Here’s What To Expect
If there is one thing that everyone can agree on, it is that COIVD-19 has turned our world upside down and changed the way we look at even the everyday item like hand sanitizer. Although just about every industry has been impacted in one way or another, the real estate industry is one seeing some of the largest long term changes and property management is no exception. If you are anything like most landlords, you are probably wondering what changes COVID-19 will bring about on both a short and long term basis. Today, we will dive into some of those changes and help you prepare for what is to come whether you are a Sacramento landlord or tenant.
Higher Standards For Cleaning & Sanitizing
Perhaps the most obvious change will be the implementation of higher cleaning and sanitizing standards when properties are being flipped in between tenants. Renters that may have once never given sanitation a second thought will now look at it as a top priority until the scare of COVID has worn off.
Agencies like the CDC have released cleaning and sanitizing guidelines that you could use to establish your new standards for cleanliness. However, every Sacramento landlord and property manager will have to clearly communicate with their tenants to establish who will be responsible for the cleaning and sanitation of each apartment at move-out.
Evictions, Notices, and Late Fees
With so many renters being placed out of work for months at a time there has been an unprecedented spike in delinquent rent payments. Although the federal government has stepped in to protect renters from eviction for four months, this means there will still be many long term consequences. If you are a Sacramento landlord struggling to collect rent right now, you may be worried about how you will be able to pay your mortgage as a result.
As it stands right now, Sacramento property managers and landlords cannot evict for non-payment of rent for 120 days after May 31st. However, to be protected by this law tenants are required to:
- Submit verifiable documentation to support claims of hardship
- As much advance notice as possible that there will be payment delays
- Submit these required forms before the rent is due
- Proof of financial impact like pay stubs that show how much income has been lost and how much relief is needed as a result
No matter how you plan to handle your evictions and late payments, one thing that is for sure is that more and more Sacramento landlords will be adding new provisions and verbiage to their leases to address these policies moving forward.
More Fiscal Responsibility
With more than 20 years of experience in Sacramento property management, I can attest to how common it is for landlords to lack financial responsibility with their rentals. If you are anything like most smaller Sacramento real estate investors, you use your rent payments to pay your mortgage and count the rest as profit. However, your portfolio of Sacramento real estate investments should be managed just like a business.
In other words, you should look at the rent collected each month as business revenue and implement a strategy as to how you will allocate that revenue. One of the biggest changes I help my landlords implement is a system for saving to plan for the future. When COVID began ravaging the industry, many of my landlords were able to protect and save their entire portfolio of properties because of these savings which allowed them to keep paying their mortgage. Others will now be able to use their savings to invest in adding more properties to their portfolio at rock-bottom prices.
Virtual Tours & Leasing
Although it might seem like everything has frozen as a result of COVID, the truth is many people are on the move. People are flocking to the suburbs which have a new sense of appeal and rental turnover is going to spike. If you want to fill your empty units with eager and financially qualified tenants, you need to be marketing your units virtually with 3D virtual tours. With so many people working from home and working odd hours, you need to make it comfortable for prospective tenants to tour and lease a property completely virtually.
Struggling To Adjust?
I understand that COVID has torn many lives and businesses apart and landlords have been some of the most heavily impacted by this crisis. If you are struggling to collect rent, worried about evictions, wondering how to recover your portfolio, or want advice on how to leverage the current market to your advantage give us a call. Here at Alpha Property Management, we will customize a plan to help you optimize the performance of every property in your portfolio and implement a management strategy that will trade all of your property management headaches into wins.