not have it to high forcing tenant to move out causing you to have a large amount of vacancies.

The first thing I would recommend is to do your research. There are plenty of websites now a days that can assist you in determining what fair market value would be to rent in your area for e.g.. www.zillow.com and www.rentometer.com. These sites will giving you a good determination what you should be charging.

The next thing I would say is don’t raise everyones rent at one time. Chances are that not everyone’s lease will finish at the same time but if they happen to be around the same time frame I would recommended you stretch them out as much as possible, again you don’t want to risk having to may people move out at once.

A tip that might help and I find to be a very effective method is to try your best to time it and raise rents around tax time. It will benefit both you and the tenant in the sense people have extra money around this time of year and if they are not happy and don’t want to move forward with he new rent amount they aren’t stuck with no extra money to move and find a more suitable place. This will also benefit you because people are always looking to move at this time because they have extra money so you will stay vacant for a less amount of time. Second best time would be around when kids start school. People alway want to move and get settled before the new school year starts so its best to raise rents around these times because chances are you can rent the unit out much quicker if the tenant decides to leave.

Written by Scott Esmail

What to know about filing an insurance claim on you property

When owning a property one of the things that come along with it is having to obtain insurance for your home(s), whether it be your rental properties or primary residence. While everyone hopes you never actually have to use the insurance there may come a time when damage can occur whether it be a natural disaster or accidental that you will have to file a claim.

If you are an investor chances are you have a commercial policy as group insurance for all your properties, this is often different from a regular residential home policy where you have a flat rate deductible of around $500-$1000, generally the lower the policy amount the higher your deductible will be. Commercial policies are often a higher deductible it usually will equivalent to on average 2% of the value of the home so for example if your home was valued at $137,000 your deductible would be around $2700. This is something you would want to pay attention to especially depending on the severity of the claim it may end up costing you less to just get the work done without filing a claim. In both cases when it is a natural disaster it wouldn’t effect your rate, however if it is accidental you could expect an increase upon renewal.

The process for commercial claims can be a bit different. Generally the insurance company will send out an adjuster within 48hrs to access the damage. Once they do so they will offer a settlement payment for damage which will not necessarily cover the damage. They would then offer you this payment amount to hire a contractor to get the work done yourself.  You can then hire a contractor to give a quote for what the work is going to actually cost and appeal the settlement amount, at which point they will re-visit the amount with the contractor. For residential they will often hire contractors they are affiliated with complete the work. I often find either way the pay outs do not cover the complete cost of repairs which is always something to consider when filing a claim.

Written by Scott Esmail

How to prepare your home for a Hurricane

Many of you have been wondering with the events of hurricane Irma tearing its way through parts of the Caribbean and headed towards the US State of Florida “How do I prepare my home for the hurricane to avoid as much damage as I can”? In such a circumstance as this one it may be impossible to avoid having any damage but here are some things you can do to best prepare your home and yourself for this and other devastating events

  • Board up all your windows with wood or any material that may protect the glass from shattering
  • Make sure you put all patio furniture, garbage bins or any other items outside your home that are at risk of blowing once the strong winds hit
  • If you have a garage park your car in there to avoid it getting damaged by items blowing around outside
  • Put all personal/important documents in a sealed waterproof container
  • Get rid of any chemicals that can cause explosions or health hazards if mixed into flood water
  • A generator is always good to have incase of a power outage it can help store power to the most needed items in your home (Be sure to check full instructions on how to use prior)
  • Fill up your bathtub with water (this can be used in the event you don’t have running water to flush toilets and for sanitation)
  • Move furniture away from windows
  • Trim all dead branches and trees (prior not during)

For a complete supply list of items for you should have prepared for you and  your family please click the link below that The Red Cross has provide to ensure safety for all https://www.redcross.org/images/MEDIA_CustomProductCatalog/m4340160_Hurricane.pdffor This list includes all important items to have on hand including water, non-perishable foods, and safety items that can protect you and your family

The most important thing to always remember when encountering such a traumatic situation is your home and belonging can alway be replaced but your life cannot be. Always put yours and your families safety as the number one priority and be sure to stay inside during these storms do not attempt to leave any safe area and always listen to your government officials if they recommend you to evacuate prior than that is what you should be doing you lives are not worth the risk.

Stay Safe everyone

Written by Scott Esmail

Should I qualify a not so good tenant is they have a co-signer?

I often run into this scenario where a prospective tenant does not meet the requirement I have in place but are willing to find a co-signer to strengthen their application. It can be a difficult decision based off the persons previous history weather or not its worth putting a risk on them, in the event I decide I am willing to take the chance here is what I tend to look for and run away from

positive_thinking

If the prospective tenant has a recent or multiple eviction I will most likely not rent to them even if they get a co-signer. If they eviction was a one time thing and more than 5 years old and since then they were in good standings I will allow a co-signer. Of course either way with a co-signer or not you have to be sure the person(s) can financially afford it. Generally the co-signer will not be the one paying the rent they are more of an insurance if they don’t pay it for whatever reason they will be on the hook to help.

In regards to what requirements I look for in the co-signer they must have a steady job and make steady income they must have a credit score of 700 or higher and its even better if they own not rent. There stronger the co-signer the better the chance you have of getting your rent money because the co-signer will most likely not want to jeopardize their credit since they have kept if clean this long or they won’t want you to put a lien on any property they own.

Chances are if they are willing to co-sign for someone and meet all the requirements listed above they are confident the prospective tenant is going to come through and pay their rent and not cause them any issues. Another thing to make sure of is to always add the co-signer on the lease as financially responsible and have them sign and be sure to get their contact information incase the tenant does to something wrong you can notify them immediately.

Written by Scott Esmail

What is a 1031 Exchange?

Have you ever want to sell one of your properties or regret buying one in a specific area. This happens to a lot of investors and often the find themselves contemplating whether its worth it or not due to a hefty capital gains tax bill they may incur at the end of the year. The IRS has offered a unique way to help investors in such cases and its called a 1031 exchange. By doing a 1031 exchange it allows the investor to sell their property and reinvest the proceeds in a new property and to defer all capital gains taxes. IRC Section 1031 (a)(1) states: “no gain or loss will be recognized on the exchange of property held for productive use in a trade or business or for investment if such property is exchanged only for property of comparison which is to be held either for productive use in a trade or business or for investment.

someone-writing-paper

This may sound little complicated and of course there are rules you have to follow. In order to complete such a transaction you must go through an authorized 1031 exchange company to conduct your transaction. They generally charge between $750-1000, these fees will come out of your hud proceeds. This companies will go over all the guidelines and explain the steps to ensure your transaction goes smoothly. The most important thing to remember is to not sell the property before you plan on doing this. There are rules which involve you having to find the property you are exchanging it for within a 45 days of selling and have 6 months to close on it. You cannot sell and collect any funds and then try to find a property to replace it. The transaction must go through he 1031 exchange company in order for it to be valid. Also this will only work if the property is in a company name not person and names cannot be changed between properties.

 

Written by Scott Esmail

What is a 15 day notice

A 15 day notice is a notice you can give to tenants if they are not in a lease contract and are on a month to month tenancy. The purpose of this notice to be given is if you no longer wish to rent to the current tenants. You would need to check with your State or County to make sure this notice is applicable where you live, but this is what applies in the State of Florida.

Here is some information listed that can be found on the notice instructions “15 Day Notice – If the landlord needs possess of this property and it is not for any of the previous reasons and the rent is paid on a month to month basis, this form would be used giving the tenant a fifteen day written notice to vacate the premises. This notice should be given fifteen days prior to the rent being due. If the tenant does not vacate, the landlord would file his complaint for eviction. If a written lease agreement has been entered into, this section does not apply.”

 

 

Along with this you would have to complete and fill out the required information which would include the date of vacancy which would be counted from 15 days after the notice is served ( do not include the day it was issued count from the following day). The date it was issued must be included as well as how the notice was served, whether the be posting on the premises (which is the best way in my option) hand deliver, or certify mail which you need to make sure any previous agreement that you may have had that has expired prohibits this.

 

Written by Scott Esmail

1 2 3