Month: December 2013

The purpose of the survey was primarily to find out where you thought our short comings were so we could address those areas of concern.

This first part of this article will post the answers to the multiple choice questions.

There we will post the most common responses to the positive criticism of our operation.

91 investors responded to the survey and most investors have multiple properties with us under management. Each investor was allowed 1 vote regardless of how many homes you owned.

These are the exact results

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The answers can be summarized as follow

1. 100% agree that cash flow properties are a good investment.
2. 96.67% agree Atlanta is a safe profitable market to own rental properties today.
3. 93.26% are happy with the value of their Atlanta houses.
4. 92.22% would recommend NES for property management.
5. 69.66% want to buy more properties.

 

Most property managers would be thrilled with the approval rating above. While we are thrilled that the high majority are satisfied, there is room for improvement.

There were some wonderful glowing remarks about all the positives about NES that would seem to contradict the few negative comments we received.

Nevertheless, our focus is always on improvement so we will only concentrate on what we can do better.

Here were some of your constructive criticism remarks and believe me, we appreciate them.

1. I don’t understand monthly and quarterly statements.
2. Prefer monthly distributions over quarterly distributions.
3. Takes too long to get paid after the quarter ends.
4. Didn’t receive all the reports on all my houses.
5. Would like itemized receipts for any repairs.
6. Better communication.
7. Would like an estimate before repairs are made.
8. Would like a video before repairs are made.
9. Would like ongoing notification of late rents
10. Would like online real time information when things go wrong.

These were the most common suggestions that we received and we are grateful to those that took the time to give us the feedback. You will receive a $20 credit for participating in the survey in your final distribution for 2013.

This feedback allows us to focus on what is important to you and make changes where applicable.

The investors that were unhappy with our communication were primarily houses that had turnovers, repairs or foreign investors that were not in compliance to receive funds from us. We have addressed every issue above the article on Going Forward in this newsletter.

 

 

 

This was a growth year for NES as we’ve added 283 new houses to manage. Our staff has increased to accommodate the increase of rental properties and we welcome the arrival of Ryan, Jennifer and Christy.

We are constantly striving to increase our effectiveness and efficiency thus we sent every investor a survey to help us see the service we provide through your eyes, the investor.

There is much room for improvement on our side and we won’t be satisfied until we deliver the results that are not only acceptable to you, but also to us.

This is an imperfect business because we are dealing with tenants and when their lives get interrupted, so do ours and so do yours.

We can select the most qualified tenants on their income and our background checks but nothing can prepare us for when they die, lose their jobs or get sick.

This year, 5 of our tenants died. Perhaps this is the only good excuse for not paying their rent but the reality is; these were good people and it’s impossible for us to be prepared in these situations.

Other statistics you might find informative are: 254 rented houses, 143 evictions filed, 26 actual evictions and overall turnovers 48. In order to attract  good applicants we paid for and put out 2,700 bandits signs this year,we paid $21,000 for radio advertisement, $18,000 for free TV’s for tenant incentive move in and $24000 for google ads and paid $11,950 to realtors for tenant referrals. This is only a portion of what we do to market for tenants and this may come out of our own pockets.

We act on your behalf in the same manner we would as if we owned the home. Our biggest concern for you, the investor, is to always maximize your return and keep your property rented by tenants that will take care of it.

Turnover is costly in terms of lost rent and repairs that are needed 99% of the time.

In order to attract the best applicants, we need properties that show well and they must have curb appeal.

Please take the time to review each article as we have addressed every issue we can think of and want you to be informed every step along the way.

Thank you for the opportunity to serve you.

 

Anthony Salmeri

The LLPP had an overwhelming positive reception by every investor except one that thought the price of $399 should be covered by the 10% of rent collected. Folks, that investor just didn’t understand the real value of the plan and the safety and certainty it gives our investors.

A review of the plan for 2013 which costs $399 for the year is as follows:

1. Investors keep homeowners insurance with the master policy that provided of the houses. This is the best homeowners insurance available and on average, you save $75 on your insurance with the coverage we have arranged for you. That coverage includes loss of rents up to $5000 and $1 million of liability protection with no co-insurance.
2. No eviction fees for the year. As you’ll remember from the first article, we filed 143 evictions this year and actually evicted 26 tenants. When tenants don’t respond to paying the rent we must pay to file an eviction no matter if we complete the eviction or not. We must keep the pressure on them even if they agree to a payment plan, otherwise, we could lose weeks, even months trying to get them out. The average eviction cost us $100 to file not to mention the time it takes to go to court and sit and wait would cost $150 if we invoiced owners for it. We don’t, it’s covered in the plan.
3. Pest Control – The inspectors that go to the house are looking for ants, termites and cockroaches. The LLPP covers you for ants and they find them on 19 out of 20 houses on all 3 inspections during the year. If left unchecked, they will do damage and these inspectors are treating your house 3 times a year. This doesn’t include termite protection, but we still check for them. 99% of our owners have acquired their properties through BuyCashFlowProperties.com and they always pay an exterminator on every house they acquire to check and treat for termites if necessary. Cockroaches would indicate that the tenant is dirty and we will treat the house and change the tenant. But, if these tri annual inspections weren’t done, we wouldn’t know it. Typically, it cost $69 per time to treat for ants, thus you are getting a real value of $207.
4. Change air conditioning filters, batteries in smoke detectors, inspect under all sinks for leaks, check all plumbing for leaks. Folks, this program is about safety and peace of mind for you. Until you pay to change an AC condenser you won’t know what I mean. Tenants forget to do this and they will let their smoke detectors buzz and not change the batteries in most cases. We use premium AC filters and the inspectors make absolutely sure that if anything isn’t working right, they will let us know the same day.
5. Interior and exterior dated Pictures with report. This report has dated pictures with remarks about the tenant i. This should give the “out of state” investor peace of mind as they see current property conditions from their laptops. Getting the pictures of the house is important and the report card on the tenant advises if we need to take action with the tenant. This is also very important when it comes to renew their lease as we have all these reports that we can use for or against them.
6. Real Estate Tax Appeal. When you play poker, you have to know when to hold them and when to fold them. It’s kind of the same way with tax appeals. We have under contract a tax appeals expert that is familiar with every county assessor. He knows when to fight and when to leave it alone due to market conditions. The verdict is not out on every house but you can see by the attachment to this list just how much some of our investors have benefited from our decision to hire him. The reports are still coming in.

This is for your benefit as much as ours as we get the inside scoop on tenant behavior and property condition inside and out.

Look at the inspection reports attached as well as the tax assessment reductions.  You will notice some very significant property assessment reductions as well as some values that are locked in. These are not all the assessments, just a sample. If you would like to know what happened with your houses, email me.       

We feel so strongly about the LLPP that it is mandatory for 2014 for every investor that we manage for. We will have a $399 fee deducted from their account on January 15^th to be a part of the LLPP.

This plan is proprietary, no one else is doing it and the reason why we do it is to safeguard you and afford you peace of mind about your investments.

National ERA Tax Appeal

210-McGiboney-Rd-Covington-GA-2-SAMPLE-POOR-CONDITION

130-BRADLEY-ST-Covington-GA-2-SAMPLE-EXCELLENTCONDITION

105-Ardella-Drive-Covington-GA-SAMPLE-GOOD-CONDITION

    

2014 is upon us and we have many changes going forward. Some of these changes are the result of the survey, others are things we have planned on doing.

The website: National ERA Servicing.com has been overhauled to provide you succinct information written and videos. There are video explanations on how to understand the monthly and quarterly reports and information for foreign investors to be in compliance with the IRS.

As much as we would like to distribute investor’s funds on a monthly basis, it is impossible and it would cause an accounting nightmare. Unlike other property management companies, we don’t hold any of your funds in reserve except what is in your account as rents get collected until distribution.

We must pay your property taxes, insurance, HOA’S and any maintenance fees that might come up. But there’s more; sometimes a tenant checks bounces or they need a short payment plan.

The biggest change we are making is to personalize your experience and we will communicate more effectively to keep you in the loop.

We don’t sweep problems under the rug, we meet them head on and want to solve them.

Most of our investors want us to make every decision for them and we understand, some of you are a lot more hands on.

We are not going to contact you every time a rent is late as there is no reason to start this dialogue which is going to absorb our time while we could be more productive screening perspective applicants. As your property manager and your main point of contact, you can email me and I typically get back to people within 24 hours. If you have an emergency you can always call me at (813)335-3980.

Whenever there are maintenance expenses on your property, we are invoiced by the contractors and we pay them immediately. If we don’t pay them fast, we lose them when we need them most, and that would be on emergencies and turnovers. We never mark up a contractors invoice and this is a big difference between us and other property managers. You pay exactly what we pay and there are no discounts to us or kick backs of any sort. Everything we do is about maximizing your profit and we treat your investment as if it was our own. We cannot upload receipts to the Appfolio website but you can have them if you want them by emailing Elsa, who handles all the investor reports.

There were some issues in 2013 with some investors not getting all their house reports at the end of the quarter. We have this resolved but if it ever happens, email Elsa.

It is our desire to wire as soon as the quarter closes. Sometimes it takes a little bit longer and it has been up to 3 weeks for some investors to have their distributions. Our goal is 7 days and I already know that January will take a while as Elsa is visiting her family abroad. Know this: We are anxious to get your funds to you as soon as possible and we are doing all we can to be more efficient.

Repairs are a necessary aspect of real estate investment and our policy is as follows:

1. Emergencies – We can’t wait as we could lose the tenant. A hail storm with a leaky roof is a good example. Or, a furnace that goes out in the middle of winter or AC in the summer. We will notify you but we won’t wait to hear from you about an approval.
2. Repairs under $500 – We are just going to do it if it really needs to be done. This is why you hired us to act in your place.
3. Repairs over $500 – We will email you or call you. If we don’t hear from you within 3 days and we are about to lose a tenant, we will act in your best intent and do it.
4. Turnover – When a tenant moves out, there is always something. We are not trying to make your property perfect. We just want it to look good and fix what is wrong as economically as possible. This is a situation where we have an agreement with BuyCashFlowProperties.com to pull the right crew from other rehabs so we can minimize your time under repair. Going forward, we will send you a video so you can see what we plan to do. We don’t wait for bids from contractors as we are going to get you the best price we can.  These are contractors that we have an established relationship with. The longer we wait to get the work don’t, the longer your house stays empty. BuyCashFlowProperties.com has 9 crews out there working full time and we know who to use for anything the house requires.

Investors, we appreciate the opportunity to serve you and want your experience to be more than you hoped for. We have made the LLPP mandatory for all investors as it saves you money and gives you the information on a regular basis about your property.

Call or email me at any time as I take the faith you’ve placed in my company to heart and want every investor to have a favorable experience.

 

Happy New Year, let’s make it profitable – together

 

Anthony Salmeri,

National ERA Servicing LLC

Managing Member