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Tips for Finding a Contractor You Can Trust

Tips for Finding a Contractor You Can Trust

Are you planning on having some work done on your rental property? If so, one of the keys to success with maintaining rental property for the long term that also produces consistent cash flow is finding a contractor you can trust. Thankfully, we got you covered with these 11 tips that will help you to connect with the right contractor.

1. Insist on a license.

Don’t accept excuses like, “I haven’t renewed my license yet this year” or “It’s pending.” All of these coverages ultimately protect you, the consumer, with vital safeguards like insurance requirements.

2. Ask for referrals.

One of the best methods for finding a contractor that you like is to ask your fellow property managers who they use.

3. Check with state or county authorities.

They’ll have a record of any complaints or revoked licenses. Keep in mind that any contractor who’s been in business for a while may have a few complaints; what you want to be wary of is a negative pattern on their licensing record.

4. Use a General Contractor Firm.

General contractor’s licenses are more difficult to get. General contractors are accustomed to carrying insurance that protects both them and you, the customer, against damage that may be caused by their subcontractors.

5. Anticipate problems.

Jobs may not be completed as planned for a few reasons: a scheduling error, inadequate manpower, insufficient materials, or an injury on the job site. If you enter each job prepared for the worst, you’ll be more resilient in the face of unexpected issues.

6. Get multiple bids.

This is about more than getting the best price. A variety of bids will set a price range, and set your expectations for how the work will be done.

7. Don’t automatically take the lowest bid.

The lowest price, though enticing, may be because the company is using subpar materials or illegal labor; or they may be skimping on workers’ compensation.

8. Don’t pay for bids.

Reputable contractors will get their fair share of work from their own bids, without you having to pay just to get them to consider your project.

9. Get proof of insurance.

Specifically, you want to see proof of sufficient general liability, contractors liability, and workers’ compensation insurance as a minimum.

In addition, make sure that the total coverage amount is adequate in proportion to the size of the job and the nature of the building. If it’s not, you should feel comfortable asking the contractor to purchase more insurance.

10. Verify liability coverage.

Errors and omissions in professional liability coverage comes in two basic forms: “occurrence” and “claims made.” It’s important to understand the distinction.

  • Occurrence: Provides coverage for any incidents or accidents that occur during the policy period, even if you don’t file the claim or issues don’t even become apparent until after the policy expires.
  • Claims made: These policies do not provide coverage after the policy has expired, unless the contractor purchases tail coverage.

11. If you’re a landlord, consider a surety bond.

A surety bond is a kind of insurance protection for the landlord. The contractor pays a sum to a bond company, and in the event that the contractor fails to perform, the surety bond company pays a sum to the landlord.

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For affordable and professional property management contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online.

 

Posted by on March 2, 2017 in Property Management Tips

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5 Basic Tips for Investing in Real Estate

5 Basic Tips for Investing in Real Estate

Are you planning on getting started with Investing In Real Estate during 2017? If so, you’re not alone. Thanks to the excellent returns from Real Estate many investors have chosen to invest in rental properties in Houston, and across the United States.

Before getting started with investing in Real Estate you should follow these 5 basic tips for investing in Real Estate.

1. Location Matters

The old adage that “location matters” is most accurate when it comes to real estate investing. Before you fork over a down payment and put yourself in a significant amount of debt over a property, ensure that it’s in a good location.

Look for the worst house on the best street. That’s a principle you’ll come across quite a bit as you delve into further real estate investing advice.

You want to invest in the worst house on the best street because it gives you an opportunity to build equity. It’s a property in a great neighborhood (“the best street”) that needs some work (“the worst house”). You can invest some money to fix it up and sell it to someone else who wants a ready-to-move-in house in a fabulous location. Professional real estate investors call this “fixing and flipping.”

2. Look for Wholesale Properties

Investing in real estate is just like investing in the stock market in at least one way: you’re looking for the best deal. If you’re a savvy stock market investor, you probably won’t buy too many stocks at their high if you plan on holding them for a long time. Instead, you’ll follow the Warren Buffet principle of getting greedy when everyone else gets fearful. You’ll buy stocks that are beaten down and make a fortune when they turn around.
That’s what you want to do when it comes to real estate investing. Avoid paying “full price” for properties. Instead, look for so-called wholesale properties that are offered at a steep discount. Sure, they’ll probably need some work. Run the numbers and see if the investment in rehab is worth the ultimate selling price.

As noted at ThinkConveyance: “You can easily invest $20,000 in a property and add twice that much to the selling price. That’s why real estate investing is so attractive to investors who want to maximize their return on investment.”

3. Understand the Tax Benefits
The people who run our government want private investors to provide housing for people. That’s because they know that if private investors don’t provide housing, then the government will be responsible for it.

To that end, Uncle Sam offers significant tax benefits to real estate investors. The most significant benefit, arguably, is the depreciation write-off. When you buy an investment property that includes a building, you get to write off the depreciation of that building as a tax deduction. You’ll have to consult your tax advisor for specifics, but basically you can expect to depreciate a residential building over 27 years and a commercial building over 39 and a half years.

Keep in mind that the IRS views your real estate investment efforts as a business so you also get to claim the “necessary and ordinary“ deductions that business owners take, including mortgage interest, insurance, and maintenance expenses. Again, it’s a good idea to consult your tax advisor about specifics.

4. Check Your Credit Report

You’re more than likely going to need to borrow money to buy real estate. That’s why you should check your credit report before you begin investing in real estate.

If you have problems on your credit report that are mistakes, get those resolved as quickly as possible. If you have problems that are legitimate, then you’ll need to work to improve your credit.

Simply put, banks aren’t going to loan money to you for a property that’s not your primary residence as readily as they’ll loan it to you for your own home. That’s why your credit has to be spectacular.

5. Use the “1% Rule”

If you’re planning on buying a property that you’ll rent out one or more tenants, use the “1% Rule” when you decide whether or not the property is worth the price you’ll pay for it.

The 1% Rule simply states that an income producing property must produce 1% of the price you pay for it every month. For example, if you’re looking at buying a property for $150,000, then the monthly rental income should be 150,000 x 1% = $1,500.

Get Houston Texas Property Management

As you grow your portfolio of rental properties you’re going to need an experienced Houston Texas Property Management company because a property manager will save you the time, money and hassle of managing those rentals yourself. Learn more about the services we can offer you by contact us today at (832) 971-1841 or click here to connect with us online.

 

 

Posted by on December 23, 2016 in Real Estate Investing Tips

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New 1099 deadline change to impact businesses

New 1099 deadline change to impact businesses

Every year, tax season brings a variety 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, regardless of method (paper or e-file). This significant change to the deadline, which was previously February 28 for paper and March 31 for e-file, will undoubtedly dial up workloads and stress levels for companies.

To further complicate matters, the new filing deadline, as it relates to Form 1099-MISC, only impacts filers reporting non-employee compensation payments in Box 7. Although the overwhelming majority of 1099-MISC filers will report information in Box 7, there is bound to be some confusion.

As you are likely aware, many filers traditionally provide recipient copies first and wait for employees or vendors to review the forms prior to sending them to the IRS. This approach has allowed errors to be corrected and the fixed form to be filed to the federal government, along a new copy to the recipient, without creating a corrected 1099. The new reporting deadline all but eliminates this option, which we expect to result in more corrected forms being sent this year.

To avoid filing late and incurring penalties for noncompliance, it’s important to plan ahead for these new deadlines, form changes, and other deadlines. We also recommend reviewing the required data as soon as possible to allow extra time to edit errors or gather further information if needed. Click here to learn more!

Get Houston Texas Property Management Here

Do you need Houston Texas Property Management? If so, contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online.

As long time property management professionals we can save you the time, money and hassle of managing your own rental properties especially when it comes to things like rent collection, maintenance, customer service and all of the other property management tasks that you might currently be doing yourself.

Let us show you the difference our services can offer you and how we can simplify your business so you can focus on growing your portfolio of rental properties in Houston, Humble, Kingwood and the surrounding area.

 

Posted by on December 15, 2016 in Income Taxes

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Are You Planning On Selling Your Houston Rental Before The End Of The Year?

Are You Planning On Selling Your Houston Rental Before The End Of The Year?

Over the last five years many homeowners in Houston Texas have decided to rent their homes out rather than selling them, but times have changed, and now that home values have increased, homeowners who were previously underwater with their mortgages have equity again and may be planning on selling their Houston Rental Properties. 

Thanks to the IRS tax code we know that you can temporarily rent your primary residence without losing the all-important exclusion of capital gain but, this is also based on set five-year time limit.

About The Capital Gains Exclusion

During a 5 year period of time, you must have done the following:

  • Owned your home for 2 years.
  • Lived in your home, as your primary residence for two years.
  • Ownership must have been continuous during this period of time.

To successfully take advantage of the capital gains deduction your home must be ready for sale and should be priced correctly, sold then closed within a period of six months.

Although most homeowners want all capital gains to qualify for the exclusion, the reality is that some of the gains might not qualify if depreciation has occurred during the period of time that the home was rented, but the good news is that depreciation is recaptured at a tax rate of 25%.

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Timing Is Important

As with anything in life, timing is important, especially if your home is valued at $200,000 or more because it’s possible that you could have a tax liability up to $30,000 so like most people you will want to do everything possible to minimize or eliminate as many taxes as possible.

To learn more about taking advantage of the capital gains exclusion contact you tax professional today or to start the process of selling your Houston Rental before the end of the year click here.

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For professional property management for your Houston Texas Rental Property contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online.

 

Posted by on December 9, 2016 in Real Estate Investing Tips

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Should you buy rentals in Houston? Even if you’re out of the area?

Should you buy rentals in Houston? Even if you’re out of the area?

Thanks to the booming real estate market in the last 12 months there are more condos, town homes and apartment buildings available for purchase and rent than ever before but the big question is should you buy rentals in Houston even if you’re out of the area? The answer to this question is yes!

Pros of Buying Long-Distance Real Estate

  • The ability to buy in more affordable markets. Property values in second- and third-tier markets don’t command the premium of real estate in primary markets and there’s lower competition. That said, depending on the market, rents can still be very strong. Buying in one of these markets is a way to get your foot in the door, realize positive cash flow and build equity.

  • Real estate as a long-term strategy. Some investors decide to buy real estate in an area that they don’t currently live in, but think they might want to someday. For instance, I’d consider buying a home closer to my parents if there’s a chance I’ll want to live closer to them someday. Many investors use a similar mindset when considering real estate in vacation and retirement markets, like the Carolinas and Florida. These houses can be rented now and held in case an investor wants to live there someday, too.

  • Tax benefits. Say what you want about Trump, but when the New York Times released a copy of his 1995 tax returns it shed light on a stark reality: real estate investors are able to use the tax code to their advantage. The ability to write off interest paid on a mortgage and depreciation makes buying investment property highly attractive. The provision Trump took advantage of is no different than the loopholes that everyday investors use, too.

Get Houston Texas Property Management Here!

For affordable Houston Texas Property Management contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online.

 

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Posted by on November 23, 2016 in Property Management Tips

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1031 Exchange Tax Free Real Estate Investing

1031 Exchange Tax Free Real Estate Investing

Are you planning on investing in another Houston Texas Rental Property but have to sell one of your rentals first before you can purchase the new property? If so, you should consider a 1031 exchange.

In this video you will learn more about how the 1031 exchange works and how to apply this to your business.

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For affordable Houston Texas property management contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online. 

 

Posted by on September 22, 2016 in Property Management Tips

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Houston Texas Rents to Flatten in 2016

Humble Texas Renter

HOUSTON, TX. – After months of rent increases thanks to the booming economy many experts are predicting that rents will start to flatten out in 2016 and the rapid increases that we’ve seen over the last 12 months will soon become a thing of the past.

This is good news for the Houston Rental Market since the area has certainly been hit hard since the drop in oil prices but the question is will slower rental appreciation actually help renters since rents have been increasing faster than incomes over the last 24 months?

National median rent at the end of 2015 was $1,381, and is expected to increase slightly to $1,396 over the next 12 months.

The slowdown in rents means that, by the end of the year, they will be rising at a slower pace than incomes in many markets.

In December, home values rose 4 percent to a Zillow Home Value Index of $183,500.

Rent appreciation will level off over the next 12 months, slowing to an annual rate of 1.1 percent by December 2016, according to the new Zillow® Rent Forecasti. The national Zillow Rent Indexii at the end of 2016 is projected to be $1,396 — compared to $1,381 in December 2015.

Zillow is forecasting a decrease in the rate of rental appreciation amid a rental affordability crisis that has renters in some markets spending almost half of their income on rent.  Some of the fastest growing metros had double-digit annual rental appreciation at the end of 2015.

Zillow expects rental appreciation to slow down most significantly in Nashville, Tenn., San Francisco, Portland, Ore. and Denver. Rents in San Francisco saw 12.5 percent appreciation in 2015. Zillow forecasts rent in San Francisco will grow half as fast in 2016 — 5.9 percent.

Even with the slowdown, rents will remain unaffordable in many of the major markets across the U.S., especially on the West Coast. Renters in San Francisco and Los Angeles can expect to spend 40 percent of their income on a rental paymentiii.

“Hot markets are still going to be hot in 2016, but rents won’t rise as quickly as they have been,” said Zillow Chief Economist Dr. Svenja Gudell.

“The slowdown in rental appreciation will provide some relief for renters who’ve been seeing their rents rise dramatically every single year for the past few years. However, the situation remains tough on the ground: rents are still rising and renters are struggling to keep up.”

The slowdown in rental appreciation indicates that supply of new multi-family homes is catching up to demand. Substantial new housing supply is becoming available in Atlanta, Denver, Portland, Seattle, and other markets.

The Zillow Home Value Index rose 4 percent year-over-year in December 2015, to $183,500, according to the Zillow® December Real Estate Market Reports.

Source – rentalhousingjournal.com 

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For more information about the Houston Texas rental market or for Houston Texas Property Management contact Vestpro Residential Services today by calling us at (832) 498-0016 or CLICK HERE to connect with us online. 

 

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Should You Make Improvements To Your Houston Rental This Year?

Vestpro Residential - Houston Texas Property Management

Your tenant just moved out of your Houston Rental Property and after doing the usual painting, carpet cleaning and other duties that you would do after a tenant moves out you’re starting to wonder if now would be a good time to do some renovations to your rental property because you would like to rent your property for more money.

In this post we will share with you the top 5 renovations you should consider making to your Houston Rental that will not only increase the value of your property but also enable you to rent it for more money.

Renovation #1 – Improve The Bathrooms

Since we all spend more time in bathrooms then we do in kitchens you should first consider investing some renovation money into the bathrooms in your rental property.

Bathtub – If your Houston Rental Property has an old shower / tub combination consider having that removed and replaced with just a stand alone shower or a soaking “garden tub”.

Sink – Consider replacing the bathroom sink with either a Jack and Jill style sink (depending on bathroom size) or if it’s a smaller bathroom you should think about replacing the old sink with a pedestal sink since these sinks economize for space and look stylish.

Flooring – Remove carpeting from the bathrooms in your rental property and replace with vinyl or slate flooring.

Tile – Although the tile in your bathrooms may still look in good shape the reality is that tile grout does carry bacteria depending on the age of the tile. You should consider having the tile regrouted and repainted or replace with another surface.

Renovation #2 – Make Some Improvements In The Kitchen

Sadly, many people who own rental properties in Houston and across the United States make the mistake of going “overboard” with their kitchen renovations.

To save you money in the ktichen here are some renovations you should consider:

Cabinets – Instead of replacing the kitchen cabinets you should sand them down and resurface or repaint them.

Knobs and Handles – Replace hardware on kitchen drawers and cabinets with new hardware.

Flooring – Save money on the flooring in your kitchen by replacing it with vinyl, slate or bamboo flooring.

Renovation #3 – Improvements For The Bedrooms

Since the bedrooms in most rental properties are “dark and dingy” you should consider adding more lighting in each bedroom like ceiling fans or recessed lights. It’s also a good idea to consider increasing the closet space in bedrooms as since closet space is what most renters will be looking for when they are viewing a rental property.

Renovation #4 – Work On Curb Appeal

Last of all, but most important, another great renovation that you can make to your Houston Texas Rental Property is improving the curb appeal.

Curb appeal is important because it’s what motivates renters to get out of their vehicles to view the inside of your property so if your rental has curb appeal that’s somewhat lacking you should consider making some curb appeal improvements by doing the following:

  • Add sod or grass in the front yard.
  • Paint any fencing that you may have in front of your home.
  • Remove trash, debris or garbage.
  • Replace your old mailbox.
  • Paint your front door.

Get Property Management For Your Houston Rental

To get property management for your Houston Rental contact Vestpro Residential Services today by calling us at (832) 498-0016 or CLICK HERE to connect with us online. 

 

 

 

Posted by on February 16, 2016 in Renovations

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Houston Texas Property Management Tips – Four Things To Consider Before Increasing Rent

Houson Texas Property Management

In this issue of Houston Texas Property Management Tips we will cover the sometimes complicated issue of rent increases and we will offer you several tips you should consider before raising the rent at your rental property.

Tip #1 – Think About The Economy

Even though you’re ready to increase the rent because it’s a new year it’s important to keep in mind what’s happening with the overall economy in Houston because thanks to the recent drop in oil prices you could see more vacancies if you decide to raise the rent now at one or mor eof your rental properties so it’s best to use caution before moving forward with a rent increase.

Tip #2 – Analyze What’s Happening In The Neighborhood

Take a moment to analyze what’s happening in the neighborhood including if any new shops, stores, restaurants or amenities were built nearby in the last 12 months because added amenities or attractions can help to increase the demand for rentals. 

Tip #3 – Determine The Correct Rent Increase

Although some owners might advice a blanket rent increase across the board the reality is that what’s working for one property owner might not work for you at your Houston Texas Rental Property so it’s best to calculate your rent increase carefully while taking into account your increased expenses for city water, sewer costs and property taxes.

Tip #4 – Give Your Renters Plenty Of Notice

For best results with rent increases consider giving your tenants at least 115 days before their leases are due to expire and in your notice to them you should also include a breakdown of the moving costs they can expect to pay if they decide to move elsewhere because some tenants might not really be aware about the cost of moving vs. renewing their leases until they see the cost breakdown in front of them.

Get More Houston Texas Property Management Tips

For more Houston Texas Property Management Tips, or to speak with us about managing your rental property, contact Vestpro Residential Services today by calling us at (832) 971-1841 or click here to connect with us online. 

 

 

 

 

 

 

Posted by on February 16, 2016 in Rent Increases

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8 Rental Upgrades That Will Pay Off At Your Houston Texas Rental Property

Houston Texas Rental Property

By Vestpro Residential Services

HOUSTON – As a property owner one of the most important things that you should be focused on is upgrading your Houston Texas Rental Property each year because investing money into your rental property will help you establish a relationship with long term tenants while improving the value of your rental property.

In this post we will share with you 8 rental upgrades you should consider making to your Houston Texas Rental Property.

Upgrade #1 – Improve Landscaping

It doesn’t matter if you own a big or small Houston Texas Rental Property you should improve the landscaping / curb appeal of your property because this will increase the value of your property and motivate your tenants to take care of the rental better.

Upgrade #2 – Replace the Front Door

There’s no denying that adding a new front door that’s aesthetically pleasing will help your rental to stand out from other properties in the area but it will also add another element of safety to your home since newer front doors are made from steel and harder to damage or force open than older front doors.

Upgrade #3 – Repaint Your Rental Property

Adding a fresh coat of paint to the interior and exterior of your rental property in Houston Texas will also help to increase the value and attractiveness of your rental because a coat of paint helps to freshen up a rental, makes the walls appear to be brighter and removes the signs of previous tenants like holes in the walls, scuff marks and damages that the walls may have sustained over the years.

Some of the other improvements that you should consider making to your rental property include:

4. Upgrade Your Appliances

After your old tenants move out, you’ll discover the quirks of the appliances in your rental property. You may discover that a tap has a slow leak or that a dishwasher only works when it’s on a particular setting. While regular maintenance programs can catch these issues before your tenants leave, you’ll need to make an extra effort to repair them before new tenants come into the property. New appliances, repaired appliances, or quality secondhand appliances give the impression that you’re willing to make an investment in your tenants’ comfort.

5. Add New Shutters or Curtains

Many homes have shutters and curtains that go with the house, and while it’s tempting to avoid changing these to save some money, older curtains or shutters can really date a property. Clean shutters or window blinds or replace them if they are broken and twisted. While new window coverings are not expensive, replacing windows can be pricey. However, if a window is aging and drafty, adding a storm window in its place can add value to the home.

6. Shed a Little Light

A well-lit room not only says that you have good lighting, it also sheds light on the beauty of the home that you’re renting. Choose lighting that’s bright but appropriate for the room: soft lighting in the bedrooms, bright lighting in the kitchen. Clean out lighting fixtures, change bulbs, and update the fixtures if they’re broken.

7. Restore Your Floors

A new floor is a large investment, but the payback can be worthwhile. It can transform the look of a home from dingy carpet to stellar hardwood. New flooring can make a room grow up, and it makes everything look cleaner as well. If you can’t afford to install new floors, restore old ones when you can. Old wooden floors can be refinished with a new shine. If you need to focus on a single room, the kitchen or bathroom is the place to start with flooring upgrades.

8. Keep it Clean

LegalZoom says that sometimes, the cheapest and most dramatic improvement you can make on a rental property is simply cleaning it up. When your old tenants move out, make sure that you welcome prospective tenants into a home that’s been thoroughly cleaned. Hire a cleaning company to go through the home and remove spider webs, wipe down walls, and deep clean the house entirely. This makes a home much more welcoming and adds to the price that tenants are willing to pay.

Source – Propertyware.com

Rent Your Houston Texas Rental Property

To rent your Houston Texas Rental Property contact Vestpro Residential Services today by calling us at (832) 498-0016 or click here to connect with us online

 

Posted by on February 2, 2016 in Property Management Tips

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