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How to's and money-saving tips from resident homeowner and mortgage professional, Cathy West

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What do renters look for in a home?

What do renters look for in a home?

When people buy homes for the purpose of renting them out on an ongoing basis – whether for permanent living situations or more Airbnb-style short-term rentals – one of their biggest challenges is determining the features these housing units should have.

Landlords will find it generally important to weigh the cost of installing certain amenities against the long-term return on investment they provide, but the more items they have that are attractive to renters, the better off they are likely to be when it comes to ensuring occupancy with few to no gaps.

Perhaps one of the most important things for homes today to have is a variety of tech options, according to Multi Family Executive. For instance, owners of Airbnb properties would be wise to make sure their rentals have plenty of modern amenities like Wi-Fi, cable with a big-screen HDTV, smart thermostats and so on.

Similarly, it's important for homes intended for long-term or permanent renting today to have robust HVAC systems. No one likes having to lug a window-mounted air conditioner into place, so landlords might be able to get a little more bang for their buck by installing central air. Those whose properties are multi-family might also want to consider the value of shared spaces, like gyms in the basement or porches for grilling, the report said.

Going above and beyond
When landlords are thinking about what their tenants might value, it's often a good idea to consider what's nice to have and not just the necessities, according to Green Residential. For instance, many people looking for an apartment might not think they need lots of closet space, but when homes offer it, that can be seen as a big differentiator. Put another way, if two properties they're considering are relatively similar, the one with big closets is likely to be the standout.

But for both long- and short-term residents, another nice and potentially unexpected feature is a robust home security system, the report said. Smart or connected alarms, video cameras, and more are all relatively inexpensive these days and can likewise help properties stand out in the rental market by offering a little extra peace of mind to renters.

Getting it right
Finally, anyone buying a home for the purpose of renting it out need to make sure every aspect of that space is in great shape on the day those tenants or short-term renters show up, according to My Smart Move. Any of these issues could cause people to have a negative initial experience that results in them being unsatisfied with their renting experience.

Of course, landlords should always strive to ensure the properties they rent out are in tip-top shape on an ongoing basis, not just at move-in, and that includes being attentive to any issues that crop up over time. To best avoid problems with the plumbing, electrical platform and more, it's vital to have those systems inspected by professionals well in advance of actually opening the property to potential tenants.

For more information about this article, call 866-614-5959.

Which personal finance best practices yield the best results?

Which personal finance best practices yield the best results?

When people are looking to buy investment homes, they will typically need plenty of capital to start turning their dreams of a personal real estate empire into reality. And because investment buyers typically face a much different mortgage process than those who are purchasing a property simply to live there, it's vital that they have their finances in order.

Perhaps the biggest impediment to buying a home that anyone – resident or investment buyer – will face is the amount of debt they carry apart from the mortgages they're hoping to obtain, according to Refinery29. People typically have student loans, auto financing and credit card debt, and altogether these balances can create a major impediment to building savings and meeting lenders' stringent debt-to-income ratio requirements. As such, paying down high-interest balances should be at the top of any would-be mortgage borrower's to-do list.

What's the benefit?
When consumers tackle high-interest debt first, they free up potentially lots of money each month, the report said. It may take some time, but cutting into balances means lower monthly minimum payments. That progress, in turn, frees up even more money to be devoted to paying down that debt, and so on. In the end, people may be able to reduce their monthly payment requirements by hundreds of dollars or more, all of which can go toward building savings for down payments and other financial concerns.

In addition, anyone looking to make an investment home purchase might want to consider the benefits of looking at their monthly budgets to make sure they're spending money on the right things, according to Experian. After all, when people take the time to evaluate where their money goes each month, they may be able to find inefficiencies that will allow them to free up even more money that can improve their mortgage applications.

Focusing on the key issues
It may also be wise for those looking to buy an investment property to think about the ways in which that first step will only help them grow their finances and keep them moving forward consistently, according to Go Banking Rates. Of course, not all investments work out, so it's wise for would-be buyers to do as much research as possible into their options, the markets in which they're looking to buy and what will be required of them on an ongoing basis as the owner of such a property. Those just getting their start in this portion of the housing market will probably need a bit of direction they can't always glean themselves.

As with anything else in the mortgage process, the more homework people can do before getting involved, the better off they will be when it comes to facilitating and finding a deal that will work well for them in the long term. Talking with real estate or financial professionals will often help to elucidate the best steps to take toward successful rental ownership.

For more information about this article, call 866-614-5959.

Why new appliances are a vital upgrade for rentals

Why new appliances are a vital upgrade for rentals

Landlords who are hoping to boost interest in their rental properties likely have a number of different avenues available to do so. However, experts generally recommend that one of the most impressive amenities for would-be tenants is newly upgraded appliances.

It may be helpful for rental property owners to think about upgrading appliances – which can sometimes be an expensive process, especially if they're swapping out more than one – to consider the big investment as an opportunity, rather than something they have to do, according to Rent Prep. New appliances are often a big selling point for potential renters because they're often more energy efficient, aesthetically pleasing and likely to come with more "bells and whistles" than the older models that could just be a bit worn out.

Understanding the appeal
If landlords are asking why upgrade the appliances in their apartments or rental homes – especially because they typically have no legal obligation to do so – perhaps the biggest reason to make the investment is that rentals with new appliances tend to command higher monthly rent payments than those that don't, according to One Rent. In this way, many appliance additions may be able to pay for themselves within a year.

Along similar lines, apartments that don't currently have certain types of appliances – washing machines, dishwashers, etc. – can often fetch a lot more than they would have without those options for tenants.

Another potential good reason to make the change to newer appliance is, if previous tenants were increasingly calling about problems with their refrigerators or to have their ovens fixed, those expenses and headaches can add up quickly, the report said. As a consequence, it might be wiser for property owners to swap these items out to save themselves the extra work of having to coordinate with repair technicians – or fix the problems themselves.

Similarly, experts also recommend that landlords purchase the warranties offered with their new appliances just in case anything goes wrong, the report said.

Getting it right
However, landlords also have to make sure they are striking the proper balance between attractive new appliances and breaking the bank to upgrade beyond what makes sense, according to Bigger Pockets. For instance, plenty of $3,000 refrigerators are on the market but go well above and beyond what's likely to be required to make a potential tenant feel good about moving in.

Generally speaking, it's wise to purchase appliances that are a little nicer than they necessarily need to be based on the hoped-for rental price, the report said. This approach will help apartments stand out from others in the price range, and therefore help ensure they are occupied soon after the previous tenant moves out.

A bit of research into the local market and what similarly priced rentals have available may help landlords get an edge on their competition and ensure they will be able to rise above renters' expectations for potentially years to come.

For more information about this article, call 866-614-5959.

How to help renters keep properties in good shape

How to help renters keep properties in good shape

One point of frustration for many landlords is the fact that their tenants may not always leave their living spaces in the same condition they found them. With this in mind, it might be wiser for property owners to take a different, more proactive approach to maintenance in which they work hand-in-hand with their tenants.

There are, of course, different legal responsibilities – which often vary by state – about what aspects of home maintenance are a landlord's responsibility, and what fall on the tenants, according to Rentec Direct. These rules are something with which landlords need to familiarize themselves so they can avoid potential legal issues, but also to work out a strong and effective division of labor with tenants.

Start off right
When new tenants move in, it's incumbent on landlords to ensure those people know what will be expected of them in terms of maintenance, the report said. Who brings the trash to the curb? Who shovels the driveway and sidewalk when it snows? Who pays for whatever repairs need to be made, and in what circumstances? These are all issues that may have some legal requirements around them, but can also be spelled out in a formal lease agreement.

But when it comes to vital home issues such as plumbing and heating, that's something tenants will need to use responsibly and safely but which they should not attempt to repair themselves, the report said. However, when it comes to smoke or carbon monoxide detectors, tenants may be required to replace batteries, but typically not the units themselves.

What else to keep in mind
When repairs do need to be made, and require either a landlord or someone they hire to show up and work within a tenant's living space, there are typically state-by-state requirements for providing notice of that effort at least 24 hours in advance, if not more, according to Find Law Real Estate. Likewise, most states require landlords to make repairs – especially when they affect the safety or livability of the space – within 48 hours of their tenants reporting the issues.

With that in mind, landlords should also endeavor to make it clear to their tenants that a big part of maintaining a property is being vigilant for anything that seems as though it's not in working order, and reporting it as soon as possible so that both parties can benefit, according to The Balance Small Business. After all, when small problems go unaddressed, they can often become big problems for both landlords and tenants. For property owners, those problems can be legal entanglements, whereas for renters they can simply make their daily lives a little less convenient – or even unsafe.

When tenants and owners know their responsibilities about property maintenance, and are vigilant and proactive about dealing with any issue as it crops up, all involved will be in a much better position to uphold a strong relationship going forward.

For more information about this article, call 866-614-5959.

The most sought-after rental property features

The most sought-after rental property features

When landlords are trying to make their properties attractive to would-be tenants, there may be plenty of avenues for them to pursue. For instance, some may choose to make big overhauls of the living space, while others are content add a few amenities and or new coats of paint.

Even simple renovations to a kitchen or bathroom can make a rental property a lot more attractive to potential tenants, but it's wise for property owners to assess what they might or might not like about the spaces they're renting out, according to The Balance Small Business. For instance, while a kitchen or bathroom remodel is likely to be popular, something that's a little simpler, such as redoing the flooring if there's well-worn carpeting could make a room feel new without having to gut it.

Other changes to make
Meanwhile, depending upon where the property is located, owners might also be wise to add some parking options if at all possible, so that tenants – or their guests – have safe places to put their vehicles, the report said. This is especially attractive if a reasonable accommodation for parking multiple vehicles can be made off the street. While this certainly isn't always possible in urban areas, making space in a yard for even one car or truck can significantly increase a property's rental value.

Along similar lines, any outdoor space – even a porch – can be another great amenity for renters to hang out when the weather allows it, according to Simply Business. Likewise, if there is significant storage space (such as a shed, attic or basement) on the property for people to utilize, they may be more likely not only to be attracted to a rental initially, but also potentially stick around for longer periods of time.

Simple additions
Furthermore, adding new appliances and swapping out old ones can be attractive because of how much easier they make tenants' lives, the report said. For instance, new, stainless steel appliances are likely to be impressive, but adding a dishwasher to spaces that don't have one can be a big boon for renters who don't want to devote hours every week toward doing the dishes by hand.

Likewise, any apartment that doesn't yet have a laundry area could become a lot more attractive with that simple addition, even if it's in the basement, coin-operated or the like, according to Rentberry. This, too, makes a tenant's life a lot easier because they don't have to go to a nearby laundromat at least a few times a month, which is a huge convenience to anyone who has an already-packed schedule.

When landlords are thinking about upgrades they can make to a rental property, it may be wise to think about the aspects of their homes that they already like, and how adding those features may help them surprise and delight tenants going forward.

For more information about this article, call 866-614-5959.

Rental repairs and renovations to maximize return on investment

Rental repairs and renovations to maximize return on investment

Many investment property owners may see the need to improve their units in today's increasingly competitive market, especially because of how much return on investment even a few basic upgrades can create over the long term. With that in mind, however, it's important to spot the differences between what constitutes a great return on investment and a more modest one.

Perhaps the biggest repair hurdles many landlords run into when it comes to boosting return on investment is putting off improvements until their underlying issues are exacerbated, according to real estate expert Ethan Roberts, writing for Auction.com. For instance, if landlords are slow to repair or replace a malfunctioning washing machine, its functionality is only likely to worsen, and could eventually cost significantly more to fix and potentially even cause more damage than just to itself (such as with leaks).

What to monitor
As the old saying goes, an ounce of prevention is worth a pound of cure, so getting out in front of any possible hurdle in this regard will help keep an owner's return on investment high, the report said. If a past tenant reported a leak in the ceiling, it's vital to get that problem assessed and fixed sooner than later.

Of course, many properties that get used by a rotating cast of tenants over time are likely to encounter the same difficulties, according to Bigger Pockets. Many of them relate back to plumbing issues that lead to drips from the bottoms of sinks or bathtubs, as well as from faucets, toilets continually running or spigots no longer providing hot water. Often, these repairs will cost little more than a few hundred dollars, even in the most extreme cases, but the fact that they may need to be made at all could be a sign of a potentially larger problem going forward.

These may be most important to monitor closely simply because of how much it can cost to repair water damage versus other types of fixes that may need to be made over time, the report said.

What to expect
In addition, it's also important for property owners to keep in mind that in many cases, they will be able to deduct the cost of one-time repairs from their annual tax liabilities, but that's not typically the case with improvements, according to Landlordology. When making improvements as a means of boosting a property's value, however, the deductions will be different because they are technically considered capital expenses that must be depreciated, evenly, over time. It's also important for landlords to be able to differentiate between what constitutes a repair – such as fixing a cracked foundation – versus an improvement – such as adding structures to an existing foundation.

With these issues in mind, it may be wise for landlords to do all they can to better understand what they may need to do to boost their return on investment and avoid repair-related pitfalls. A little online research in this regard can go a long way, but so too can efforts to be a little more proactive about these potential hurdles.

For more information about this article, call 866-614-5959.

These repairs have the biggest return on investment.

Repairs and renovations that offer the biggest return on your investment

People tend to invest in properties in one of two ways: as a rental unit or as an opportunity to "flip" it. In both situations, repairs and renovations can help increase the value of your home. While putting money into a building can be intimidating, these items have been shown to have the biggest returns on investment. 

Short-term investment properties
If you're looking to purchase a property and then resell it for a higher amount, there are some things that automatically increase the value of your home. Several major factors (location, square footage, yard space) can't be changed, but these repairs should make a difference.

  • Garage door replacement – Most people don't think of replacing their garage door until necessary, but a damaged, dirty or outdated door can detract from the appearance of your home, especially if you have an attached garage. Consider the neighborhood the home is in when picking a new door. Do most people seem to want more advanced features like an electric opener? If not, consider a traditional option for a mid-range home as these require less maintenance and are not as likely to break with extended use. It's estimated that a new door costs $3,470 and 98.3 percent of that will be recouped, according to Remodeling's Cost vs. Value Report for 2018.
  • Entry door replacement – When prospective buyers walk into a home, the front door will give them their first impression of the house. Having a door with scuff marks or worn paint can lead to a general feeling of decay. In addition to appearance, a sturdy entryway can give buyers a feeling of safety and protection. Experts suggest using a steel replacement, which may cost around $1,471. However, it's likely to recoup more than 91 percent of that cost in a future sale. To get even more bang for your buck, think about adding an electronic entry system or video doorbell that can be integrated into a smart home system. 
  • Minor kitchen remodel – Realtors are known for saying that kitchens and bathrooms sell a house. Instead of putting top tier appliances in, opt for mid-range options and paint the walls. Choose energy efficient appliances, solid countertops and a new sink for maximum value. This type of renovation should return over 80 percent of the money you put in. 
  • Accessible bathroom redesign – Residents with disabilities will appreciate an accessible bathroom. As the baby boomer generation ages, this is at the top of older buyers' lists since it may become relevant with age. This type of renovation can be accomplished with a widened doorway, a walk-in shower and reinforced hooks, racks and toilet paper holders. While one of the more expensive repairs on this list at more than $16,000, this will typically earn you a 70 percent return on your investment. Plus, if you're in an area that's popular with retirees, you may be opening up your home to a market you may not have appealed to before. 

Rental Properties
When renting a home to tenants, every dollar counts. You'll want to make sure to take in more money in rent every month than you spend on your mortgage and any relevant repairs so the house remains an asset and not a source of debt. To increase the rental value of a unit, you may want to promote features that appeal to renters including parking, location, public transportation and nearby conveniences. Some of the most important features in a rental unit that are in your control, according to a survey done by SmartMove, from most to least important include: 

  • High-speed internet – In some suburban and rural areas, it can be difficult to get a good internet connection which makes remote work and common activities like streaming videos difficult. Check the unit's internet speed ahead of time using a free speed-testing website and know where the connection falls compared to the national average. If it's slower than expected, reach out to competing providers and see if your building can be wired for alternative services. In multi-unit properties, it can also be worth the investment to have a building-wide internet connection with multiple access points so tenants don't need to set up their own services.
  • Walk-in closet – 89 percent of respondents look for a walk-in closet when viewing new apartments or homes. Storage is extremely important so adding closet space in a hallway, bedroom or large bathroom can be worth the small cost. There are also plenty of options for storage units at furniture stores that resemble built-in closets if you don't want to spend the money on a permanent change.
  • Soundproof walls – While soundproof walls are the third-most important feature to tenants, most people won't notice this during a walk-through of a unit. Make sure to point out any soundproofing when showing a rental property so renters are aware of the work you've done. Floors that muffle sounds are ideal, but may be more expensive. Carpet and rugs can also help with soundproofing and there are now decorative panels you can buy for wall and ceiling sound dampening. 
  • In-unit washer and dryer – Adding an in-unit washer and dryer can help increase rents right away. For smaller spaces, a stacked unit or an all-in-one washer/dryer might fit well. Make sure to get an extended warranty so you won't need to shell out cash for any repairs as that could detract from any increases in rent you earn with this improvement.