Stress
Thursday, January 03, 2008
I'm stressed.
Our lease is up on our apartment on January 31st. We haven't done much to prepare for moving yet. Our house officially went off the market last Sunday after not selling for a year. It's disappointing, but not unexpected, I suppose.
Anyway, the plan was to move back into our house and either re-list in the Spring if the market is looking any better, or stay for a few more years if it's not. The house doesn't really fit our needs for a few reasons, but it's a nice house and we were fine living there for the first five years we owned it.
(We moved out into an apartment originally because we didn't like the idea of showing the house while living there. Both of us are homebodies and we're both probably too neurotic about our privacy. I don't like the idea of strangers walking around my living space while I'm not there.)
But then I talked to a lady I work with about renting out the house. I wasn't interested in renting previously because it's a hassle. My father was (and still is) a landlord for many, many years and just hearing about the headaches he went through made me decide that renting would cost me my sanity. But, my co-worker recommended a rental property management company and gave them a glowing review. I looked into it and although they make a decent amount off the rental, they take care of everything. And it's more money for us than having the house sit empty.
I called our apartment office and our apartment isn't rented yet. Which means we could stay and avoid the hassle of moving right now. I don't mind the moving part so much, but my husband hates it. (Actually I'd rather move now than in the summer.)
So that leaves us with a couple of decisions...
1. Move back to our house by the end of the month.
2. Rent the house and re-sign our current lease for another six months or year.
3. Rent the house and move to a bigger apartment, but then totally ignore the reason we're looking into renting in the first place.
We're meeting with the property management company on Saturday to discuss our options there. And I guess we can decide from there.
I'm stressed because everything is up in the air and I can't see a clear path through it yet.
Thursday, January 3, 2008 at 1:24:00 PM CST
Sorry you have to start off the Great '08 this way.
I don't know enough about your situation to make a very good suggestion. But that's never stopped me before!
I'd go ahead and let the management company handle the rental (insist on top dollar). In the meantime, allow your realtor to continue listing the property. If anyone wants to look at the place, it's the renters that will have to deal with that. Sign a six month lease and be looking for your "ideal" place in the coming months (minus the stress - you'll have plenty of time to find it). Meanwhile the rental income will cover your lease expense, even if you decide to cut it short because you find your "ideal" in 3 or 4 months.
I think at least this would remove the eminent stress created by the looming Jan. 31 date.
Thursday, January 3, 2008 at 2:36:00 PM CST
Hey, John. Thanks for the post. :)
I think most of the reason I'm stressed out is that I had convinced myself a couple of months ago that we weren't going to be able to sell and we would move back in. I didn't want to move back, but I decided it was the best thing to do and I started making plans and basically made peace with the idea.
Now that Matt is stressed out about moving I've tried to work around it. And it's bumping around all of my preconceived ideas of where we would be in a couple of months. But that's OK. I'll adjust. It just takes me some time to get used to the idea.
I think I really wanted to move because I'm sick of the small apartment. But I really need to do is get rid of stuff or pack up some stuff to give us more space. That's not going to be any more work than moving (less, actually!).
I think we'll end up staying in our apartment and renting as long as we're comfortable with the property management company. Otherwise we'll move our butts, get packed, and be back into the house before our lease is over. :)
I just needed to get used to the idea of something different.
Thursday, January 3, 2008 at 5:42:00 PM CST
But what I really need to do is get rid of stuff or pack up some stuff to give us more space.
My wife has been promising to do this ever since the dinosaurs still roamed the Earth. You'll be happier if you just accept the fact that it ain't gonna happen.
It sounds like you're letting your unfulfilled expectations stress you out. Why not take a deep breath, erase all your nesting dreams from your mind, urge Matt to do the same, have a nice dinner and some good wine at a restaurant, come back home and watch a favorite video, and just clear your head. Allow it to stay clear for two or three days. Then approach your living situation as if you'd never thought about any of the options before.
Of course, that's all easier said than done. I'm not sure I'd be able to accomplish it. But that's what I'd encourage myself to do, and so I'm passing it along.
Thursday, January 3, 2008 at 6:16:00 PM CST
Good advice, Ex. But I won't be able to relax until we've made a decision. I hate the unknown. The nebulous, far off unknown is OK, but not tomorrow or next week. Maybe I'm a little neurotic in that way. :)
But as soon as I feel like I have a course of action I feel OK. I'm not stressed out about moving because at least it's a decision and I can take action. It's when I can't take action that I get stressed.
You should see me try to handle other people's problems. It's not a good thing and I've tried deal with that by stepping away and only offering to help if it's wanted or needed. :P
But now that we've narrowed it down to two choices I feel better. On Saturday we should be able to make a decision and then act.
But a glass of wine sure sounds good right now. :)
Thursday, January 3, 2008 at 8:34:00 PM CST
Stay where you are and hire a property manager to rent and manage your house for the next 2 years and then put it back on the market...
The 5 MYTHS about using a PROPERTY MANAGER.....
1. “It costs too much money.”
Actually, using a property manager will increase NET rental income in most cases. Rental property owners managing their own property tend to “discount” their rent in order to attract residents. Experience, however, indicates that property managers charge ‘Market Rent” and therefore attract and qualify better residents. Any fees or costs involved with the use of a property manager are more than covered by the increase in rental income.
2. “I’ll loose control of my property.”
Most property managers will be able to anticipate the potential for many rental property problems....tenants want to buy a house; can’t pay their rent on time; need “special handling”. Experienced property managers have handled many tenant issues before and can work with owners and tenants to resolve difficulties.
3. “I want to do property repairs or designate repair people familiar with the property.”
Property managers are often willing to use owner designated or repair personnel familiar with the rental property. In many instances, when repair personnel utilized by the owner are unavailable, the property manager can utilize their own vendors and repair people and ultimately save the owner money. In reality, service personnel would much rather work with a professional property manager familiar with their services rather than deal with individual owners.
4. “I think I can get better tenants.”
Visit a few tenant “gripe” sites on the web and you will read what tenants really think about non-professional property managers. Rental property owners often manage by the “wish/hope” management theory - they wish their tenant would pay their rent and hope that they don’t destroy the property. A professional property manager has the tools at hand to screen and qualify good tenants willing to pay market rent for a well-maintained rental home.
Also, a professional manager has the ability to negotiate with the tenant and the owner to create a win-win with no “ego” involved. Rental property owners quickly tire of dealing with abusive or complaining tenants and become non-responsive; OR, they do way too much for their tenant’s benefit and their investment becomes a “cash drain” and unprofitable. A professional property manager knows what is required under state and federal laws as well as the controlling written lease agreement. If the tenant’s request is unreasonable, an alternative might be suggested. If a tenant’s request is reasonable and the owner’s property would ultimately benefit, a property manager can point out the benefit of the request.
5. “I would like to “try” management myself, first.”
Unlike many investments, the ownership of rental property is governed by many laws and regulations. The federal government not only has tax regulations, it also has fair housing, lead based paint and other onerous regulations that apply to rental property. The state may also impose more fair housing regulations as well as landlord-tenant laws and regulations to govern the relationship. Learning all these rules and applying them properly is very time consuming.
Keeping current with these various rules and regulations is onerous and not knowing items and procedures are required can be costly in the long run.
The 5 MOST IMPORTANT QUESTIONS to ask
when interviewing for a PROPERTY MANAGER.....
1. “Do you do property management and general brokerage?”
Ask it just this way so you can determine if they really want to sell your property or sell you more property. If they do property management as a way to get or keep real estate clients, they are doing it as a “courtesy” and rarely have the experience, education or dedication to do the job properly. When the going gets rough with your property, chances are they will be too busy to return your calls.
“Full time property management companies provide the best vehicle for overseeing your single family, detached residence in your absence. The best ones for residential properties are NOT affiliated with real estate brokerage companies and do not depend on commissions for income.” THE ABSENTEE LANDLORD’S SURVIVAL GUIDE (Second Edition * 1997)...Jack Rower
2. “How long have you worked as a Property Manager?”
.....NOT real estate....property management
While property managers may have the same state license requirements as real estate agents who sell property, property management is considered a “specialty” requiring direct and specific knowledge of the field. Additionally, the more experience the manager has, the more expertise you will have at your disposal.
3. “When was the last time you took a property management course?”
Unlike the practice of real estate sales, property management is governed by specific rules that can be changed or altered in many ways....state legislature(VRLTA), case law, direct government regulations (Fair Housing/Discrimination) so having a professional manager who keeps abreast of these various law changes is crucial to you as a client. Again, the more knowledge that is available to you in the management of your investment, the less likely you will be unpleasantly surprised during your relationship.
4. “What professional property management affiliations do you have?”
Most real estate agents belong to a Realtor organization. Property managers, however, can obtain more expertise and education through such organizations as IREM * Institute of Real Estate Management. The more information and knowledge that a property manager has, the more information and expertise will be available to you in the management of your real estate investment.
5. “Do you own rental/investment property?”
While it is easy for a property manager to say “they feel your pain”, somehow it is easier to take bad news from someone who has been there....negative cash flow and all. Be suspicious of a property manager who has all their “eggs” in the stock market.
Lastly, ask yourself....would you rather pay a little more for an experienced property manager, or pay a lot more to an attorney when your property manager makes a costly mistake in the management of your investment real estate.
Gibson Management Group, Ltd.
Over 40 years of property management experience, at your service
* http://VAHomes4Rent.com *
Thursday, January 3, 2008 at 10:33:00 PM CST
Man, that's rough. Try not to stress though. I mean, what's the worst that could happen? You're not going to end up homeless and on the street.
Let us know how it all works out. *crosses fingers for things to go well with the rental management company.