"We are your local resource and caring
professional serving NoVA & DC"

Circle PM Blog - Insight, Stats and More

5 Tips on How to Prevent Property Damage this Winter


Eric Guggenheimer - Wednesday, November 01, 2017

Winter is coming and with it comes colder temperatures that can damage property if you haven’t prepared properly. Follow these 5 tips on how to prepare your property and prevent damage from cold weather.

1. Keep Your Pipes Warm

Frozen pipes can be one of the most costly damages brought on by cold weather, with the average insurance claim for damage totaling $18,000. If a pipe freezes and bursts, it can cause a whole slew of other problems from damaged drywall, interior flooding, mold, and more. To avoid frozen pipes, make sure your pipes are insulated properly, shut off all the inside valves for the outside spigots (hose bib) and open the hose bib to allow water to drain. Its also important for you to keep your heat on at a minimum of 65 degrees even if you go on vacation. If you are afraid a pipe will freeze while you are away, leave the faucet dripping slightly. This will keep a constantly flow of water through the pipe which makes it harder to freeze. Also, most pipes are located in cabinets, which can block heat. So it is a good idea to keep interior cabinet doors open to keep heat flowing to your pipes.

Inspect the area and walls around your pipes and fill any holes or cracks with caulk to prevent heat from escaping and cold from entering. Finally, you can add heating tape or extra insulation to ensure your pipes stay warm.

2. Trim Your Trees and clean your gutters

 
Trees are also a cause of damage in the winter, with damages ranging from $3,000-$10,000. Wind from winter storms and the weight of snow and ice combined with cold temperature causing branches to become brittle can easily cause dead or weak branches to snap off and crash into your house or car. To avoid this, take a day to trim and remove any potentially weak and dead branches near and on your property or where you park your car. It's important to keep rain and snow water away from your home. Ice dams and improperly directed water from your roof, gutter system and down spouts can lead to long-term problems like wet basements, sagging soil conditions which cause water to pond against the foundation and lead to serious moisture problems.

3. Maintain Your HVAC

Having heat circulate throughout your property is not only important for comfort, but also for ensuring your pipes don’t freeze. Even one day without heat can cause expensive damage and if your furnace goes out, it is very costly to replace. To ensure your furnace is working properly and to prolong it’s lifespan, schedule a routine maintenance check and replace your air filter more frequently due to the drier air. A clogged filter reducing efficiency and reduces the airflow and can even cause your system to become clogged.


4. Check Insurance Policy

No one wants to have their property damaged by cold weather or have to submit an insurance claim. But just in case you find yourself in this situation, you’ll want to know exactly what your policy covers. Give your insurance company a call to go over the specifics of your policy and make sure to ask about common winter damage. It’s also a good idea to ask them about common claims they see in your area this time of year and check if you are covered for those.


5. Have A Backup Plan

If winter strikes and your property is damaged, the last thing you want to do is to have no where to go. Create a backup plan in the event that your property is unusable. Check with your insurance on what support they can provide and make sure to have a plan for anything else. Reach out to family and friends or find a nearby hotel and have a bag packed with the essentials, ready to go. Communicate the plan with everyone at the property and decide on a meet up point. Following these tips on how to prevent property damage from cold weather will not only help keep your property from being damaged, but can also save you time and money in the long run. If you have any questions or would like more information on how to prepare your property for the winter, send us a message at info@circlepm.com.




What to Expect with Your Circle Property Management Home Inspection


Eric Guggenheimer - Monday, September 25, 2017

Getting your home inspected isn’t just for new homebuyers. At Circle Property Management, we provide a home inspection for all our new clients.


Having your investment property inspected is essential to creating a better tenant experience, lowering risk of property issues, and controlling maintenance costs. Here, we discuss exactly how all these things work to provide you with a better version of your investment property.


Here’s what to expect for your home inspection at Circle Property Management.


High Level Service and Value


At Circle Property Management, you can expect us to go over every detail of your investment property from top to bottom. A proper home inspection leaves no stone unturned. We provide our clients with the highest level service and value available. When you choose us, you know that your property is scrutinized under the eyes of professionals who have been in the business for years and know how to properly evaluate a rental home.

 

Better Tenant Experience

 

When you get your investment property inspected, there are zero surprises for the tenant. This means you know about issues beforehand and have the opportunity to correct small maintenance issues before they become larger problems. A tenant who knows his or her home is well cared for is a happy tenant.

 

Better tenant experiences enable you to not only get positive references for future tenants, but also encourage your tenants to properly maintain the home. When the tenant feels as though you’re taking care of business, they may be more amicable when and if things do go wrong.

 

Lower Risk of Property Issues

 

We just discussed how knowing about issues beforehand can keep your property in much better condition. A thorough property inspection can uncover many issues, therefore lowering your risk of costly maintenance in the future.

 

Fixing a problem before the tenant has a chance to move in and complain about it is always preferable to the tenant moving in and then having to handle an issue. A home inspection that’s well conducted can make future maintenance on your investment property a breeze!

 

What’s Included in Your Home Inspection

 

When we do home inspections at Circle Property Management, we cover all the bases. These are some of the items we include when we do your inspection:

 

  • Inspect heating, ventilation, and air conditioning

  • Check for potential problems with condensation on air conditioning lines

  • Confirm easy access to shut off valves

  • Inspect washer and dryer; look for any mold or dampness in this area

  • Check for drainage issues, gutter problems, and soil sloping toward the house rather than away

  • Inspect the attic

  • Document all appliances and potential repairs needed

  • If there are any water stains visible on the ceiling, we identify the cause or the source

  • Use a moisture meter throughout the home to identify any potential issues

  • Check for gas leaks or other leaks that may cause a strange smell

 

Based on all this information and more, we create a report that’s approximately 30 pages long including pictures. You can review this information and we’ll be happy to review it with you to discuss what needs to be done to get the property in working order.

 

How the Home Inspection Helps You

 

The goal of our home inspection at Circle Property Management is to uncover potential problems on your property that should be corrected before tenants move in. We can also confirm pre-existing conditions on the home, which allows you to be clear when it comes to tenant vs. landlord responsibilities.

 

Essentially, our detailed home inspection will help protect both the landlord and the property manager in the event that something should happen. It’s expected that maintenance concerns will arise with your investment property. Let us help you better understand them and manage your maintenance costs appropriately through our home inspection.

 

When was the last time your investment property got a home inspection? Or maybe you’re on the hunt for the perfect rental property to make some extra income. We can help. Our home inspection goes a long way towards ensuring that your investment property stays at just that—an investment. Let us help you create a better tenant experience and lower maintenance costs with a proper home inspection!

Things You Should Consider When Hiring a Property Management Company


Eric Guggenheimer - Monday, August 21, 2017

Congratulations on making the investment into a rental property. Chances are you’re excited to get started and make some cash!

Of course, purchasing your rental property is just the beginning. When you’re considering hiring a property management company, it helps to think about what needs to be done. Are you prepared to take on all the tasks of not only a homeowner but a property manager as well?

Here are some things you should know when you’re thinking about a property management company for your rental space!

What You Need to Get the Home Ready

If your home doesn’t need any renovations, you might think it’s ready to rent. Is it?

Consider that you’ll need to change the locks (if you haven’t already done so), check all appliances, clean carpets, perform any yard maintenance, and perhaps paint or at least clean inside.

Do you know how much you’ll charge for rent? What about accepting pets? After these items are determined, you’ll need to find a way to attract potential renters. Although there are certain free online options to do this, they might not attract the best renters.

After advertising, you’ll need to show the home to potential tenants. Any ones that want to follow through will need an application. Do you know which application is valid for your state and where to find it?

Screening tenants is a separate process that needs to be done to ensure you don’t end up with renters who refuse to pay the rent and won’t leave.

All this before you’ve even actually rented the house or received your first month's’ income! Getting your property ready for rent and actually signing that first lease takes a lot more work than people think.

Tasks to Maintain Your Property

The work doesn’t stop there. You’re going to have to maintain the property if you want to keep your tenants happy and fulfill your obligations as a landlord.

What does this mean?

Well, performing regular home inspections for one. You’ll have no idea what the tenants will bring into the house—unexpected “overnight” guests, pets, illegal firearms. Not only that, but you’ll need to ensure that smoke detectors are working, no fire or safety hazards are present, and that everything is working smoothly.

For that matter, any repairs that need to be done are your responsibility as well. If the tenant calls with a complaint that something isn’t working, you’ll be required to fix it in a timely manner. Should any emergencies happen—such as a plumbing problem, storm damage, or a roof leak—you’ll need to be on top of it.

Collecting the rent and handling the payments is part of your job as well. Although the tenant screening process can help ensure that your tenants will pay on time, there’s no guarantee of this and you could end up in a legal bind where you’ll need to seek representation.

And finally, when the lease is up and your tenants move out, the whole rental process starts all over again—changing the locks, cleaning, advertising, showings, screening tenants, and property maintenance.

The Risks You Need to Manage

Of course, with an investment such as this, risks are inevitable. Managing risks is something you’ll need to do to protect your investment.

These include risks of not complying with fair housing rules, accounting for guests or pets that aren’t allowed, and legal risks like lease violations. Financial risks such as property damage not covered by insurance are a concern as well.

Handling all this and more can feel overwhelming. This is why people consider hiring property management companies. Here’s how a property manager can help you accomplish these tasks and relieve the burden of taking care of every detail for your rental property.

How a Property Management Company Can Help

When you’re considering hiring a property management company, you’ll need to consider all of the things you need to do to protect your investment.

A skilled and experienced property management company can help you with all of this. They’ll help you manage your property to secure your best return on investment (ROI). Their job is to handle all aspects of your property, therefore keeping your tenants happy. Happy tenants make excellent tenants.

A property management company will also work to conduct turnovers quickly when the lease is up. This means your property spends more time occupied which provides you with better ROI.

When you have another job and you can’t keep up with everything your rental property requires, consider a property management company. The right company will be locally based to best suit your needs. You’ll still be a part of the process, but less burdened by all the responsibility.

A great property management company is an investment just like your rental property is. By protecting your investment, your team of professionals helps you be even more successful with your rental property.

Consider property management to maximize your ROI and keep your tenants happy, all while enjoying extra income!


3 Potential Pitfalls of Managing ‘Investment’ Rental Properties Yourself


Eric Guggenheimer - Monday, July 03, 2017

Professional property management is like your insurance policy. You pay your landlord insurance policy faithfully every year, knowing you’re covered. When you consider the added value you receive from professional management of your property in addition to this policy, the real value you receive is a bargain for the price!

 

When you manage your own investment property, it’s essential to consider the risks. Whether you’re an experienced investor or a new one, no property comes without risks.

 

The three greatest risks you incur from having an investment property are county and city compliance, improper lease documents, and finally—as well as the costliest—a bad tenant.

 

There are many reasons to consider professional property management to reduce your risk when investing in something as large as a property. One of them is the incorporation of software systems to manage your property with ease.

 

This includes management of all the data related to tracking things like mechanical equipment, HOA rules and regulations, insurance compliance, pet compliance, and your utilities during turnovers.

 

Highlighted below are some additional services that’ll benefit you when taking advantage of a property management service for your investment:

 

  • Accounting reports for your income and expenses to use for tax purposes.

  • A pool of verified and vetted contractors with negotiated pricing.

  • Local resources to handle a multitude of problems.

  • Experience to communicate with you and the tenant to avoid problems.

  • Dedicated systems to help mitigate risk and maintain your property efficiently.

  • Property inspections which identify potential risks of the property including those in regards to health and safety.

  • Eviction prevention.

  • Swift and timely processes.

 

Now, let’s discuss these three pitfalls in a little more detail so you can better understand your risk and take the necessary steps to get your property professionally managed.

 

  1. County and City Compliance

 

The first pitfall we mentioned is proper compliance with county fair housing and regulatory rules and regulations. Ensuring that you comply with these standards and rules can often be a complicated task, which can put an owner into an expensive and time consuming problem-solving process.

 

  1. Improper Lease Documentation

 

The second biggest pitfall is improper lease documentation. You’ve heard it said that getting your agreement in writing is everything—and we couldn’t agree more.

 

However, we’ve seen many leases obtained off of the Internet which don't comply with state coding regulations nor do they provide the needed protection for the owner.

 

These documents are not only incorrect but dangerous for your investment—in combination with a bad tenant and a bad lease, it can be a challenge to defend yourself in court should a problem arise.

 

  1. Getting a Bad Tenant

 

The final and biggest pitfall for an owner managing their own property is a bad tenant. Often, tenants are not properly screened to include criminal, credit, eviction, and the ability to make payments based on many financial factors which are crucial to a successful approval process.

 

We are often contacted by landlords with a defaulting tenant to discover their lease doesn’t even comply with the correct code nor was the tenant properly screened. The monies lost in a situation like this could have covered property management fees for two to three years let alone the lost revenue and anxiety of an eviction.

 

As you can see, the idea of an investment property can quickly turn into a disaster if your property isn’t professionally managed. Even experienced property investors can make mistakes with leasing paperwork, proper tenant screening, and complying with city and county codes.

 

In order to ensure your investment property stays exactly that—an investment—you need seasoned professionals who miss no detail when getting you the perfect property, airtight paperwork to protect you in court, and the best tenants who’ll pay their rent and take care of your place.

 

Interested in finding out more about professional property management to minimize your investment risk? Find out more here.


Reasons to Use a Property Manager to Purchase Your Investment Property


Eric Guggenheimer - Monday, June 05, 2017

Investing in a property is a big decision. You want to consider all the details when it comes to buying a property for the sole purpose of using it as an investment.

 

For this, it helps to have people who know all about investment properties and the benefits, challenges, and risks they represent, namely professional and experienced property managers, such as Circle PM.

 

People who are new to investing will often buy a home they’re emotionally attached to rather than one that represents a good return on investment (ROI). When you work with property managers to buy your investment property, you can evaluate the home for its return on your cash rather than just its curb appeal.

 

Here are the top reasons why you should use a property manager to purchase your next investment property rather than going at it alone.

 

Get a Trained Eye on Your Potential Property

 

What do you look for when you go see a house?

 

Do you look at the hardwood floors, granite countertops, or the size of the closet in the master bedroom?

 

This is the eye of a home owner but not that of an investor. Property managers look at real estate from the prism of an investment. They scrutinize real properties for their ROI and their potential to be a great income property for you.

  

Property managers use their critical eye to evaluate the risks, like condition of the mechanical equipment, age of appliances, and any potential risks due to health and safety. These are all important and may not be apparent to investors who don't have experience in this area.

 

Getting a trained eye on your potential investment can help you see the property for its monetary worth rather than its sentimental worth.

 

Understand the Costs Involved

 

When you have a property manager analyze your potential property, they’re looking for more than ROI and its appeal to prospective tenants.

 

Property managers review the potential maintenance costs over the term of your investment. There are many factors that affect the costs associated with maintaining your investment. These include regulatory concerns as well as requirements by associations (HOAs).

 

These details may seem insignificant but can quickly add up. In order to better understand the costs involved, it helps to have a professional who’s familiar with each and every detail of a potential investment that could cost you.

 

Knowing the costs before you make the purchase can help you better evaluate your options when it comes to securing the best investment properties for you.

 

Evaluate Any Potential Challenges with Tenants

 

Your tenants are going to become the hub of your property investment. This means keeping them at the front of your mind when evaluating a property is essential.

 

This is where a trusted property manager comes in. They examine things like the rules and regulations of condos and Home Ownership Associations (HOAs) in order to see what challenges, if any, will be faced by a prospective tenant.

 

A property may look great on the outside, but properties that are not tenant friendly can lead to delays with placing a new tenant.

 

Property managers also examine the ease with which you’ll be able to rent your property. Some properties pose challenges with renting, which will cause a loss of potential income and a higher rate of vacancies. Others are easy to rent and will offer you the most return on your investment.

 

Considering Purchasing Investment Properties? Talk About Partnering with Circle PM

 

When it comes to buying your next investment property, trust an experienced property manager to evaluate the home for you. Will it appeal to future tenants? Will it be easy to rent? And most of all, will it be a good investment?

 

The property managers at Circle PM can help you answer all these questions and more!


2016 Year End Rental Market Condition Report


Eric Guggenheimer - Wednesday, March 08, 2017

Circle Property Management has closed the books for 2016 and now we reflect on the positive events throughout the year. There was some surprising moments as well as positive numbers for the rental market compared to 2015. The year started strong but stalled in September, October and November.

We did have a surprise bump in December which we attribute to the end of Presidential Election of 2016. November was our worst month year over year with a 23% drop in units-rented. We recovered nicely in December with a 7.8% increase over last year. Overall we saw a positive year as reflected in the data below.

Average Rent rose again in 2016 compared to previous years

Comparison To Last Year

Compared to 2015 we are positive on all the numbers with the exception of units rented "as an average". We were down 3.8% on units rented year-over-year but all the other statistics are in positive territory. Reflected below is rental statistics which is either positive or negative to the market.

Looking Towards 2017

After we reflect on 2016 our thoughts now look towards 2017 and the overall mood seems to be positive for Real Estate.. Sales were positive in 2016 exceeding "sales 2011 through 2015". On the chart below the black line with green squares represents homes sold throughout the year in 2016 compared to the past 5 years and it's apparent that 2016 was a good year to sell a home. We have heard that many of the sales fell through representing over thirty percent of all contracts that never went to closing. This high failure rate was due in part to rising interest rates and concerns about the economy, pre-election.

Washington Area Economy

With the election behind us and a new president, we see both positive and negative potentials which could effect the local economy. It's still very early to anticipate the outcome but we will follow this closely. Our only concern is the hiring freezes in the Federal Government and one would expect some caution with housing among Federal employees. We depend on new employment to drive growth and a robust rental market.

UNITS SOLD 2011 THRU 2016

If we continue the sales trend our market should improve as we start the spring cycle. We have not seen much negative correlation between sales and units rented but have felt from time to time, when tenants consider renewing a Lease we lose some to a home purchase. Overall our outlook is positive but will keep an eye on the numbers.

We have placed a data chart on our main page of http://www.circlepm.com towards the bottom of the page. We still maintain all the spreadsheets and monitor the MLS every month but limit the commenting to specific events. All of the data we extract is form our MLS system (MRIS) and still use Excel to present the data and charts.

2016 October Rental Market Conditions Report


Eric Guggenheimer - Wednesday, November 16, 2016

October is following a steeper trend started in September. The downward trend began in July and has seen a steady decline every month. This is compared to units rented in 2015; we are seeing levels similar to 2012 and 2013.

Units rented compared to 2015

  • July -1.8%
  • August -1.4%
  • September -12.3%
  • October -16%

Active units compared to previous years

On the positive side, inventory has not been impacted like last year. Our inventory for active listings as of October is below 2015.

  • October 2015 -19%
  • October 2014 -13%

Market temperature

We have spoken to clients and associates and feel the downward trend may be a symptom of the election year cycle. Although 16% drop in rented units is high, we’ll have a better understanding on the direction by the end of the year. We still have a couple of months of data to process and we can declare a trend in January.

Do Home sales affect the rental market?

The sales market seems to be affecting our numbers seeing the best year in sales since 2006 per our MLS provider. As consumers look to buy we lose them from the pool of renters and it’s difficult to quantify how sales impact the rental market but we know from experience a good year in sales affects us all.

Market Condition Report

Market update 2016 January thru August


Eric Guggenheimer - Wednesday, September 07, 2016

Our region and all of Fairfax County have performed well in comparison to 2015. We have seen small gains in Average Rent, improved Days on Market, with a significant improvement with Active Units. The quantity of Units Rented has remained constant through out the years, with very little difference year over year. The variable in obtaining the maximum rent; is effected by the quantity of units available (Active Units) and to a small part the units sold. When there is excess inventory we do see a decline in average rent due to the competition which was evident in 2015 as compared to 2016.

  • Average Rent has exceeded 2015 by 1.2 percent (2016-$2273 2015-$2219)
  • Days on market improved by 7 percent as compared to 2015. (39.63 vs. 42.6)
  • Active units has declined by 21.5 percent as compared to 2015 (1191 vs. 1450)
  • Units rented increased by .5 percent as compared to 2015
  • Units sold has increase by 6.7 percent as compared to 2015

Circle Property Management tracks the market as part of our overall process for evaluating the rental market, helping our clients better understand the cyclicality of the market and the timing. 2015 has been a good year overall with very few major issues with marketing.

Maintenance and Repairs

As of August we have seen a significant rise in maintenance and repair requests exceeding 2015 by 27 percent. The increase was not based on dollars rather it is based on work orders processed. We attribute this to the aging of our portfolio of homes and there seems to be a pattern of every seven years. We have been seeing some sort of Appliance or HCAC system problem at 7, 14 and 21 years. When ever we process a major work order we look at the age of the appliance and the age of the home and inevitably it’s falling into the seven, fourteen, twenty-one year range. I have spoken to my major vendors and their feedback is of a similar conviction, indicating the quality of products is just not what they used to be. My main HVAC contractor has told me that most of the compressors are now manufactured in Taiwan and in my own observations I have noticed the compressors look much smaller and less sturdy looking than before.

We have renewed our contract with our HVAC contractor and they had a small price increase for new systems due to mandated efficiency requirements. We have a flat rate for the following:

  • New 14 Seer HVAC system up to 4 ton AC $5,500.00
  • Recharge AC (up to 1.5 lbs refrigerant) $350.00
  • Clean coils $300.00-450.00

For detail chart Click Here

2015 Year End Market Condition Report


Eric Guggenheimer - Wednesday, February 17, 2016

Rental Over-Supply, reverses trend in November vs. December (17% + above average supply)
The Rental and Sales market for 2015 was interesting to say the least. We have seen the supply of rentals go from a high of 20% above average supply to parity by the end of the year. This has been a marvelous reversal of a trend we began to worry about mid-year. 

Average Rent Charged Slightly Higher in 2015 (Just ½% higher in 2015)
Despite the average rent charged ending the year above 2014, it was a very bumpy ride. The first half started to move above 2014 but as the over-supply started to affect the market we saw a decline in average rent charged in June which severely effected the days on market as seen on the charts. November was our worst month but it did bounce back in December. 2015 was a break-even year coming in at $2219.50 which is just $7.17 more than last year (See chart on page 2 & 3)

Average Day On Market (12% higher than 2014)
The average days on market tells the story best. Due to the excessive supply “the time a listing was on the market” was extended on average 10% over the year. There were several months where the days on market were in excess of 25% more days than the previous year. (See Chart on page 6)

Homes Sold 2015 (9% higher than 2014)
The over supply does not tell the whole story about the softer rental market in 2015. Over the past 5 years, 2015 will be a record year with a total of 14,363 units sold. This represents an increase of 9% over 2014, 1 ¾% increase over 2013, 6.8% increase over 2012, and a 16% increase over 2011. We do feel the sales are part of the overall picture and some prospective tenants decided to purchase rather than continuing to rent. This may be a symptom of rising rents over the past 15 years. As rents begin to reach a point in which a consumer can purchase for less than rent we will potentially see a decline in rents charged. Despite the rising rents we do feel this will not affect 2016.

November 2015 Market statistics for rentals and sales


Eric Guggenheimer - Tuesday, December 08, 2015

The rental market has seen a shift to lower supply but we have seen evidence of the over-supply effecting Rents in 2015 based on the average rent chart below.

Because the supply was high in the first half of 2015 we saw a much more competitive rental market resulting in lower average rents for November.


As the inventory declines we should start to see some improvement in the average rent. In the chart below you can see in yellow the decline in inventory more in-line with 2014. We did see a spike in activity in November which in part is due to the decline in sales. (next chart)


In the chart below you can see the decline in sales between October and November and an increase in units rented in November. We are not sure how the sales have affected the rental market but simply extrapolate the data. In conversations with Realtors we hear the market for sales have dramatically decreased.

In conclusion we feel 2016 will be a stable rental market and we suspect sales will decline as interest rates start to rise.

This report is prepared monthly with data collected from MRIS. Circle Property Management is a Licensed Broker and a member of NVAR, a licensed user of the MLS service provided by MRIS. We make every effort to collect the data but provide no guarantee of the statistical data in our charts.

Prepared by: Eric Guggenheimer


Areas We Service

TELL US HOW WE'RE DOING

Review Us

Contact Us

Circle Property Management, LLC
9520 B Lee Hwy.
Fairfax, VA 22031

OFFICE: 703.349.0144

FAX: 703-349-7822

Virginia Lic # Firm Lic: 0226-024470
Washington DC Lic LL98375649

Alexandria Property Management | Alexandria Homes for Rent | Cities Served
Copyright © 2017 Circle Property Management. All Rights Reserved.
Website by PMW | Sitemap | Contact Us