1Q 2016 Rental and Sales Review

As first quarter 2016 (Jan, Feb, Mar) came to a close, it was clear that early 2016 has been strong for both landlords and home sellers.

Rental Marketnational vacancy rate

Vacancy rate is the percentage of unoccupied or vacant rentals of the total number of rentals in a designated market. It’s a common metric to measure the strength of the rental market. The U.S. Census Bureau reports that the national rental vacancy rate closed at 7.0% for 1Q 2016. That rate has stayed fairly consistent over the past year, but the blue graph to the right shows how low the monthly vacancy rate is compared to the past seven years. So, what does a low vacancy rate mean for investment property owners? When vacancy rates are low, rent prices rise as tenants scramble to find properties. The red graph to the right shows that March 2016 had the highest median monthly rent in Minneapolis over the past 12 months. median rentSimply Residential used those statistics to justify recommendations of rental rate increases for a number of our properties during 1Q 2016. Low vacancy rates also mean rentals are on the market for less time. We saw this firsthand last month, as 1/3 of our March new lease signings occurred within a week of being marketed.

Real Estate Sales

As job and wage growth slowly drive the country’s recovery from the recession, we’re seeing a renewed consumer confidence. Couple the interested buyers with a low inventory of homes for sale and we have a seller’s market. Homesmsp.com reports that there was a 20.6% decrease in Twin Cities homes on the market in March 2016 compared to March of last year. marchThe multi-colored graph to the right shows how much higher the median sales price was in March 2016 compared to March in previous years. If you’re considering selling your investment property, please speak with us. Along with providing rental property management services, our on-staff licensed real estate agent and broker are happy to provide you a comparable market analysis (CMA) so you can properly consider the options of renting and selling your property. Also, know that we offer special real estate service pricing to our current property management clients.


Whether you’re renting or selling, Simply Residential Property Management’s leasing and sales team has you covered. The first quarter results from 2016 show that both the property rental and home sales markets are very strong. Simply Residential will continue to monitor important factors including the interest rate and the local vacancy rate. But it’s clear that now is a fabulous time to rent out or sell property.

Purchasing Your First Rental Property: What to Look For


Investing your money in property can be a hugely rewarding venture. Regular income, consistent potential to increase your monthly yield and the prospect of a major profit when you sell all make for good arguments. That’s not even mentioning the potential tax deductions. But do you know what you’re looking for when considering your first investment property? Simply Residential Property Management has compiled a handy list of the most important criteria to look for.

Obviously price needs to be one of the key considerations. Expensive properties usually give you a higher monthly yield, but less expensive properties can be just as rewarding. If you’re willing to put in some time and effort rehabilitating a property, you could dramatically increase its rent value and improve your chances of a healthy profit when or if you choose to sell. But beware; properties that seem too good to be true often reveal themselves to be just that in time. If you do your research and follow the market trends closely, you have a better chance of finding the right property for you.

This doesn’t just mean finding a property with good views.  A first time property buyer needs to consider what kind of tenant they’re likely to get based on that area. Buildings located close by to schools and hospitals will likely appeal more to young families, so the potential for long-term tenancies is increased. This is usually preferable because it limits the amount of time your property sits vacant, meaning you go less time without collecting rent.

Resale value
Most first time landlords had to take out a mortgage on their first investment property. This means relying on a consistent yield in order to keep up with repayments. If the payments stop or the profit becomes too untenable, you may have to consider selling the property and moving on. But you want to know that you won’t be selling at a major loss. That’s why you always have to take the resale value into account when considering a property. Try to find out about any future plans for regeneration projects or upcoming attractions that could increase the value of your property further down the line. If a unit is situated in an area with increasing levels of crime, it could lead to house prices in your area dropping to a level below your profit margin.

Property condition
The condition the property is in should always play a decisive role in whether you go for it. Ask about every aspect of its structure, plumbing, wiring and anything else you consider relevant. It’s important to know everything you can about a property before purchasing. This can include investigating similar, nearby properties and comparable, as well as establishing potential issues. Anything from potential damp spots to an outdated heating system could go on to become a massive headache if you were to choose to become the landlord of this property.

There will always be exceptions in the property world, but if you try to follow these rough guidelines, you could find purchasing your first buy-to-rent property is easier than you think.

So, You Want to Purchase Your Second Investment Property


Owning investment rental properties can be trying. It requires patience, research, excellent interpersonal skills and a financial stability that allows for things to, on occasion, go wrong. But if you find yourself successfully balancing all the aspects of being a landlord and want more, then you might want to think about investing in another property. It may be tempting after you’ve already cut your teeth as landlord of the first property, but there are several new things to consider before investing in a second property.

No two properties are ever the same
While you might be thinking you have a strong understanding of what being a landlord requires, you have to go into the venture of second properties with your mind open to every possibility. So your first property was a dream; it didn’t require much maintenance, you had model tenants, it was within easy reach of your own property. You need to bear in mind that, while your first property was easy, there is still a chance of your new property causing you problems. Obviously you have a better knowledge of what to look for, and you will be going into the venture with more understanding than a first time landlord, but this is no excuse for leniency. That’s why so many experienced rental property owners choose to utilize the services of a property management company.

Try to remember what caused you the most time, money and effort to correct your first property, and prioritize these aspects in your search for a second property.

Don’t always buy close to your first property
While it may be tempting to purchase that property just down the road from your first, this should not be your number one reason for purchase. Remember, it’s still important to do your research into the current housing situation. If the properties close to your first are not doing well, then it may be worth looking a little further away. While it does mean more time driving, it could actually save you money in the long run. However, that doesn’t mean you shouldn’t look nearby, especially if your first property is a good area. This also helps you get a rough gauge on extras, like the most likely tenant type in that area and possibly housing bills such as heating and electricity.

Markets fluctuate, so can your property value

Although you will be more experienced than a first time landlord, it’s important to remember that there’s no guarantee the experience of buying a second buy-to-rent property will be the same. The housing market can fluctuate dramatically, lowering the value of your properties. With two purchased properties, it can mean losing double the amount of money should housing values drop. Take some time to research the market, and the area you are considering. If a new transit route has been built near the property, this could increase its value over time. Simultaneously, a new building appearing nearby could obscure views from the property and bring its value down.

The most vital aspect to remember when considering the purchase of a second buy-to-rent property is that you already have a strong grasp of the fundamentals, so use this to your advantage. Remember what worked for your first property and avoid making the same mistakes. If you’re unsure, or you don’t want to take on the additional responsibility of managing a second property, it’s wise to consider investing in a property management company to take care of the minutia.

What You Should Know About Rental Properties and Tax Deductions

Rental properties offer bigger tax deductions and tax breaks than most other investments. For this reason, we find that it’s important to keep our owners up to speed on what they need to know for tax season. Here are a few of the things you may be able to deduct as a landlord or rental property owner:


At Simply Residential, we know that investing in a rental property is a solid financial decision, and we encourage our owners to fully take advantage of the benefits they’re entitled to as property
investors. As we say quite frequently, we have a wide variety of financial professionals, including some awesome CPAs, that we’re happy to recommend.

If you’re curious about which of these deductions apply to you, let us know! If we don’t know the answer, we’ll connect you with someone you can trust to walk you through it!

Ready to learn more? Call us today at 952.893.9900 or email Amanda at amanda@simplyres.com.

A Landlord’s Guide to Security Deposits


Security deposits are a vital part of the rental process. Without a security deposit, there is little to stop your tenants from leaving your property in a state of disrepair; forcing you to foot the bill. That’s why every rental home now requires a security deposit. Aside from the assurance that if there is any lasting or even superficial damage to the rental property, this means you can detract money for failure to ensure your investment is left in a clean state. For this reason, we’ve compiled a handy how-to guide for using the security deposit to both your property’s and your tenants’ advantage.

Clearly explain the cost of damages in the lease agreement
This is important as it lays out exactly what is expected of the tenant in terms of personal maintenance while renting the property. By laying out how much you will charge for damage or loss to each individual aspect of the rental property, the tenant will understand how to properly maintain it, and will be held accountable for that maintenance. This will also act as an incentive to the tenant, showing them in real figures the cost for refusing to ensure proper care is taken when in the property. It’s important to do a full walk through of the property with your tenant before they move in, allowing them an opportunity to point out damages that you had not registered. This prevents misinformed accusations and increasing tensions with the tenant at the end of their tenancy. This is also for the tenant’s protection, ensuring you have to justify each deduction you made from the security deposit and assuring them you are not taking more than the damages actually warrant. Make sure this process is documented and signed by each party.

Photograph everything
When deducting money from a tenant’s security deposit, you will need physical evidence that the damage was caused during their tenancy. That’s why, before and immediately after each tenancy, it’s important you photograph any existing damages, and even areas with no damage whatsoever. This prevents the tenant from claiming the damages were already there, or that they were inflicted after they left the property.

Have a little leeway for wear and tear
While nobody wants their property damaged without being properly compensated, it is likely that some aspects of the property will become worn, through no fault of the tenant. That’s why it can be beneficial to allow for a little wear and tear on the property. The intention of the security deposit is to insure against major structural damage or a costly cleaning job at the end, not minor bumps and scrapes in areas of the property that would inevitably see a little damage.

As a landlord, it’s important to remember you have a reputation to uphold. While some are tempted to take a little extra from the security deposit, your ethical integrity will always win you more business — which translates into more money in the end. It isn’t just a question of ethics, it’s illegal to take more than is owed. Alternatively, rent your property with Simply Residential Property Management and let our independent team of specialists handle the entire security deposit issue; allowing you and your tenants to rest easy in the knowledge only the appropriate compensation will be paid.

Why Hiring a Property Management Company for a Single Rental Property is a Good Idea


For many rental property owners, a common question that they ask is if they need to hire a property management company for a single rental property. The answer from property managers and rental property owners alike is a resounding “Yes.” The fact is that a professional property management service can be a real asset and the services offered are likely much more complex than you might imagine.

Property management companies do much more than simply collecting rent checks and fixing broken appliances – their real value lies in risk mitigation, which should be your top priority when renting out a property. For example, Simply Residential signs the lease with the tenant, taking on some of that risk and allowing our owners to remain anonymous to our tenants. We also offer protection services like our Eviction Protection Plan and our Quarterly Furnace Filter Change and Lease Violation Walk-Through. These services protect our clients from the dangers of evicting a tenant, and help us identify any problems with their property before they become full blown emergencies. This also allows us to provide an efficient and regimented way to ensure that our properties are fully protected.

Choosing a property manager for a single rental property, or even for multiple rental properties, can be a challenge for first timers. The key to this choice lies in knowing what you want and need from a property management company. Some of the specific services you should look for are:

  • Finding high quality tenants.
  • Determining how to advertise your rental property.
  • Screening all tenants, including background checks and credit reports.
  • Drafting legal leases that will hold up in court.
  • Collecting evidence and documentation to reduce chances that property owners will have to pay for tenant caused damages.
  • Maintenance of the rental property.
  • Handling tenants who don’t pay.
  • Evicting tenants without violating their rights.

While property owners can complete their own research and learn how to do the things listed above, this is an extremely time consuming and legally convoluted process that can often land owners in a difficult situation, especially when evictions are a factor.

A knowledgeable property management service can also ensure that rental property owners understand legislation changes and how it will affect them, as well as their tenants. This can be extremely complicated and difficult to understand, and keeping up with the changes requires dedication and time. However, when you hire a property management service, they will know what the legislation means and ensure that you, and your property, meet all new or changed requirements.

One of the most important services offered by a property manager is the ability to respond to emergency situations in a timely manner. This will prevent property owners from having to halt their day – or night – in order to handle a tenant issue or emergency.

Hiring a property manager can eliminate the possibility of your rental property turning into one of the horror stories you have likely heard. In fact, a reputable property manager will handle all aspects of managing and maintaining your property. If you have questions, we’re happy to help. Call us today at 952-831-5300 or email me!

[Photo credit: Rental Realities on Flickr]

A Landlords Guide to Upcycling

Upcycling is the art of taking old, unfashionable materials and turning them into something much more chic and contemporary with little to no cost to the owner. Not only this, but upcycling can help keep your property looking modern without having to purchase new furniture every few years. Here’s a quick and handy guide to everything you need to know about upcycling and how it could help save you money while improving the value of your real estate investment.



With furniture, upcycling can be as easy as sanding down some rough edges or applying a new cover to a battered old sofa. But, if you really want to make an impression with prospective tenants, don’t be afraid to get creative. Kitsch art décor can give your property a bohemian vibe while costing you just a few dollars in new materials. Retro patterns and unvarnished wood are great ways to give your property an earthy sixties vibe. Combine this with modern accouterments and you have a property young professionals would die for. The best thing is, providing they’re still in working condition, you can always upcycle your furniture again the next year to keep it up to date.


upcycled fixtures in rental property

If you’re worried that your property may be too old-fashioned for the kind of tenants you want, then upcycling could provide the answer. An old lamp can quickly be turned into something hip with just a little imagination and some easy to acquire materials. Don’t be afraid to use your imagination, taking ideas from the plethora of upcycling blogs on the internet and making them your own. Old fans can become chandeliers, jam jars can become quirky lightbulbs and old advertisement signs can become a piece of contemporary art with just a few simple twists. It may sound like a cliché, but your imagination really is the only limit.


When it comes to upcycling the exterior of your home, there are even more options available. Without needing to worry about your old garden features appearing weather-worn, you can begin to really test your creative skills. Water fountains are surprisingly easy to make from old materials, yet they add character to your garden and ensure an interesting collection of wildlife all year round. Meanwhile, the addition of a garden swing or hammock made from indoor materials will give your property the kind of personal flair that insists prospective tenants take a seat and never leave.

When it comes to upcycling the exterior of your home, there are even more options available. Without needing to worry about your old garden features appearing weather-worn, you can begin to really test your creative skills. Water fountains are surprisingly easy to make from old materials, yet they add character to your garden and ensure an interesting collection of wildlife all year round. Meanwhile, the addition of a garden swing or hammock made from indoor materials will give your property the kind of personal flair that insists prospective tenants take a seat and never leave.


Upcycling is just one aspect of your property that you have ultimate control over. Don’t be afraid to play around with aspects of your property, but be sure to limit the level of personal touches. Try not to make the unit too orientated to what you like. It’s important that you bear the tenant in mind when setting up your property. As long as your upcycling serves a practical or subtle stylistic purpose, it could go on saving you money tenant after tenant.

How Does Simply Residential Protect Your Rental Properties?

How simply residential property management protects your rental property

Ensuring the safety of what is arguably the largest and most important investment you’ll make in your life is something that we take very seriously at Simply Residential. Here are a few of the services we provide to make sure that your property is protected and being used in a responsible and non-destructive way:

Every month we send an email to our tenants to ask them about any maintenance needs. This email includes a list of seasonally appropriate things to check. Since many renters haven’t owned their own home, we take the time to educate them about what they need to look out for and when.

With this optional service, we go to your property once per quarter to change your furnace filter. While we’re there, we do a property walk-through to determine if there are any lease violations on the part of the tenant that need to be addressed.

This optional service allows us to perform a full assessment of your property and identify any maintenance issues that may come up in the next year. That information allows us to plan out and budget for necessary maintenance needs so you don’t end up having to pay all of the costs at the same time.

Move-in, Move-out
When a tenant moves in, the first thing we do is a walk-though of your property to make thorough notes of its condition, including extensive photographic documentation, with the new tenant. We then collect the tenant’s signature for verification that they were present and agree with our findings. Upon move out, we do the same walk-through to assess for any changes in the condition of your property. This walk-through is fully and extensively documented with photos and covers over 70 points within your property.

No matter what time it is, or the nature of the issue, we have a team of full time, professional maintenance technicians who are available 24/7/365 to our tenants. This allows us to quickly and efficiently rectify any damaging problems and handle emergency needs immediately so they don’t escalate or create more problems in the future. This makes it convenient for tenants to report any problems with the property at any time, which is their responsibility per the signed lease agreement.

Taking care of your property is our first priority. If you’re interested in learning more about our optional annual walk-through and/or quarterly furnace filter change and lease violation check service call us today!

Contact our Maintenance Department: maintenance@simplyres.com or 952-715-6183.

The Real Estate Counter Balance: Rent or Sell?

The Real Estate Counter Balance Simply Residential Property Management

The real estate industry is something that affects every single person, and for that reason there’s often a plethora of information available from several points of view. While most of this information is provided with the best intentions, it’s often more gossip than fact. Recently there have been quite a few articles claiming that the rental market is exploding right now. Of course, we’re inclined to agree with this statement from a business standpoint, but feel compelled to add a caveat in the interest of full disclosure. While it’s accurate to say that landlords can charge more for rent now than they previously have, these high rents are actually pushing many would-be renters into the buy/sell process.

This phenomenon is what we at Simply Residential call the real estate counter balance. When more people are buying homes, there are fewer renters in the market, and vice versa. This means that it’s advantageous for owners to be strategic and competitive when pricing their rental property in times where the market favors buy/sell. This will get your property more attention from potential renters, and ultimately get it rented faster. The faster a tenant is placed in your property, the sooner you start to see the financial benefits of your rental property.

As a property owner or investor, it’s difficult to know whom to trust in situations like this one. There’s quite a bit of conflicting information out there, and it’s hard to know what to believe. Luckily, owners and investors that work with a quality property management company like Simply Residential Property Management, have a partner to help them sort these things out. After all, that’s our job. Did you know that we perform a rental analysis for every lease agreement renewal? That way we can make sure that our clients are getting the most return on their investment.

The benefit of working with a local property management company is that they also have an intimate knowledge of specific markets. We live and work in the Twin Cities and surrounding communities and are able to understand certain nuances that often help us get properties rented faster.

Do you have questions about the value of your rental property, or are you contemplating what your next steps will be? We’re here for you! Call us today and let’s talk: 952-831-5300.

6 Tips for Advertising Your Rental Property [Infographic]

6 tips for advertising your rental property (1)

Finding the right tenant for your rental property can be a challenge. These 6 tips can help you understand how to advertise your property to attract a great selection of renters.

1. Take awesome photos. Good photos can help bring your property to life, finding the best angles and showing off its best features. Try to make sure there are at least eight photos of your property, including a few exterior shots. It may be worth looking into hiring a professional.

2. Include a floor plan. Understanding the layout of your rental property will allow potential renters to visualize the space as their own.

3. Include details about local amenities. If your property is conveniently located near to schools, hospitals or shops, then say so. Features like quick access to public transit and shops can massively increase a property’s appeal.

4. Know your audience. Look at what types of property appeal to which kinds of people. For example, If your property is located in a student area, then tailor your message to emphasize the requirements you believe they will prioritize.

5. Be realistic about rent. Charging too much for rent can result in extended vacancies, leading to a loss of profit. Conversely, charging too little for rent can make you miss out on your max ROI.

6. Hire a management company. When you work with a property management company like Simply Residential, they handle the advertising from strategy through execution, leaving you with more free time to enjoy your earnings.

Advertising is key to the success of your property investment — make sure you’re doing it right! If you have questions about how to market your property, or want some help getting all the steps right, let’s talk: 952-831-5300!