Here are answers to some of the more frequently asked questions FAQs we hear about our services. If we missed something, please call or email us:
How much do you charge to lease my property?
Many property managers and real estate brokerages charge a leasing fee of between 5 and 6% of the annualized monthly lease. For example, $2000/mo lease x 12 months = $24,000 per year x 6% = $1,200, which will be split 50/50 between brokers; half for the listing broker/agent and half for the leasing (showing) broker/agent.
Other brokers charge additional fees for everything from listing, to preparing the lease agreement, to taking the lease listing photos. Our fees are far less. We charge a flat 2.5% of the first year’s rent as a leasing commission which is paid to the selling broker. This is one half of the leasing fee and goes to the broker/agent who obtains the qualified tenant. (No renewals) We also charge 10% of one month’s rent to list your property for lease on the multiple listing service, MLS along with posting your listing nearly 100 different websites. We will also screen your applicants and draft a complete California Association of Realtors Lease Agreement including all disclosures.
By the way, Our lease listing fee of 10% of one month’s rent pays to screen your tenants. this includes complete credit, background, criminal and eviction check; verification employment, employment income and other stated sources of income; review rental history with your applicant’s current landlord, and previous landlord to confirm the applicant’s tenancy. We will review all the applicant’s information with you and mutually decide to accept or decline any prospective tenants.
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How much will you charge to re-lease my property to an existing tenant?
We charge $100 to negotiate a new monthly rent and draft a lease extension. Why? Tenant’s don’t like rent increases and tend to avoid the subject, therefore we spend a great deal of time bringing the negotiations to a successful conclusion. (Back to top)
What type of rental properties do you manage?
Our mission is to provide the family and/or individual investor who owns one or more single family homes, condos or town houses a low-cost, professional solution to their property management challenges. We will take over the daily worries that arise in property management including; leasing, screening tenants, managing, maintaining and refurbishing single homes, condos and small, multi-family units. (Back to top)
What areas of Southern California do you cover?
We are currently managing properties in Irvine and the surrounding communities. It doesn’t make sense to go outside of this geographic area.
We’ve lived here in Orange County for more than fifty years so we know the communities and understand the demographics. We know which areas get prime rental rates and which are challenges and understand how to navigate each. Local knowledge is a time and money saver when leasing and managing rental property, so this provides us with an advantage when marketing your property. (Back to top)
How quickly will you lease my rental property?
Wow, good question! We can never say for certain, because there are so many factors that affect your timelime. Bottom line is it depends on you, your property and the marketplace. I’m sorry to report that what you need to earn in rental income to cover cash flow should not determine the rental price. Price and amenities are top of mind for most tenants.
Price, is the most important factor in deteriming how quickly a rental property will get rented
Our mission is to get your property rented as quickly as possible to the best possible applicant by pricing the property to compete at the current market rates for that specific area.
Additionally there many other variables that affect the amount of time on the market including location, quality of the home, season its listed, the amount of “active” listings in your marketplace, applicant quality and being in the right place at the right time.
This is a numbers game and to win, you have to have as many potential tenants looking at your home as possible. Prospective tenants can’t look at it if they don’t know it’s there, and advertising on the internet is the only way to let them know about your property. Rest assured that no other property management company is more effective advertising and promoting your rental home than Hermitage Property Management. Although vacancies are unsettling, we follow our proven processes until we find the right tenant for your real estate investment. (Back to top)
How much will my rental property rent for?
Often real estate investors will set rents based on how much they need to earn to cover their mortgage and HOA expense, or how much they want to net, or based on what they heard another rental home is renting for. These methods almost always create problems. Arriving at the appropriate market price isn’t rocket science but can be tricky. First and foremost basic economic forces are the most important factor. For example, what are similar priced homes renting for? Additionally, location (good or bad), upgrades, paint and flooring and cleanliness all play a role in what home will rent for. This is one of many areas where our experience can help make a difference.(Back to top)
What’s the rental market like currently?
The current real estate market is hot these days with investors scooping up properties as quickly as they come on the market. Investors and people looking to upgrade or buy a home or trying to take advantage of the historically low interest rates and property values. Additionally, rent rates have been going up 2-3% per year for a few years now, making the rental market very attractive.
Bottom line, Orange County’s economy is booming and record numbers of people are looking to rent because home ownership is too expensive or may not make sense with housing prices so high. There is a lot of competition out there for rental properties. That’s why Hermitage Property Management is the logical choice.
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What steps do you take to lease my rental home property?
After many years in property management, we know what works and what doesn’t and have developed a comprehensive marketing system that utilizes various methods of marketing your property through various websites and our extensive network of real estate agents.
Our advertising does not stop there. We are also very active and aggressive in our Internet marketing. In today’s competitive market, we find many of our renters are more comfortable with computers than newspapers and we actively cater to that segment. Hermitage Property Management networks with several different web sources and that helps keep us at the top of the search engines. Internet marketing cost is a part of the service from Hermitage Property Management.
Naturally, we also market to local government housing programs, corporations, and relocation departments. If tenants don’t see your property, they won’t know that it is available- so we make sure that they do!
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When you find residents for my rental home, how do you qualify them?
We strive to provide you with the very best quality residents possible. Here is what we do to screen your prospective tenants:
- A complete credit application on each adult resident 18 yrs and older.
- A complete credit report on each adult principal resident or cosigner.
- A verification of each principal residents social security number.
- A court search to see if the applicants have ever been evicted in the past 7 years.
- A criminal check to see if there are any convictions.
- A search of the 3 major credit bureaus to see if applicants have any outstanding collection accounts.
- Verification from their former landlords.
- Verification of their employment.
- Verification of their income
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How often and how are property inspections conducted?
When your property is vacant, we generally inspect it each week. The next inspection is done prior to the residents moving in. This is known as the “move in” inspection, where we detail the condition of your property on our move-in inspection form. We also photograph the move in inspection.
We inspect the exterior of our properties on a periodic basis and we also conduct other inspections when requested, or if we determine that an inspection of the property is warranted.
Within 90 days after the residents move in, we contact the residents to re-inspect and to ensure that all is well with your property and your residents. Between the 10th & 11th month of the residents lease, we discuss with the residents their intent to renew their lease for another year. If they are not renewing, then we advise our leasing staff to ensure that we are able to get the home re-rented quickly with little or no vacancy.
When the residents move out of your property we do another detailed inspection known as the “move out” inspection. The move out inspection is done to ensure that the residents returned the rental home back to us in the same condition as when they first rented it. If damage is found, then we impose a claim on the Tenant’s security deposit as required by California Tenant/Landlord Laws, if no damage is found, then we promptly return the security deposit to the former residents. (Back to top)
What are the terms of your property management agreement?
We are a performance-based company and if your not happy, we’re not happy. Thus we have an easy cancellation policy. During the first 60 days either party may cancel with a telephone call, thereafter if we do not perform to your satisfaction, you may cancel with a 30 day written notice. (Back to top)
What are your property management fees?
Our standard monthly management fee for a single-family rental home is $100 a month. We do not charge any set up fees either. We do suggest listing your property on the MLS so other, cooperating broker/agents can also show your property. we suggest you offer a 2.5% commission to selling agents to get more “eyeballs” to see your property. (Back to top)
When will I receive my rental funds?
We pride ourselves on quick turnaround of your rent income. We offer “Electronic Direct Deposit” or ACH deposits in to your bank account. Rent proceeds are deposited into your bank account after they have cleared our bank and all outstanding bills are paid. You are paid a Net Rent check no later than the 12th of each month unless your tenant is late with their rent.
Our goal is to get our tenants to pay their rent electronically by the first of the month although tenants are given a 5-day as a grace period. On the 10th of the month, we will also send you a monthly statement detailing your account activity, with any original receipts, work orders etc. We can also email monthly statements if you prefer. (Back to top)
What if a tenant damages my property?
With our screening program, the chances of this happening are slim. As we market quality rental properties, we attract quality stable tenants. With that kind of tenant, malicious damage is rarely a problem. In the event a tenant does damage to the property, we get the house back in rent ready condition as quickly as possible and re-leased. Once we are clear about the cost of the damage we assist you with obtaining judgments, filing complaints if appropriate, and even collecting on the judgment.
Our office has an excellent system of tracking damage and cleaning costs with our move-in and move-out inspections. We will charge residents for any damage or cleaning related directly to them; however we are very fair and will not charge a resident without merit. (Back to top)
What if a tenant needs to be evicted?
Although a rare occurrence, we will handle the process for you through our legal resources. California statutes provide the framework that must be used to go through an eviction in the shortest time possible. This is one of the most common areas where real estate investors get in trouble by trying to “save money”. Great property management doesn’t cost money, it pays, and in this case, not understanding the tenant’s rights can cost a small fortune. We keep the tenant if possible, evict if we can’t keep them current and get the house vacant and rent ready as fast as the law allows. (Back to top)
Do you get my approval before doing any maintenance work?
Your Property Management Agreement will outline the parameters for maintenance approvals, based on a mutual agreement. Whenever possible, we will contact you for your approval for repairs over the stated limit on your property management agreement. However, if the repair is an emergency, we may feel it necessary to authorize the repair and then contact you to inform you of what has happened. We have a stable of quality service contractors who respond to our requests as quickly as possible to take care of any emergency. This ensures that your property is given the best care possible. (Back to top)
Do you guarantee the residents that you place in my rental home?
YES, we provide our property management customers with the following guarantee: Should any tenants that we place into your rental home move out and break their lease (for any reason), we will waive our normal leasing fee and re-rent your home to new tenants FOR FREE! (Advertising cost excluded) (Back to top)
Are you the cheapest company in town?
Nope. It seems there is a new property management company or Real Estate Agent starting out every day, trying to beat everyone else’s prices. Our fees are very competitive and we certainly are not the most expensive. On the other hand, we charge a fair fee for a tremendous service. (Back to top)
Who handles problems late at night?
We are always “ON CALL” to handle late night calls from our residents. Our phone is always on 24/7-to take the residents emergency calls and/or contact the appropriate service.
Many times we solve problems right over the phone avoiding what might have been an additional maintenance expense. (Back to top)
Why should I choose Hermitage Property Management?
In a word, “Experience”. Our customers know that, “Our people make the difference”. We believe that the key to our success is in the personal relationships that we have developed with our Owners, Tenants & Vendors over the past 27 years. We are here to serve you and your residents. (Back to top)
Miscellaneous Questions and concerns
LOCKS: We strongly recommend that all property door locks be changed after each new tenant to insure that all keys are accounted for. This will give the tenants peace of mind and minimize your liability.
LANDSCAPING MAINTENANCE: For units of two or more, exterior maintenance in all common areas is your responsibility. For single-family homes, yard maintenance is your option. As a suggestion, you may wish to pay for yard service and water if the landscaping is an important issue. Even though our lease reads that the resident is to care for the yard, we cannot guarantee compliance (or the residents’ gardening expertise). If during our monthly drive-by inspections it appears that attention is needed, we will remind the resident of their responsibilities. If the problem persists, Hermitage Property Management will correct it to the best of our capabilities and charge the resident for those services.
APPLIANCES: We suggest you do furnish the stove and refrigerator. Moving large appliances in and out can be hard on doorjambs, carpet, tile and vinyl floors. If the laundry room is not in the garage or near an outside door we suggest you also install a washer and dryer. This is especially so, if the property may be desirable to first time renters, college students, newlyweds, corporate transfers, etc. Any damage to the appliances that was done by the resident will be charged to the resident.
UTILITIES: We recommend that residents pay for natural gas and electricity. Water, trash and sewer are optional, however if you have nice landscaping you may consider offering the home with the water paid as residents may not be willing to pay a high water bill for watering your rose bushes or lawn.
WINDOW TREATMENTS: A unit supplied without window treatments is an invitation to your resident to drill holes in the walls and leave holes behind at move-out. It also encourages makeshift window coverings, such as sheets, blankets or worse. For these reasons, we do require that your property have adequate window coverings before a resident takes occupancy.
FINAL THOUGHTS: As difficult as this may seem, we recommend keeping your emotions about the property to a minimum. Think of the mortgage that is being paid by renting it out! Normal wear and tear is to be expected. Any damage that may occur can be repaired and anything can be replaced.
All of the above also applies to investment properties. “Return” on your investment is the key; not torn drapes or stained carpet. These can be replaced with resident’s Security Deposit. The important issue is keeping them rented. While it is wonderful to find the perfect, non-smoking, no pet and wishing a one-year lease type of resident; they are few and far between. Allowing pets, smoking and open lease lengths are a sure way of providing an open market and continued income. There are many considerations to make regarding an income producing property. If you have additional questions, please feel free to contact our office here. (Back to top)