Lakeville MN Rental Homes in High Demand

It is no secret that the rental market is the best it has been in 10+ years.  Vacancies are at an all time low and rental rates are higher than normal and still increasing.  We here at MN Rent Solutions just serve the southern suburbs of Minneapolis and St. Paul.  Serving these southern suburbs has led to us observing some cities that are in extremely high demand for rental homes.  In reviewing our statistics, Lakeville would have the highest demand of all the southern suburbs.  But this demand is not for all property types, single family homes are the most desired.  You will find many town homes for rent on the market, but very few single family homes.  When we list a single family home in Lakeville for rent, it is averaging just 10-14 days until we have found a tenant and signed a lease for our clients.  We have asked each tenant about the draw to this community and many cite the school district and that they hear Lakeville is a great community.  As a resident of Lakeville myself, they are making a great choice to join such a great community.

We are now finding that the demand outweighs the supply.  If you own a home in Lakeville and you are considering renting, please give us a call.  We here at MN Rent Solutions will handle everything for you and make the rental process turn-key.  We look forward to speaking to you and exploring options.  Here is a link to our property managers FAQ's

New Year, Same Excuses

As we look forward to 2012 and say goodbye to last year, many new real estate investors will forgo using a property manager in lieu of becoming landlords themselves for the first time. It may even be one of their yearly goals to acquire an income producing rental property. The fast and lucrative lifestyle known as real estate investing, a dream which yields hoards of money overnight and comes with a fully loaded German-engineered luxury vehicle, is just a two bedroom rental condo away from reality.

To some that may be true and I’m not knocking the idea of a PM business starting small. I have personally witnessed the power of real estate investing, but with all kidding aside most new real estate investors who plunge into managing their own rentals find themselves at a disadvantage early and often when it comes to entering the game know as landlord versus tenant.

The rules of the game are fairly simple and most of the time both parties play by them. Overly simplified, the landlord’s duty is to supply a safe and temporary inhabitance for the tenant, who in turn pays an agreed upon rental rate for the right to occupy the dwelling for a contracted amount of time. The objective of the landlord is to bank or reinvest the cash flow (amount in excess of the mortgage payment and operating expenses) from the rental unit(s) each month and build wealth. The disadvantage begins when the new landlord places a tenant who doesn’t play by the rules of the game, throwing a monkey wrench in the whole building wealth formula.

The battle scarred and seasoned tenant alters the game to their advantage with rule changes that may go something like this; initially the rent is a couple of days late, then a week late, and then a request to change the rent due date because “They get paid later in the month”, then a phone call stating that their hours have been cut or that they will be a little short this month and can only pay a portion of the rent, then finally no return calls and nothing but silence.

News flash: if it gets to this point in the game you may have already lost. Though truthfully, you have been losing the whole time. At this point you are owed a couple months’ rent and need to start the eviction process while hoping that your property isn’t totally destroyed. There is no guarantee that having a professional property management in place would have stopped this from occurring but odds are an experienced property manager who is familiar with these trends would take fast action to limit the downside risk in these situations.

In property management it’s not if these issues will occur but how you deal with them when they do that makes you successful. Start the New Year off right and let one of your real estate resolutions be to add a professional property manager to your team.

By Salvatore Friscia, San Diego Premier Property Management, San Diego, CA

Form 1099s & Year End Statements

For property management companies, the month of January signals a time to prepare and issue year end statements to their clients for tax preparation purposes. Consequently, each January the IRS requires that any taxpayers who have made payments in excess of $600 to workers that are not considered employees must prepare Form 1099 – Miscellaneous Income. Property management companies are also federally required to file Form 1099 for their clients regarding rental income received throughout the year. In addition, copies of this completed form must be provided to the IRS. The IRS compares the payments shown on the information returns with each recipient’s income tax return to determine whether the payments were reported as income and done so properly.

-The filing deadline for Form 1099 is January 31, 2012.

-The IRS also requires that you file a Form 1096 to identify all of the Form 1099s.

-The filing deadline for Form 1096 is February 28, 2012.

Failure to issue a Form 1099 and file Form 1096 results in penalties and potential disallowances of deductions for those amounts paid. Thus it is imperative to comply with these filing requirements. In years past, SDP Management would spend a lot of time and resources preparing large bulky paper laden year end packages to meet these requirements. The packages, which contained printed year end statements and other tax required documents, would detail the properties prior year performance and provide necessary documentation for the client’s CPA or tax preparer. All packages would be carefully prepared prior to the end of January and mailed via snail mail (USPS) at a considerable cost. Well, the industry has advanced and those days are long gone. The advent of cloud computing and advanced property management software, such as Buildium, have allowed property managers to formulate numerous detailed reports and provide them via email in PDF format to clientele at a fraction of the cost and time.

These reports also meet state and federal requirements. It has also allowed the tedious and many times misunderstood Form 1099 to be computer generated and scheduled for automated mailing. Not only is this convenient for property management companies, but it also allows clientele to continue forwarding the year end PDF report to their CPA or tax preparer regardless of where they are in the world.

Don’t let 1099s and year end reports get you down, use January to focus on the upcoming year and not the past.

By Salvatore Friscia, San Diego Premier Property Management, San Diego, CA