BiggerPockets

New position!

Saturday, July 23

Hello, everyone:

     This is a short post to let you know that I've accepted a new position at:

Hampton & Hampton Management & Leasing, Inc.

7524 Municipal Dr.

Orlando, FL  32819

205-445-4755 cell

407-253-9324 office

407-253-9326 fax

email (temporarily) to burgessrentals1@yahoo.com.

Tenant prospects:  Feel free to write or give me a call with your needs.

Owners:  Please give me a call for a free, no-obligation estimate of what your home may garner on the rental market today.  I'll also be able to answer any other questions you may have.

Fellow Realtors:  Please feel free to forward me any property management or leasing referrals you may have- understanding that at Hampton and Hampton, we are a non-competing brokerage.  If you refer a tenant to us, we won't compete for their sales business.  If you refer an owner (management prospect) to us, we will refer them back should they choose to sell down the road.

Thank you for the opportunity to be of service.  Please watch for more updates soon.  God bless you.

- Dennis Burgess

Owner's foreclosure: not a "get out of your lease free" card

Tuesday, April 19

     Not many years ago, mold was the proverbial "get out of lease free" card.  Tenants knew it and shared the info with their friends, real estate practitioners of the property management-type knew it and showed a great deal of concern for it, and property owners knew it and feared it.  Over time, though, education and sharing amongst everyone has reduced (but still hasn't fully dispelled) this line of thinking.  Tenants are for the most part are aware of what is "gonna make you sick or kill you"-type mold, what is "you need to start using your vent fan and take some Clorox to clean that spot over your shower"-type mold, and the differences between the two.  Many property managers have also been enlightened to the differences, and they now work to better preserve their owner-clients' revenue streams by not letting a tenant walk when it's not warranted.

     The same learning curve exists with regard to tenants in receipt of foreclosure papers.  I think of Glinda, the "Good Witch" in The Wizard of Oz, who asks Dorothy "Are you a good witch or a bad witch?", as a similar question bounces through their heads- "Is my owner a good owner or a bad owner?".  And while I may very well be asking myself the same question when I first hear of the papers, the bottom line is the same for all of us- it doesn't matter.  There is no correlation, repeat- no correlation, between an owner's payment of a mortgage and a tenant's obligation to pay their rent.  The obligations are for the most part mutually exclusive.

     Leases are legal documents, and tenants are expected to fulfill them- period.  Federal laws, specifically the "Protecting Tenants at Foreclosure Act of 2009" afford tenants in bona fide leases prior the filing of lis pendens against owners, but I've never seen a law at any federal, state or local level that allows a tenant to simply walk away from their lease due to the singular fact that a lending institution (or HOA in many cases these days) has looked to effectively repossess their home.  As a property manager, it's my duty to protect my client (the owner) and work with my customer (the tenant) towards ensuring they remain in the home and fulfill their lease as agreed.

     These situation are unpleasant, and whether an owner is a "good witch" (one who's simply fallen on hard times and is struggling to do what's right) or a "bad witch" (one walking from their obligations with little to no regard for the tenant while at the same time expecting the tenants to live up to theirs) is surely debatable. 

     What's not debatable is the fact that the "get out of lease free" card is worth about as much as the piece of Monopoly cardboard that it's written on.

Home warranty or no home warranty? Good question.

Tuesday, April 19

     I've had experiences both good and bad with warranties- American Home Shield, Old Republic, etc.  I've had prompt service and slow service.  I've had work orders dispatched to vendors I routinely use and love, and some dispatched to vendors I'd sworn I'd never use again.  All told, I've seen enough of the good and bad that I feel pretty comfortable in giving my clients a fair answer.

     In deciding whether to purchase a warranty, I tell them to consider the following:

- Age of home and its appliances.  If a home is new and/or its appliances are new, there's a good chance that a problem arising right away will be covered by either a builder's warranty or a manufacturer's warranty.  Just as you don't need to buy insurance on a rental car if your "regular insurance" covers you, there's no need to rush to get a home warranty and find yourself doubly-covered.

On the flip side, you should give a warranty serious consideration if your home or its appliances are old.  It's neither fun nor cheap to repair that A/C that's "on it's last legs" when you leave your home and gets that last leg knocked out from under it a short bit into a tenant's lease.

- Quality of your appliances and value of home.  The higher the quality of an appliance, the higher the repair costs.  More consideration should be given to a warranty as the quality of appliances rises.  It makes precious little sense to purchase a warranty if all of your appliances can be replaced with a year's premiums!

- Price of warranty and it's coverages.  In short, read your contract.  I won't say that any warranty plan is a scam or rip-off as I've heard many say.  Warranty companies I've dealt with have always lived up to their contracts.  The problem lies in the fact that many policyholders don't read the contract.  They assume things are covered (and we know what that gets them), only to have something break and find that it's not.  Pay particular attention to the exclusions- it's great to have a dishwasher replaced, but don't get blindsided when you're told you have to pay extra to have the dead one removed.

- Ask about vendors the warranty company uses.  Check reviews on some of them and see what others think.  Find out whether you can use different vendors that the warranty's preferred ones and still be covered.  Some have "out of network"-type deals where you can use a licensed vendor of your choice for an extra charge.

     Home warranty or no home warranty?  It'll always be a bit of a tough question- but with a bit of homework on the owner's part and soild guidance from a professional property manager it won't be too hard to answer.

Craigslist housing scam- story/transcript/video

Tuesday, April 19

     Erik met me at a rental home of mine and conducted the interview.  The following is the transcipt, and the link at the bottom tracks back to the story.  You may follow the link that will take you to the video.  Please feel free to share this with any and all you think may benefit from it. 

     Again, many have heard the "stories" about the scams- but in my humble opinion no one has done a better job than Erik in bringing illustration to the story.  Story, transcript and link included with expressed written permission from WKMG-6, Fox Orlando.  My many thanks to them for allowing me to include this in my blog.  I feel it's a must-see for those that remain in the dark and feel that these things don't really happen or can't happen to them.

http://www.clickorlando.com/news/18651834/detail.html

Housing Scam Uses Craigslist As Tool

Renters Offered Great Deals On Renting Homes

POSTED: Thursday, February 5, 2009 UPDATED: 10:39 am EST February 6, 2009

ORLANDO, Fla. -- A scam in Central Florida involving a popular Web site attempts to prey on individuals who are looking for affordable housing.

Scam artists are using Craigslist.org to place ads for homes to rent using the same name as the actual renter but a different e-mail address. The ad promises quality homes at an inexpensive price, but the person posting the ad does not own the home, which may be occupied by legitimate renters.

Dennis Burgess, a property manager, said his name was used on a Craigslist posting by a scam artist, who offered a Caselberry home on Queens Mirror Circle for $900 per month. The four-bedroom house is nearly 3,000 square feet, sits on a ski lake and has a large back yard. It also has a pool and wood floors.

Kathy Rapp is the real renter of the home but said the day they moved in was quite bizarre.

"We had four people look at the house on the day we moved in, thinking that the house was available and they were renting it," said Rapp, who added that people showed up with what they believed to be legitimate leases.

"I showed one person the lease, and they didn't believe me," Rapp said. "I was shocked, amazed, so I called Dennis right away," Rapp said. "He didn't know. He had to look into it further." Burgess said he then discovered that someone had designed an ad and placed it on Craigslist, a site where you can buy, sell and rent items.

"Apparently they'd used my actual ad (and) changed something around, changed the e-mail address," Burgess said.

The fake ad listed a price of $900 per month but later disappeared, causing several people to track down the real Burgess.

"They actually spoke with a Nigerian Dennis Burgess -- accent is just a slight bit different. This gentleman was still telling (people) to wire money, $900, and once he'd got the money, he'd give them the keys and ready to move in," Burgess said.

A would-be renter kept an e-mail exchange with the scam artist, who wrote that he is "Dennis Burgess, the owner of the house you are making enquiry (sic) of." The e-mail said he was in "Nigeria for an international Christian follower's crusade" and that he is "kind, honest and trustworthy."

The scam artist sent a form, asking personal questions, such as "Do you smoke?" and "Do you work late at night?"

The would-be renter asks for proof that he's the owner, and an e-mail stated, "You have nothing to worry about, with trust that we are letting our house to you people cause we found your application satisfary (sic) and want to have you people occupy the house."

"It hurts my name, weighs heavy on me, because it's Dennis Burgess. Their leases are drafted Dennis Burgess, at least at first look, they think I've deceived them. I hate that," said Burgess, who had to inform dozens of would-be renters who nearly wired $900 via Western Union.

"I can't really say I'm surprised," said Florida Department of Law Enforcement Agent In Charge Wayne Ivey. "The economy is tough. A lot of people are looking for that great deal out there. The criminals know that, and they're taking advantage of it."

Ivey said the amount of scams has increased lately.

"Because a lot of these scams, especially the phishing scams, they're operated from overseas, which makes our job just incredibly tough. And even if we can identify where it came from, it makes it real hard to put a body with an arrest on them," he said.

"There are no safeguards that I'm aware of that would safeguard someone from copying your information," said Jeff Francher, realtor with the United Realty Group. Francher said Craigslist is not to blame because many realtors use the Web site as a tool to sell and rent houses.

Francher said prospective renters or buyers should research the ads, saying there's no harm in calling a phone number or sending an e-mail. But he said you should never send any money or personal information until the property has been checked out.

Francher said using the county's property appraiser Web site is also a good idea.

"It's a good indicator of what's fair," he said.

It will also show who owns the house.

"Don't just take it and say, 'Wow, that's a great deal. I'm going to jump on it.' Take it to that next level and investigate it, just as you would as if it's going to impact you for the rest of your life, because really it can," Ivey said.

"I want to get the word out: If something looks too good to be true, it probably is," Burgess said.

Why is this a FSBO?

Tuesday, April 19

"Why is this a FSBO?"...or "Why is this a FRBO?"  You've undoubtedly asked yourself that question before- as you've perused the real estate section of the local paper, as you've sifted through endless craigslist ads, or as you've read that hand-made sign on the street corner and also tried to figure out why someone with the world's worst penmanship got picked for "sign-writin' detail".  Makes you wonder, and think before you handle them or look to do so.

A read a good post today from a fellow Realtor that says she's done with FSBO's.  They're too much work.  The sellers are too particular.  They're too quirky.  They're flaky.  And they're not loyal.  The same can be said for FRBO's, and it begs the same question and a bit of analysis.  "Why are they what they are?",  "Should we continue to work with them?", "How can we keep keep positive about them?" and "Should we even care?" are all good questions.

When things are broken down, there really aren't a great deal of reasons why an owner chooses the FSBO route- and most often I see folks falling into one of two categories:

1) Owner is aware of what a Realtor (or property manager) is, knows what they do, knows the costs- and has mulled over the costs/benefits and decided they're best served by serving themselves.  Call these owners "distressed" or "underwater" if the terms fit, call them "cheap" or "thrifty" if those do.

2) Owner is not aware of what a Realtor or property manager is, has no idea what they do, no idea how much they cost and not aware of the benefits one can bring them.  These owners may have been in comas for many years, may have lived in caves for a while, or may have just thought to themselves "Dang.  That guy that has his name and goofy picture on a car magnet the size of Texas just isn't that friendly".

Here's the deal, though:  we need to pursue both types of owners in the same way. 

If an owner thinks the sign above is the best way to market their property, we need to convince them otherwise.  If an owner thinks they understand real estate law as well as you do, tell them that you don't even understand every bit of it- but that you'll work together until all of you do.

Gather your CMA's and comps, and let the FSBO owner if you feel their price is too high- who'd want to reject advice based on sound research that could get their place sold quicker?  Meet with the FSBO owner that thinks Zillow is the greatest thing since sliced bread, and tell him your thoughts that very well may differ.  Let them know that it's nice to try and get a really high price for their home, and that you'll work towards the same goal- but it's even better when you don't let it sit until 2015!

Owners of all sorts are finicky.  All are still trying to get the most the quickest, the highest price coming in for the least amount going out.  And can we blame them?  Of course not.  Should we continue to work with FSBO's (and FRBO's)?  The answer to that question lies within our own individual cost/benefit analyses.  In deciding, though, we surely do ourselves and the profession a great service by ensuring that homeowners are as educated as they can be- whether we work with them or decline to do so.

There IS value to our craft, folks- value that simple internet searches and cardboard signs can't provide.  The best asset we can have is the ability to convey that value to the public.

What's an offer? It depends.

Tuesday, April 19

What is an offer?  Such a simple question- but one that seems to have a number of different answers.  So which one is correct?  The answer may well be "It depends".

In managing a number of properties over the years, I've given the pitiful-sounding "it depends" answer more times than I'll ever be able to count.  The response has bounced off the tip of my tongue many a time in dealing with my owners- with the "Do we have a lot of interest in my home?" question being a prime example.

The "interest" question is tough to answer, as you don't want to spout off a ton of stats that (while true) may get an owner's hopes up too high- and have them calling you every day asking why none of the "interested" parties have become tenants.  Likewise, you don't want to tell an owner that the sounds of nearby crickets are tough to handle and you just wish you'd get a call on their property so your phone would ring one danged time.  You have to have balance.

"Interest" to me means that someone has called about a property, made an appointment to see it (and kept it!), liked it a lot and submitted an application.  "Interest" to me has never been a random call from someone that just barely recollects what part of town a property's in and wants to know if the owner would accept his German Shepherd.  "Interest" has never been an inquiry about my $1,800/mo property where the caller wants to know if the owner would take $1,200/mo, and they'd only pay that if the owner threw in some type of move-in special. 

But should it be?  Should these things be "interest", and are these requests offers?  Well, that depends.  I've wanted a completed application on some folks as a gauge of their interest because it lets me do a great job towards upholding the fiduciary trust that owners have placed in me.  Someone truly "interested" in a place will apply for it (or at least look at it!), while a time-waster won't.  I feel my owners appreciate my discussing qualified folks with them- and that they'd view me in a negative light if I spent a great deal of time running down lists of everyone who's called and asked crazy questions.

But some have differing opinions- including folks in the legal community.  Some say "an offer is an offer" whether written or verbal, crazy or sane.  "An offer is an offer" whether the one making the offer is drunk or sober.  And "an offer is an offer" regardless of the conditions.  If someone asks about getting a property at 1/2 the marketed rent, call your owner and ask.  If someone asks if an owner will just let them stay in the house for free because they're cool folks, call your owner and run it by 'em.

I firmly believe in taking "offers" to my owners.  But I also believe that my owners hire me to do a job for them- and part of that job involves using my expertise and common sense to avoid calling them to discuss faux prospects' pipe dreams.