Saturday, November 18, 2017

Mayor-Elect Announces Her Transition Team

RD House has proudly been a member of the Greater Seattle Business Association (GSBA) for 11 years (18 years with our previous business affiliation), and we're proud to see GSBA CEO Louise Chernin will join Mayor Durkan's transition team as part of the Business coalition.  We know Louise will serve well representing Seattle's small business interests!

Tuesday, October 17, 2017

Onslaught of new units coming on market beginning to dampen rents, increase vacancies

We've watched all the cranes around Seattle, now we're starting to see the effects.  A new report by Dupre + Scott Apartment Advisors of Seattle shows the apartment vacancy rate in the city of Seattle has hit a seven-year high and is growing faster than anywhere in the Puget Sound region.

The report analyzed information for 252,552 units in 2,428 properties (with at least 20 units) in a survey that ended Sept. 21, and shows a 4% vacancy rate for the Seattle market, up from 3.3 percent in March. (Vacancy rate excludes new properties that are still in lease-up).  The gross rate (which includes new units) is 6.8 percent, up from 5.1 percent.

As a region, Puget Sound’s gross vacancy rate exceeded 5 percent for the first time in four years, at 5.4%, up from 4.8% percent this spring.  Climbing vacancy rates are slowing down rent increases across the region- rents are up 7.8% from a year ago, when Dupre + Scott said rent growth peaked at 9.2%.

Given this new data, investors should expect the rental market to soften over the next couple of years, as developers plan to open 62,000 rental units between 2018 and 2020. That is in addition to the more than 12,000 new units expected to open this year and 14,500 units in the tri-county area next year in King, Pierce and Snohomish counties.

Unit demand in the tri-county area has averaged 9,000 units a year over the past three years, and in the past 12 months has totaled just under 7,500 units. A year ago demand peaked at 10,500 units, so given this kind of supply hitting the market, investors should plan for higher vacancies and fewer rent increases.

Wednesday, August 9, 2017

City Council approves legislation to prevent landlords from considering applicants’ criminal records

5/1/18: As an update to this info, as we'd suspected, The Rental Housing Association of Washington says it filed a lawsuit in King County Superior Court Tuesday.  The complaint alleges the city has violated property owners' due process and free speech rights. It says landowners have a right to select their tenants and the ordinance is burdensome and unreasonable.

Landlords will be limited in screening tenants based on criminal records, under an ordinance the Seattle City Council approved in August.  When taking applications, they will be barred from asking about records. And in choosing tenants, they will be barred from rejecting people due to their records.

The only people who may be denied rental housing will be those listed on sex-offender registries because of adult convictions, and landlords denying housing to such people will still need to demonstrate a legitimate business reason for doing so.

Landlords renting part of their own homes and sharing a kitchen or bathroom with a tenant will be exempt, as will primary leaseholders given the authority by landlords to choose roommates.

In most states including Washington. landlord responsibilities include protection of their tenants and impose a legal duty on the landlord to take steps to protect their tenants from criminal activity. The best means to reduce the likelihood of being held responsible for the criminal acts of tenants is to perform a thorough credit, background and criminal screening of all applicants when renting out a property. As a result of this conflict of purposes, we suspect this legislation may face legal challenges.

Sunday, July 16, 2017

5 Tangible Money-In-Your-Pocket Benefits of Using a Technology Oriented Professional Property Management Company

Technology oriented seattle property management
Being a landlord is much more than handling tenant turnovers or overseeing rented units and tenants. Thorough property management (and the underlying investment/asset management) also covers consultancy, market insight and knowledge, tax reporting, accounting, effective marketing, leasing paperwork, legal and legislative compliance, document management, property inspection and prospective tenant assessments. All this can be overwhelming for any individual, especially landlords who still have to chase their monthly checks from tenants.

That’s why many property owners turn to professional property management services (or should, if they don’t), who are licensed real estate brokers, and skilled in managing all these needs. But more than just that, property managers who are adept with technology can get more done, and more effectively, and as the saying goes- time is money.  Specifically, smart use of technology can mean fewer days vacant, more competitive rents, faster rent collection cycles, more timely vendor payments and most importantly (to property owners), faster funds disbursement each month.

Here are 5 tangible advantages of hiring a professional property manager well versed in technology to manage your needs effectively.

seattle property management online advertising reach
Rental syndication enables broad advertising reach
while professional photos and virtual tours drives

1.  Online advertising reach

A major benefit of tech savvy management professionals are the listing features we leverage, allowing us to broadly and effectively market rental units, by syndicating listings to highly trafficked listing platforms (such as Trulia,  Zumper,  Zillow,  HotPads and  many others)- and in doing so, providing professional listing information, photos, videos and virtual tours.

2. Valuable landlord and tenant tools/services

Seattle property management landlord tenant tools
Effective professional property managers also develop platforms that cater to specific needs and portfolio profiles.  For example, here at RD House, our management platform allows us to do things like assign utility bills to tenants in single family properties, and to apportion utilities across multiple units in multiplex properties.  At the same time, all of our clients and tenants have access to online payments/deposits and personalized web portals with lease documents, bills, financial reporting, account transactions, communications and more.  We also provide real-time 150-point photo documented move in and move-out inspections.  Because we leverage the platform across all our properties, we’re able to provide them much more inexpensively than an individual landlord could.

3.  Marketing muscle

Seattle property management marketing
This is the real strength of professional property managers.  In addition to advertising rentals on high traffic platforms, social media savvy professional managers syndicate listings to social media, and RD House has working relationships with corporate relocation and employer housing professionals.  We also know what property/unit amenities and features are most desirable and how best to market properties/units based on their specific attributes.  

This alone has a very tangible payback for our clients:  our average vacancy (days vacant on market including turnover) is just 22 days.  That means your property is generating rents more days in a year.

4. Legal and legislative compliance

landlord tenant law complianceWashington state, King County and cities within the Seattle Metro all have landlord/tenant and rental property regulations and requirements, ranging from tenant screening criteria, security deposit handling, rental property registration and inspection, maintenance response and mitigation requirements, and much more.  Professional property managers provide a wealth of experience and skill in effectively navigating these, and often belong to industry groups that keep them engaged in the latest information.  At RD House, for example, we’ve helped our clients understand and navigate an unprecedented wave of new or amended Seattle rental regulations, including the RRIO (Rental Regulation and Inspection Ordinance), First in Time Tenant screening and acceptance requirements which went into effect on Jan 1, 2017, and caps on move-in fees (which the Seattle City Council passed in January 2017, despite RD House lobbying against this alongside other industry leaders)- nonetheless, our software platform easily tracks and manages  the extended period payment options which this legislation mandates, inline with our leasing and tenant accounting processes.

5.  Customer Service

seattle property management customer service
The importance of customer service for any business can’t be over emphasized. When people receive great customer service from a business, a ripple effect happens through word of mouth and recommendations. In the property rental arena, satisfied tenants stay longer and renew more often, saving a significant amount of turnover and vacancy costs.  RD House has one of the highest tenant retention rates in the market, and has been awarded excellence in property management services since 2014, driven by our client and tenant service, flexible and mobile-enabled tenant and owner portals, ePay and direct deposit services and online maintenance request tools.

RD House is a Seattle property management company that specializes in property management for residential homes and small apartment buildings in the Seattle metro area. We work smarter to be a team you can trust to manage all the aspects of your real estate property management the right way, and our mission is simply to provide better results with residential, multifamily, commercial and association property management.  We call it Simply Better Property Management.

Tuesday, May 30, 2017

Seattle named #5 top U.S. city for corporate innovation, R&D

Innovation Leader, a magazine and website focused on innovation in large companies, today released its 2017 list of the top North American cities for corporate innovation and R&D activity, with Seattle appearing at No. 5.

Topping the list is San Francisco/San Jose, Calif., with Boston, New York, Los Angeles, and Seattle rounding out the top five. 

The Innovation Leader list is unique among "city rankers" because it focuses not on startups, entrepreneurship, or venture capital, but the amount of research-and-development and innovation activity that big companies do in each city — whether that’s Disney and other studios developing the future of entertainment in L.A., or Ford, Uber, and Toyota working on self-driving cars in Detroit.

Specifically, the list takes into account five factors:

1) Global 1000 companies with R&D labs or innovation centers, and their R&D investment levels

2) Major tech companies with large R&D or development partner ecosystems

3) Startup density, including accelerator programs, incubators, and co-working spaces

4) The presence of top-tier research universities

5) Conferences, trade shows, and networking events that foster interactions among corporate executives, entrepreneurs, and academic researchers

See the full story here

Breaking story: RHA leads landlord court challenge to move-in cost installment requirement

Seattle landlords on Tuesday sued the city over a law requiring them to allow tenants to pay move-in costs in installments. The move represented the latest pushback from property owners against a series of new city policies protecting renters.  “Our members provide safe and affordable housing," Sean Flynn, board president at the Rental Housing Association of Washington, said.

The 5,400 landlords represented by RHA "set the standard for ethics and best practices in our industry," Flynn said. "Yet, this city council has never missed the chance to lambaste, demonize, and hold landlords responsible for problems they did not create.”

RD House is an Affiliate member of the RHA.

The RHA took the city to court today, seeking to block a law the Seattle City Council approved in December, which requires landlords to allow tenants to pay their security deposits, fees, and last month's rent over the course of a payment plan. The law, which passed unanimously under the sponsorship of city council members Kshama Sawant and Lisa Herbold, also caps the total amount of security deposits and nonrefundable fees landlords can charge at no more than one month's rent. Nonrefundable fees can't exceed 10 percent of one month's rent unless the cost of the tenant's screening report exceeds that amount.

Josh Whited, the lawyer representing the RHA, called the requirements "onerous." He argued the law violates the state ban on rent control, constitutes an illegal "taking" of private property, and violates landlords' due process rights.

Court precedent in Washington, Whited said, has found that “local governments are not entitled to shift the burden for solving societal problems to individual property owners.”

We will follow this story with updates as they develop.

Friday, May 26, 2017

2017 GSBA Scholarships

RD House is proud to be a member of the Greater Seattle Business Association (GSBA), which understands that today's students are tomorrow's leaders and is committed to supporting our community's future leaders by providing financial resources, role-models and hope to outstanding LGBTQ and allied students. This year, GSBA is proud to have awarded its 3 millionth dollar through its scholarship programs!

At the 2017 dinner on May 19 Hearts were bursting with pride as over 500 guests including scholars, donors, community leaders and elected officials gathered to witness history as GSBA gave out its $3 millionth dollar in scholarships awarded since 1991.

This Fund, and the hope it provides, has changed the lives of over 500 LGBT and allied students but, perhaps the biggest game changer is the launch of the GSBA Guarantee. The Guarantee promises up to four years of support to GSBA Scholars as long as they continue their part by doing their best in school. This extraordinary commitment is possible because of you, and your understanding of the power of education to change lives.The exciting news continued as long-term GSBA member and Antioch Board member,Steve Crandall, came on stage to announce the GSBA Leadership Academy, an innovative leadership experience created through a partnership between Antioch and GSBA with support from Microsoft and input from several GSBA donors. This Leadership Academy will hold its first immersion weekend this August at Islandwood Retreat Center on Bainbridge Island during which all 45 scholars will be brought together to go through a three-day leadership curriculum.

Sunday, March 19, 2017

Pair of recent Tech employment reports tracks Silicon Valley to Seattle migrations

For decades, Silicon Valley has been the epicenter of the tech industry, and  it’s easy to understand why: Silicon Valley hosts many of the world’s most successful tech firms including Apple, eBay, Facebook, Google, Netflix and PayPal. These firms offer employees prestige, high salaries and opportunities to work on cutting-edge projects. In addition, there are thousands of startups in Silicon Valley to attract those who want to build something from the ground up.

Tech salariesBut the recent Hired-State of US Salaries report outlines the rise of new technology and innovation hubs across the US- including Seattle- and the world are challenging the Bay Area’s reign. In fact, after adjusting for cost of living in San Francisco, cities like Austin, Melbourne, Seattle, and Toronto are increasingly attractive spots for tech workers to grow their careers.

And in their Digital Exodus article, Indeed .com uncovers a bit about why experienced tech workers are searching for, and moving to, jobs outside Silicon Valley.  Their recent analysis of Indeed job search data reveals growing numbers of Silicon Valley tech workers between the ages of 31 and 40 are searching for work elsewhere. 

This report also calls out the cost of living as likely a major contributing factor. To take just one measure: according to a real estate brokerage, the median sale price of a home in Silicon Valley is $1,050,000. Sky-high housing costs are driving what is described as a “digital exodus.”
Whether or not the situation is quite that dramatic, Indeed data confirms not only that tech workers are searching for work in other hubs but shows us precisely where they are looking.
Seattle is one of the key engineering hubs to which they are migrating (the Puget Sound Business Journal said of the Hired report that Seattle is the top landing spot for tech transplants from Bay Area, which is hard to see directly from the data in their report, and the Indeed posting puts Seattle at #5 in terms of search location (not actual work migration).
Tech job migration

For Seattle Property Managers and rental property owners, the implications are clear:  a steady stream of tech workers who will be looking for housing here.  The key, however, will be in offering units and amenities that will meet their needs.  We'll be looking that those factors in upcoming posts here, so stay tuned.

Friday, February 10, 2017

Seattle caps move-in fees in attempt to abate affordable housing crisis

Effective January 15, the Seattle City Council approved legislation capping move-in fees at the first months rent plus no more than that for any move-in related deposits.  Renters will be able to opt for payment of move-in costs above this (such as last months rent deposit) over a 6 month payment plan. 

Historically, landlords could charge security deposit, last months rent and pet deposit  fees up front before a tenant could move in. Now, combined move-in fees cannot exceed the equivalent of the first month’s rent. The ordinance also forces landlords to accept additional payments in installments, allowing tenants to pay gradually over a period of six months if they cannot afford the fees when they first sign the lease. Landlords are now also limited in how much they can charge for pet deposits: No more than 25% of one month’s rent (and payable over a 3-month payment plan).

RD House is fully prepared to work with these new requirements and are able to collect Last months rent and pet deposits in installments.  There is an administrative cost to billing, tracking and collecting installment payments, and we will have to charge a $9.95 per month fee to owners when tenants request this option (but only during the period of installments).  We generally would pass tenant-related costs like this to tenants, however the council legislation specifically prohibits doing so.

Seattle Landlords Push Back
Seattle landlords disagree, arguing that the new ordinance is an overreach of local authority.  RD House agrees with this pushback and lobbied against these new provisions with our local councilmembers and with the Mayor. 

“I am offended by the city [telling] me that I cannot protect my own investment,” said Chuck Cady, a local landlord.  Lizbeth Lyles, another landlord, echoed that sentiment. “I’m feeling a little under attack by the city council. Putting all these restrictions on the landlords is not the solution. It’s just going to make us sell the properties.” This could lead to units being purchased, renovated, and re-listed for rent at even higher prices.

Other landlords warned City Councilors to prepare for the unanticipated consequences of the new ordinances. Landlords will simply shift to risk mitigation by increasing rents or increasing the tenant screening criteria to favor more financially stable residents.  RD House will advise our owners on a case by case basis if the restrictions pose risks that require consideration.

Tenant Protections in Other Markets
Seattle isn’t the first city to adopt new legal protections for tenants in the wake of growing concerns over housing affordability.

Just last year, we highlighted an ordinance passed by the San Francisco City Council that made it harder for landlords to initiate no-fault evictions against educators employed by local schools and childcare centers. In September, a San Francisco Superior Court judge ruled that the ordinance was in conflict with state law, and the city had to revoke the policy.

Other cities have implemented new inclusionary zoning policies that require developers to reserve 20% of all new units for affordable housing.

Whether these policies will actually make a dent in the affordable housing crisis remains to be seen. If so, we suspect that other cities will follow suit by implementing new landlord-tenant policies of their own. It is important for landlords and property managers to monitor these proposals closely, weighing in at local hearings as appropriate.

Saturday, January 28, 2017

The importance of good move-in inspection documentation

By far the largest source of resident/landlord disputes is the disposition of the resident’s security deposit.  Using proper move-in and move-out documentation procedures is the best tool to protect you and your residents from these kinds of disputes.  

With clear documentation on condition at possession and at move-out, and provisions in the lease that specify expectations and responsibility, you will have an objective baseline for the entire residency.  It can also demonstrate to the residents satisfaction that at move-in, the property is in good condition and any general wear and tear exceptions are noted and agreed.

Even more, with mobile and cloud tools readily available today, landlords can perform detailed inspections with room-by-room condition, photos and notations that can be signed onsite with the tenant in just minutes, with a documented report file that’s saved with the lease information.  These save time and add much detail to the inspection report.

Thursday, January 19, 2017

If you're thinking of selling, check out these stats

The average sale price for Condos in West Seattle -December 2016

If you're thinking of selling this year, stay up with the stats, with RD House Real Estate.

Sunday, January 8, 2017

A first look at property management news in 2017

The new year is still taking shape, but there are already a few notable items rental property owners should be aware of.

1099 deadline changes

Tax season always brings a mixed bag of changes from forms to regulations, and this year is no exception.  Beginning in 2017 (for the 2016 reporting year), many important deadlines will change. Filers  will be required to send 1099-MISC recipient copies and submit the forms to the IRS by January 31, 2017 for both paper and e-filings.  Previously, recipient copies (copy B) were required by January 31, but companies had until February 28 for paper and March 31 for e-file for reporting to the IRS, allowing some additional time for review and any corrections.  However, the new 1099-MISC filing deadline only impacts filers reporting non-employee compensation payments in Box 7, and rental property income is reported in Box 1 (Rents) and Box 3 (Other income).  
For the 2016 filing year, RD-House will be using e-filing for both recipient (property owner) and IRS forms, and will, as we have in the past, report, audit and deliver these by January 31.

New or pending City of Seattle rental regulations

The City Council remains busy proposing and implementing various rental regulations.  

  • The RRIO (Rental Regulation and Inspection Ordinance) was fully implemented as of 12/31 2016, meaning that all rental properties regardless of location or the number of units are now required to be registered with RRIO.   RD-House completed registrations for managed units in 2016, and now have RRIO as a checklist item for onboarding new managements.
  • First in Time Tenant screening and acceptance requirements went into effect on Jan 1, 2017.  This requires acceptance of the first submitted and qualified application for a unit or property.  RD-House has clear acceptance and denial criteria for applicant screenings, and had always operated under this general rule, do we don't forsee any specific impacts with this for our managed properties.
  • Caps on move-in fees (pending vote) at no more than one months rent, in addition to the first months rent.  We are monitoring this item as it is debated by the City Council.
  • Limits on the use of credit, evictions and foreclosure information as screening criteria. This is only proposed at this point, and final legislation and process have not yet been determined.  We are closely monitoring this item as it is debated by the City Council.

Review your annual maintenance checklist

The beginning of the year is a good time to review and plan your property maintenance needs.  For example, individual units should be freshened during a turnover: consider what your painting, re-carpeting, countertops, or appliances might need to be upgraded. Doing this on a regular basis offers a huge perk: You probably won’t be scrambling to replace a conked out furnace in the dead of winter if you’ve been having it cleaned and serviced each fall.
Remember that some maintenance steps are required, according to city or state guidelines.  In Seattle, the RRIO inspection criteria are a good guide.  In addition:

  • Paint common areas every five to seven years. When they start to look worn and paint starts to chip or wear off, or has an uneven sheen, it’s probably time.
  • Re-carpet hallways and other shared spaces every five years. This is about the time carpet will start to unravel and become a tripping hazard.
  • Change light fixtures (not just bulbs) every 10 years or so. Quality fixtures can last for years, but many older ones aren’t compatible with new LED bulbs. Most buildings don’t tend to change the fixtures, however, until it’s time to repaint.
  • Clean the exterior annually, and look for paint or siding wear that may indicate additional maintenance.
  • Clean and inspect downspouts, gutters, and other water-related features annually. Either in the fall when leaves are falling or in the spring after trees flower to avoid debris getting clogged and causing backups.
  • Service and repair furnaces, water heaters and other major systems annually. Check or replace filters, etc. 
  • Touchup landscaping seasonally. Curb appeal is everything: invest in your outdoor plants every season to keep your property looking its best.