francissaunar1

Spring has sprung!

Wed, 29 Apr 2026 14:14:10 GMT

And yet another spring market is upon us… what is it bringing for both buyers and sellers? Well, to begin with nationally, slightly lower mortgage rates in the spring season have begun to thaw potential seller’s minds about leaving those low rates and selling. Nationally, there is an increase in inventory as a result. Locally in RI, however, inventory remains tight, with only 1.9 months of inventory available where a balanced market is considered to have 6 months. Trends are predicting sale’s prices will unsurprisingly continue to climb upward. The local condo market continues to become more competitive, with sale’s prices pushed upwards as single family homes are just not an option anymore for many buyers. Given these trends, there is no compelling reasons for either buyers or sellers to wait. Your buyer may have to consider options like a condo or a fixer upper in order to get into the market. But, waiting it out seems like will just bring higher prices.

Rent control… what is all the buzz about?

Fri, 27 Feb 2026 20:48:29 GMT

Rent control is a government program that determines a fixed amount private landlords can increase their rents year after year. Municipalities enforce it. This is not a new policy and its origins date back to the 1920s where it was enacted to help curb the effects of inflation on rising rents; a similar problem we face today. The Providence City Council is voting to enact rent control, even though this policy has shown so many flaws over the decades since its first introduction. And, it comes on years of anti-landlord legislation being proposed and in some cases passed by our legislature. A stronger RI economy will only benefit every resident, including renters. All these measures will only undermine the economy. I wish our leadership would focus on the basic principles of supply and demand and work tirelessly to increase supply. Work with local developers instead of detracting investors to engage in this state. How about provide incentives to landlords to offer below market rents instead of creating artificial freezes on a free market system? What will RI look like if our housing depreciates in value? Guess what tenants will lose too along with home owners now as well.

Rents fell for the 27th straight month year-over-year and the third consecutive month-over-month according to Realtor.com’s October Rental Report

Fri, 19 Dec 2025 20:31:02 GMT

Yes, it is true we have also experienced decreased demand for our higher end rentals for over a year and have been paying increasing attention to pricing them just right. Providence has generated many new upscale rental buildings that have amenities like gyms and security. We recently did a rental in a three family- a nice one but one without any amenities- and tried to explain these factors. It sat and when we looked further, Zillow showed 56 comparable rental listings. That is a lot of inventory for Providence especially this time of year. The drastic increase in rent prices was driven by a shortage and many rentals that served working and lower class tenants got new kitchens and bathrooms along with huge rent increases and targeted a different tenant pool that had historically not lived in these neighborhoods. Now, demand is shifting to these newer buildings. Over time, this will return rentals that once housed working class to them and ease the rent burden on these tenant pools as well. Supply and demand do drive but it takes time. There is still a huge need for working and lower class rentals and this rental category is still experiencing price increases and shortages. But, the easing at the top will help.

The next great market crash is…. Insurance??

Mon, 05 Feb 2024 14:12:17 GMT

You are not alone if you have noticed that the typical 4% annual increase in your home owner’s insurance is a thing of the past. Some are thankful just to have a policy. With increasing volatility of extreme weather related property loses, the insurance market has been reeling and the vast majority of us have been paying. Time will tell if extreme weather will become increasingly the norm. And, if it does, how will the insurance market react? In Florida private insurance companies are mitigating loses by closing shop and the state sponsored insurance has become the biggest carrier. This translates into higher costs for home owners and/ or greater risk as more homeowners opt to forgo insurance altogether. Again, this burden will disproportionately affect middle and lower classes as homeownership becomes elusive in its affordability or even practicality. Although I am not a big advocate of increasing government involvement, this is an area homeowners should get assistance.

30 year mortgage rates slink under 7%….

Fri, 15 Dec 2023 18:32:20 GMT

So, the Federal Reserve met this week and kept the fed funding rate constant. Further, they hinted of some possibility that there may be 3 small rate cuts in 2024. While the fed lending rate does not directly influence the 30 year mortgage rate, the economic data around the Fed’s decisions do. It seems the Fed is ever closer to achieving that allusive economic soft landing. Consequently, we saw an immediate drop in the 30 year rate- much welcome news to borrowers. Greater indications of economic stability ahead (more “normal” fed lending rate, inflation cooling, and overall economy not sputtering) will lead to further relief in mortgage rates. How will this impact the market? Visually, you can imagine a spring that has been wound tighter and tighter emblematic of pent up demand—all those buyers who couldn’t afford to buy with high rates and all those sellers who didn’t want to leave their 3% mortgage rates: lower rates will release that spring. It is still time to get in the game now before this scenario plays out. The cost of refinancing to lower rates will be offset by potential increases in sales price from pent up demand.

Rents!?

Fri, 29 Sep 2023 15:13:22 GMT

Have we finally hit a ceiling? For the first time in years, some of our rentals sat. Sure, our priced right rentals aimed at middle and lower class renters were still swamped but higher priced rentals have become stagnant. There is still a lack of inventory but, with many new construction rental buildings in the Providence area, some of the edge of at least the higher end market has been softened. This will benefit middle and lower class renters, as units they traditionally habited that became priced out of their range, will slowly become available again. Investors will need to plan accordingly and remember Zillow isn’t the bible- it takes more a temperature of what rentals are being offered at, not how long they are sitting. I think it is time to be more realistic with rent prices and pray that everyone who bought high can still generate adequate cash flow. After all, we do not need any more instability in the housing market.

"What’s all this about zoning?

Thu, 10 Aug 2023 19:50:06 GMT

It has been in the news a lot lately… and, yes, it is true zoning trends can lag or even create housing needs. Single family zoning laws, borne in the early 20th century, became more restrictive with the growth of suburbs in the 1970s in an effort to protect residential home ownership from any negative impacts on its value. Now, there is need for a change with the limited housing supply and limited buildable lots. Thankfully, RI Legislature has been up to something good. Next year, new laws will come into effect enabling previously unbuildable lots to be buildable. RI isn’t throwing away all caution and normal processes remain in place to make sure lots are suitable. But, for substandard size lots, as long as they are a legal lot on record, setbacks would reduce by the ratio of the actual versus allowed lot size. This is just one example and there is a lot to digest but the intent is to create more housing with incentives to build affordable housing. Drafted primarily by Johnston town planner, Thomas Dellar, this type of out of the box thinking will give RI a legs up to address affordable home ownership. More to come and hopefully we will have some new houses under the works in 2024! "

Goings on at the RI Legislature…

Thu, 29 Jun 2023 15:23:04 GMT

Session just wrapped up and we were left with a whammy: as of September, you can no longer evict without a lead certificate. The lead law reads every unit must be inspected every two years regardless if you turn over a tenant or not. So, while this is pretty straightforward when you have a tenant turnover, what about those not so clean long term tenants that don’t like anyone in their unit? Or, the ones that changed a lock and got a dog? Keeping units safe for tenants is one of our pillars but it isn’t always a straightforward process. We walk through units twice a year to look for unsafe conditions like peeling paint. But, with our old housing stock, we have to count on tenants too to inform us if there is an unsafe condition and also be somewhat clean. For example, what if a tenant’s child had a tantrum and threw a hardball into the wall? Now, the older underlying layers of paint have been exposed and small particles of lead dust fell on the floor next to his baby brother’s toys. Baby brother comes over to watch his older brother try to hide this hole and unknowingly rolls his own toys back and forth through the lead dust. As older brother frets how to best hide the wall hole, baby brother starts mouthing his own toys (he is teething) and has ingested lead. It takes that little for a lead exposure to occur. A couple months is going to be tough for landlords and our 16 lead inspectors to get up to date.

The spring market is splat!

Fri, 05 May 2023 15:59:54 GMT

The party is over, the hangover lingers. Neither buyers nor sellers are particularly happy in the moment. But, if we have any hope to preserve middle class home ownership, now is the time to stay on course. The inflationary spiral took the reality of home ownership away from many. Now, we look at high prices and high rates and even fewer can buy. But, the high rates have already slowed the pace of price increases and the rates will not remain high forever. Indeed, most expect some leveling off by end of the year although our newest financial bump in the form of bank failures has certainly made this trajectory less certain. I don’t doubt the resiliency and health of our economy. I worry our political leaders will lose sight of the fundamental need to create/ enable affordable home ownership. The middle class is the backbone of our society. Lack of affordable home ownership erodes the middle class and leads to a greater wealth gap. Ultimately, this is just bad for everyone with an overall reduction in American productivity and, perhaps, just as importantly happiness…. Buyers and sellers let’s deal with the pain now and hope it lessens a bigger problem.

Bonds, bank failures and rates… what to do?

Fri, 17 Mar 2023 19:35:58 GMT

Earlier this year, there was some confidence that long term mortgage rates may get below 6% by the end of the year. It seemed at this time the Fed found the magic formula to tame inflation while achieving that soft landing for the economy but stubborn inflation date followed with an uptick in mortgage rates. Now end of the year predictions are just a field in the high fives to low 7s depending who you ask. Many are fixed on the Fed’s next interest rate move after this week’s bank failures. A freeze in rate hikes would provide short term relief but be harmful in the long term as inflation is still sticky. The Fed’s uncharacteristically blunt message to date is there will be pain in the quest to calm inflation. Obviously, we feel that pain in the real estate world and SVB bank failure is another example. My guess is the fed will hold true to their message and at least do a .25 hike. And, I think that is a good sign for our economy: the fed has the right tools to steer out of a pandemic, handle bank failures, a war and supply chain issues without sending our economy into a tailspin. In the real estate world the giddy days are behind us but that’s a good thing in the big picture. We need more supply and affordable home ownership.

Are you ready for the spring market?

Thu, 16 Feb 2023 05:08:16 GMT

At this point, it is pretty safe to say the big crash isn’t happening. Interest rates have stabilized with some models showing the 30-year rate will dip into the 5% range by end of the year (bank rate, cnbc). Historically, this isn’t bad. Inventory still tends to be an issue but the days of crazy bidding wars are behind us. So, if you are a buyer what can you expect? The golden time to buy is elusive still but buyers can at least expect a mild reduction in sales price or an end to dizzy price hikes. It will be more pleasant to buy with less of a frenzy and proven practices like home inspections becoming a norm again. Is it smart to buy? Locally, high rents and lack of inventory can make buying a home instead of renting the best move. With today’s average rate of 6.8%, a mortgage payment on a $240k house is about $1600. When taxes and insurance are figured in that is going to be pretty comparable to what rent on a similar house would be. Answer is yes!

2023 is here!

Fri, 13 Jan 2023 01:19:47 GMT

I am real interested to see what the spring real estate market brings us. Inventory still an issue. Rates are at least hovering somewhere in the 6% range which historically really isn’t that bad. But, in today’s market after years of head spinning price increases, the relatively higher rates still price many buyers out of the market, And, make potential sellers with lower rates are loathe to sell, further contributing to lack of inventory. Rents are just high and rental inventory is a big issue too. In over 20 years of business, I have never experienced such low vacancy rates for our own rentals. So, again, potential sellers will be reluctant: why trade in their low rate mortgage for high rent or a costly mortgage when there are still not even a lot of options out there to buy? In the least, the buying experience will be more pleasant: fewer bidding wars, waiving of inspections and above asking bids. So, if you need to buy, keep an eye on rate trends, as even a ¼ of a point matters, have some patience and have a good realtor by your side to find you a deal!

Rhode Island Real Estate: A Paradox

websitebuilder@thryv.com — Thu, 01 Dec 2022 14:22:24 GMT

We find ourselves in a standoff between sellers who know inventory still isn’t what it should be and buyers who either can’t afford prices with increased rates or are waiting for the bargains to come. Even though sale price declines are happening, after the last two years of record increases, any adjustment is relatively mild and obliterated by high interest rates. Who is going to win this battle? The answer lies in the health of our economy and how severe any recession will be. Consumer spending is started to rack up on credit card debt as stubborn living costs remain high. But, on the other hand, the labor market is steady. If the Fed achieves this soft landing, real estate prices may just remain high albeit with the huge annual increases left in the past. Inventory will remain a problem: many will be loath to give up their historic low interest rates by selling, many won’t sell because they can’t afford to buy again, and builders have cut future development plans way back or stopped altogether. Without careful planning, home ownership will remain an elusive goal for many in historic proportions.

Adriana Rodrigues

Office Manager

Divine Investments Inc.

222 Broadway

Providence, RI 02903

401-272-6722

What in the World is in Store For Us?

Thu, 20 Oct 2022 13:47:35 GMT

Trying to predict our post-pandemic reality is confounding. More than ever global factors continue to have major sway: Ukraine, China’s covid policy, droughts and food shortages. Here in the US, it seems we are in for some pain but more or less remain fundamentally strong. Now presents itself as a good time to prepare to buy with an eye on what next year will bring. After all, higher interest rates can always be re-financed. Forecasts predict price reductions all over the place. But all markets- including housing- can be emotional and that impacts how far a downturn will take. Fear, unfortunately, is a factor. Lack of supply has not changed. Price reductions forced by higher interest rates were needed. A country that has a middle class who cannot afford home ownership just isn’t healthy. What remains to be seen is how rising costs of everything impacts foreclosure rates. Pain is in our future. The question is how much and this will directly impact our local housing market.

Up, up and away!

Tue, 20 Sep 2022 21:10:20 GMT

Interest rates are wreaking havoc on buyer’s budgets and seller’s prices. Will the fed’s fight to get inflation under wraps achieve a more balanced market? Or, will doubling mortgage rates in less than a year have more dire consequences? In the least, inventory has corrected half way to a healthy 6 month inventory level. Price drops are now much more common than bidding wars. If only buyers could heave a sigh of relief but higher rates just make an albeit less aggressive buying pool more limited. Potential sellers who won out buying with historic low rates would really need a strong motivation to consider selling right now. And, pandemic lifestyle changes may be less permanent as we thought. The pandemic is “over” and cities can be lived in again. This will further lessen the demand on the single family market and open doors to urban living. The fed has certainly succeeded in easing demand but can it continue this path without destabilizing the real estate market and the economy altogether? Still hoping for that soft landing.

The delicate dance of balance.

Mon, 25 Jul 2022 21:32:22 GMT

Is the fed going to get this “soft landing” right? How do we continue to correct for a historic supply side shortage of housing if builders lose confidence? I do agree rates should increase but the speed and magnitude seems lacking in the finesse needed for this “soft landing” just as much as the oversupply of “free” money contributed to inflation in the first place. The housing market was the bright star in the pandemic economy but house prices did just get too high. Supply has eased up in the last months but we are still so far from the happy median of 6 months’ supply. Builder confidence dropped sharply in the last month reflecting the reality that with rising rates there are far fewer buyers who can buy. The cost to build remains extremely high and locally in RI we have just made it even harder to find suitable land to build with new DEM guidelines for wetland’s setbacks. It seems we have created a market where buyers still struggle to buy; prices may come down next year and help this problem some but will they come down enough to counterweight the higher costs of changing interest?

Beauty in the eye of the beholder

Tue, 14 Jun 2022 04:13:56 GMT

We often think about what we should look for in a condo... and, of course, what one may want to avoid. How about those beautiful old buildings that have conveniently made to have below grade living spaces? If only we could see behind those walls, the stories they could tell! One such beauty had a flawless inspection only to wreak homeowner havoc mere months forward. Multiple leaks into the below grade living space (only one leak was actually visible) left rotted wall frames and necessitated a good gut of this space. Now as termites do love their wet wood another side of the same building had neatly disguised termite damage. In this case beautiful masonry work on the exterior didn't account for the proper pitching of water and with so much beautiful masonry and not a lot of porous surfaces this need was critical. Fast forward a decade and voila the damage was done.

How big will this market correction be?

juniortekkis12@gmail.com (T Mizzula) — Fri, 20 May 2022 13:16:14 GMT

We’ve got projections all over the place. But, the more sensible ones keep coming back to evaluate your own local inventory levels. You’ve heard the saying: “all real estate is local.” But, it’s also time to head the uncharacteristically blunt messages from the Federal Reserve: rate hikes are imminent until inflation is less than 2%. Their gloves are off and they aren’t ruling out greater than ½ percent point increases to get there. This changes the calculus of how much a buyer can afford on an unusually frequent basis. Mortgage applications for purchases are down by 12% nationally from the week before- no surprise there- the point of these rate hikes is to cool the market. The economy is still strong with high consumer demand and a vibrant labor market but supply chain woes are going nowhere: Ukraine, China’s zero-covid policy and droughts in India wreak havoc. What will the net impact be of our own rate increases when we have no control over these global trends compelling inflation? Will it be the dreaded stagflation or the much hoped for “soft landing” the fed prayers for? All of this makes for an increasingly unpredictable market.

The two I words: Inflation & Interest rates…

Wed, 04 May 2022 13:37:21 GMT

A 2 point increase in rates is hard to ignore even in the hottest of markets. What impact will this have? Right now, it depends on the market and, where there is simply no supply coupled with higher rents, not much. 5.5% percent is historically still a great rate and sure it’s a hard pill to swallow when rates were in the threes just months ago but, with more rate hikes on the horizon, it may make the spring market all the more intense. Recent data released in RI, shows inventory fell to less than a one month supply (if no new listings came on the market, all the inventory would be sold in under a month). Whereas, a six month supply is the golden rule of a balanced market. Still, rising home prices and rates will make force some buyers out of the market and will do what the Fed intended to cool rising home prices. At the end of the day, we need more supply: rentals and home ownership options. Here’s to hoping bright minds will align to solve this problem before our middle class is pushed further out of ownership.

What is up with the RI legislature

Thu, 14 Apr 2022 13:26:25 GMT

It is every week a new bill is introduced that is anti-landlord. Landlords are not responsible for the affordable housing crisis in RI. Solely focusing energy on restricting landlords’ abilities to maintain rental properties will make this state less attractive to invest in. This translates to less tax revenue and less money to generate affordable housing units. We need supply! H8078 changes the timeline of evictions. Right now the process is fair. Tenants have a sympathetic ear in housing court if they need one. H7466 limits rent increases to 10% annually. While many may nod their head in approval as we all struggle with inflation, what about landlords like me who maintain low rents until a turnover and then bring them up to market? Limiting my ability to adjust to market means I have less money to spend maintaining the physical property itself. We are all dealing with old housing stock here. H7683 spells a security deposit can be paid over 12 months. No words for this one. H7894 another personal favorite- landlords have to register their personal address with the secretary of state. Now, I have family too and having had tenants personally threaten me before- just how is this safe? There are many, many more and not everyone is terrible. The lack of business sense though makes me cringe. We need this state better for business- not worse- and that will help everyone- landlords and tenants alike.

The 2022 spring market- time to buckle your seat belts (again?)!

Fri, 18 Feb 2022 14:07:05 GMT

What will this spring bring? Predictions range from a year over year increase of 3.5% to a whopping 21.6% percent. Zillow leads the pack with its heady 21.6% price increase prediction and it’s simply back to basics: supply and demand. Supply decreased over the winter months and we already were at an unhealthy inventory low. Omicron probably kept a lot of would be sellers staying put and buyers simply don’t have anything to choose from. What dampers some predictions such as Core logic’s 3.5 percent predicted increase? The other biggy: demand. Mortgage rates are going up and many buyers will simply be out priced from last year’s huge increases. The contention is with such a lack of supply there will be other buyers that will step in. Thus, the division in predictions for this spring market. Poor buyers- how can one possibly plan? It’s just not an ideal time to buy- with the exception interest rates are still historically low- but buyers should also weigh supply and demand dynamics are not going to shift in their favor for some time. On the local front, Divine will have one very beautiful colonial coming up on the market in weeks and another one in construction!

What goes down must go up?

Wed, 26 Jan 2022 21:27:12 GMT

Well, yes, we couldn’t enjoy endless record low interest rates. But, still the likely four adjustments this year will take us from record low rates to slightly higher record low rates. On the other hand, following a year where housing prices jumped 20% and entering a year where they are expected to jump perhaps another 7%, even a slight increase in rates will reduce buying power. You can afford a higher purchase price with a lower interest rate. The squeeze on the middle class continues with no end in sight. The housing market has been a main propeller of the pandemic economy and federal monetary policy has been loath to do anything to dissuade it. However, inflation is at a point where it can no longer be considered transitory and the adjustments are needed. What does this bear for the 2022 housing market? I think it will be less heady than 2021. 2021 buyer remorse is high among younger buyers- many of whom may have paid more than they really should have in 2021. Again, the basics of supply and demand and well vetted loan applicants will keep the housing market strong, stable and still a seller’s market.

Good bye 2021...

Wed, 29 Dec 2021 14:15:37 GMT

2021 has been lurchy. In real estate, we have delighted in yet another exuberant seller's market with promises of more to come. Daily business life has been confounded by labor shortages and pesky supply chain issues. But, what strikes me the most has been the affordable housing crisis. With inflation, lower and middle classes struggle to find affordable rentals and the squeeze continues on middle class home ownership. I have written about the k shaped economic recovery from the pandemic and these real estate trends will only lead to greater division in the haves and have nots. I don't see any meaningful change in supply and truly it would take a lot of new units to impact this calculus. My advice continues: buyers stay focused and think out of the box. You will continue to face out of state buyers driving prices up and aggressive tactics like waiving inspections. I at least welcome 2022 with reduced quarantine times and a couple of new construction houses to add to our local RI supply!

What is it with inflation?

Tue, 07 Dec 2021 15:35:40 GMT

Economists now seem to agree inflation isn’t transitory and should be expected to continue into the end of 2022. Covid is still creating supply chain bottlenecks exacerbating price increases. But, what else is driving inflation? Raising wages. So, interesting that in what one could expect to be a troubled economy that businesses still struggle to find help and pay more for the help they do find. Supply chains woes are expected to ease toward 2nd quarter next year but has a substantial change in the worker’s mindset altered our economy? The pandemic spurred introspection and record amounts of Americans resigned (4 million in last April alone). Suddenly, it just isn’t worth it to do what you have been doing for how much you have been doing it. Businesses are in a corner as many got comfy living on pandemic assistance and even when it ended in September, there hasn’t been this flood back to the work place. People have found other ways to make money. Real estate is also fueling inflation as sales prices continue to go up, up and up. I don’t see any immediate change as inventory or lack of is still a fundamental problem that will take years to correct and the pandemic drives the need for more space. In a nutshell, expect prices to continue their rise across the board.

Follow those trends!

Tue, 23 Nov 2021 14:06:53 GMT

Sometimes it pays to be friendly. Through many casual encounters with a local developer responsible for many new rental units in Providence, we developed a comradery. Last chance encounter, he confided that he had potentially planned 500 new rental units for Providence (after his 200 in the last year or so). We both agreed this would feed the trendy crowd in part responsible for driving rents up in our local area where families had traditionally lived. He concurred the talk had been with the city to let his new rentals fill this need and let the three family rents correct themselves from a meteoric 50% increase in the last handful of years. But, what does that mean for the newer small mom and pop landlords who own a chunk of these multi-families? Probably nothing in the short run but years out, start to plan now for a correction in rents. Hopefully, many of these first-time owner landlords will be prepared. Always pays to keep your ear to the ground and remember there are many factors driving real estate.

Inflated?!

Fri, 12 Nov 2021 14:34:39 GMT

Yet again it's an interesting time to run a business. Costs to run one keeps going up and supply prices have so much volatility, estimating jobs has taken a whole new level of complexity. It's invariable when talking to one of my subs, we get into a back and forth over how much a particular type of wire or piping or fill or paint or a lowly piece of plywood has increased. The cost of labor has also gone up but not enough to keep up with this spiraling inflation. We can argue back and forth about politics or listen to the tempered voices of some seasoned economists reminding us a post-pandemic economy is going to have some bumps. But, in the here and now we all have had to make adjustments. In the world of real estate, in the last year alone, the cost to build a standard three bed, 2.5 bath house has gone up some $45,000. Now, prices have almost gone up as much and we still have supply issues. But, if wages aren’t increasing as much, are we building houses no one can afford? And, again what about the middle class? Personally, I can’t wait for all these supply chains to work in the efficient manner that is the hallmark of our economy.

Vendors are busy right now?

Fri, 05 Nov 2021 15:00:11 GMT

If you aren’t getting call backs, there is a reason. As a property manager, we are often beholden to get a few estimates for larger jobs. And, that is still fine if you have time. But, if you are trying to get a roof replaced this fall, you may just have to settle or more accurately be happy with a vendor you have used successfully in the past. Supply prices are very unstable and everything costs more than it did a year or two ago. But, the labor market has also changed dramatically. Vendors have been having a tough time getting people to work or finding new help. And, if they do, one things for certain, the new hire is getting paid a lot more. All these shifts have made running a business more challenging than ever. Some vendors aren’t even taking on new customers and are just focused on keeping their existing operation afloat. Remember we are still in pandemic times where a lot of people are spending their vacation money on home improvement projects. So, while demand has gone up for the construction trade, the ability to find help has gone down. Plan projects ahead! The body content of your post goes here. To edit this text, click on it and delete this default text and start typing your own or paste your own from a different source.

Rent relief is it?

Thu, 14 Oct 2021 04:30:04 GMT

If you are a landlord or tenant you most likely have heard of the very popular “rent relief” program- the reboot of “safe harbor.” Well, guess what? Rent Relief is running out of money too just like Safe Harbor did. And, that totally doesn’t surprise me. One of my own tenants had a legitimate loss of income related to Covid at the beginning of the pandemic- he was an Uber driver. He was approved under safe harbor but didn’t get paid under them when they ran out of funds. We got transferred to rent relief and a year later got paid. So, why do I have an issue? Because his rent relief payment paid all his back rent plus three months forward. Now, his loss of rent was from the beginning of the pandemic and the life of an Uber driver is happening again. I know of another landlord who is falsifying 5 days and showing his tenants owe much more rent than they do. And, of course, tenants applying with a fixed income. I mean what is their Covid related loss of income? And, when I asked for a supervisor to call back with definition of “Covid related hardship” no one did and the rep handling my call simply explained to me that it is a very liberal definition. Finally, how many landlords have gotten screwed because rent relief has mailed some payments directly to the tenants? I mean if you are handed $6k, there is ample motive to split and run. Poor landlord out $6k with no recourse. I am 150% for getting assistance to tenants who really need it. But, the sheer waste of this program just makes me sick and will leave many who actually need it without help.

Toxic condo associations- is condo living for you?

Sat, 18 Sep 2021 15:40:46 GMT

Rhode Island is graced by many smaller associations and they are unique like snowflakes. Some are smoothly and logically ran and building maintenance is achieved thoughtfully with future planning always in mind. And, some are not. Some are plagued by long running boards and/ or condo presidents that heavy handedly delegate building projects. And some are consumed by personal conflict between residents such that meetings become so unpleasant that more logically minded residents opt out, leaving the direction of the Association to less ideal motivations. How can you protect yourself as a buyer? Always get meeting notes. Read them. They will give you some sense of how the association is ran. Ask a few questions. Research the management company. Sometimes a phone call to management might gleam you some on the dl information. And, finally, always have an exit strategy when you buy as boards and management companies change. Even the best run associations can be turned backwards with poor guidance. Having to live next to your board members can be challenge if association life heads south.

Rhode Island sales did they get sluggish or was the spring / early summer market on uppers?

Thu, 09 Sep 2021 01:30:15 GMT

There are many forces at play within the housing market but the heavies- supply and demand- still rule. Inventory is still the biggest issue- or lack thereof. Buyers frustrated by the giddy spring market have cooled off and in many cases refused to play the high stakes multiple offers game. So, yes, the end of the summer has brought less frenzy which is healthy. Buyers shouldn’t be indulging in houses that stretch their budget. But, the fundamentals remain: there is still a lack of inventory so all this talk of a crash is unfounded. A correction sure and a needed one. Incomes cannot sustain double digit increases in sale’s prices indefinitely. There shouldn’t be much of a surprise as we see a decline in sales volume and a less precipitous increase in sales prices this fall. I’ve been seeing more and price drops as well especially in the condo market. However, as vaccination rates continue to increase and the federal forbearance programs end soon, we should expect to see some much needed inventory coming soon to the market. However, it’s probably not enough to offset another emotionally charged 2022 spring market.

Got your briefcase out? Not so fast...

Thu, 19 Aug 2021 20:08:30 GMT

I was sure I would have a end of summer blog about the triumphant return to office life. Months back many of us were relaxing in newly vaccinated life but how has Delta impacted this ebullient vision of the fall? Heavy hitters Google, Apple and JP Morgan are all rethinking September office re-opening plans, pushing back tentative dates and considering flexibility for hybrid work from home models. So, if you are in the world of commercial real estate, predicting how you will fill or sell your office buildings appears to remain an unsettled affair. Indeed, some might argue Covid has prompted a seismic cultural shift in the American work model with many preferring to at least retain some work from home hours. I guess we will keep on zooming and in the meanwhile expect a bit of a rocky road ahead for commercial office space as companies grapple with the implications of Delta.

To increase or not those rents?

Fri, 06 Aug 2021 20:08:06 GMT

It can be a delicate balancing act between maintaining long term tenants and giving rent increases. Indeed, this has become an even more relevant conversation due to the meteoric increase in rents over the last handful of years. And, there is no one right answer. Personally, I tend to give few and mild increases to my long-term tenants for many reasons. First, I bought my rentals during the great foreclosure crisis and my costs are simply less. Second, I’m busy and I appreciate tenants I don’t have to babysit and frankly put a premium on more pleasant landlord tenant relationships. But, what if you’re not in my position and you have a newer rental property? The risk calculation always is will the rent increase push the tenant out? Well, right now the rental market is severe for tenants: no vacancies, higher rents across the board. So, this is less of a risk than it has been. But, it’s always important to crunch numbers. That $50 a month increase that generates $600 annually that just really pissed your tenant off and caused them to move out, will it be offset by a new tenant with higher rent? It depends how good you are at turnovers and what your costs are. If you use a rental agent, their commission just ate up that added revenue and there are always some turnover costs even if it’s just cleaning. Take away, turnovers cost money. Do the math.

Some basics are fundamental… talking about supply and demand.

Thu, 22 Jul 2021 04:31:42 GMT

President Biden must have read my mind (or my blogs) with recent plans to meet with major players in the lumber and building in dustry as well as labor unions. Much of the talk has been rising home prices at the cost of the middle class. Already, economists have predicted a k shape recovery from the pandemic with the rich getting richer and the poor getting poorer. Home ownership is possibly the most powerful and widely used tool to move up into the middle class or stabilize your position within the middle class. But, supply of new homes is so upside down (underbuilding gap of 5.5 million units in past 20 years), government incentive would really help even the fundamental supply/ demand balance. Otherwise, the twin supply issues of under building and a generational shift in not selling homes to downsize later in life, will continue to wreak housing price havoc. Personally, I would welcome more affordable housing incentives to build homes the middle class can afford (and have room to appreciate). Typically, I support less government involvement but, in this case, the cost to the middle class (and lower class with rental prices) is too great not to intervene.

As the world turns… where does it leave us?

Fri, 09 Jul 2021 18:10:37 GMT

Back to our economy- it’s essential to have some sense of where we are headed if you want to invest in real estate. Of recent woes, more than not, economists agree that inflation is a temporary issue with supply chains still recovering from the pandemic. Overall, our economy is growing. The government’s big infrastructure package will make certain there is enough economic stimulus to keep the drive forward. The re-opening of the economy could best be compared historically to war time mode- the re-birth after the great depression triggered by WWII spending. But, it’s just not the same. The economy was healthy before the pandemic- booming even. This was not man made economic contraction. Can we control the recovery better? My guess would be yes especially now with wider spread vaccination rates and the actual ability to re-open. Expect some bumps as this is a global process and some countries simply aren’t vaccinated but in general seems like we are steadily tracking up.

What is going on with the RI legislature?

Fri, 02 Jul 2021 14:12:55 GMT

A lot of anti- landlord bills. Almost one a week. Lack of affordable housing is a very real problem in this state. Rents have increased by 50% in a handful of years. Families on a single income simply can’t cut it. More and more people are forced to live together so rent can be affordable. But, the mom and pop landlord industry in this state is not responsible to solve this problem. Bill after bill attempts to make what is already a trying job more so. I’ve been a landlord for twenty years and have had my share of wonderful and terrible tenant experiences. I need a fair and efficient legal system to support me when I need it. And, I want to be in control of the risks I take as a landlord in who I choose to rent to as it will be my loss of rent- not the states. The state should be focused on creating affordable housing so tenants aren’t in such a vulnerable position. Why are we so backwards here? Fostering a robust economy will create more tax revenue to help generate affordable housing. Stifling the landlord industry will make us a less attractive state to invest in. It’s only going to hurt landlords and tenants down the road.

Zoning, tax assessor and fire- they should all be on the same page but….

Wed, 23 Jun 2021 18:34:30 GMT

Zoning, tax assessor and fire- they should all be on the same page but….

With our old housing stock, there are many interesting twists in a building’s use that could have occurred in its 100 (sometimes 200) year old lifetime. So, it’s important to know what its legal use is- specifically, if there is a question, pay the small fee to get an official zoning certificate. Does its current use fall within what the property is zoned for? If there still any questions here, consult an attorney who specializes in this type of real estate law. It can save you a massive headache down the road. Typically, you may have looked up what the tax assessor says the property is zoned for but don’t let this put your mind at ease as the tax assessor and zoning are not always on the same page! Finally, there is fire code. Fire code doesn’t care what your building should be doing. They care if your building’s fire protection devices covers its actual use. Thus, even if your use is illegal, in the very least make certain it is fire coded as such. This is a huge liability if, god forbid, a fire did do damage. In a nutshell, homework before purchase could save you a lot of potential aggravations down the road.

Housing chatter continues…

Fri, 18 Jun 2021 13:58:59 GMT

Housing chatter continues…

The potential for a housing bubble pop is all over the news. But, what’s going locally? A big 18% increase in sale’s price from May 2020 for one that certainly amps up housing bubble chatter. What is getting far less talk time is inventory. There is none of it! In May, there were only 863 homes for sale in RI- down by 64% in May 2020 and 76% in May 2019. Without supply, prices are not coming down. It’s that simple. And, again, if we go back to the major housing market themes, supply cannot quickly correct itself and demand due to generational shifts is increasing. At the end of the day, the middle class is getting hurt and certainly those who are trying to step up into the middle class as home ownership becomes more and more elusive.

A housing bubble?

Wed, 09 Jun 2021 17:50:47 GMT

A housing bubble?

If you put emotions aside, and with real estate its normally personal so this may be hard, the basics of low supply, low interest rate fundamentally explain why prices have gone up. But, add in emotion, and some volatility is part of the mix. How many buyers enjoy these crazy bidding wars? Frustration is running high and perhaps leading to riskier practices like making offers without inspections or even seeing the house. Again, these buyers are not like the buyers of the great real estate crash- they are much more thoroughly vetted by banks and locally often coming in from out of state where what looks like a high price in RI isn’t elsewhere. So, the likelihood of a real estate correction leading to a market crash is pretty unrealistic. We’ve done away with the days of no doc and exotic arm loans. So, this recent dip in sales- more likely than not a lack of inventory and some buyers simply waiting it out. The spring market is notoriously nutty and this season has been no exception.

Buyer Beware of Below Grade Living Units

Wed, 02 Jun 2021 13:42:41 GMT

Rhode Island is full of historic charm and beautiful old buildings made into multi-unit dwellings. You may be pressed to find a home these days in your price range when all of a sudden you stumble upon this sweet garden walk out. It doesn’t seem like a below grade unit because one full wall is exposed to a brick patio courtesy of the decline in the terrain. But, the other walls… well one is partially exposed but the other two are completely below grade. Stop right there. Old fieldstone foundations are not meant to be next to finished walls. Perhaps, the developer did properly treat them with a moisture barrier but what if they didn’t or what if they used a subpar product? How can you tell? Well, you would actually need to see behind the wall and truly behind all the walls in the below grade section. Completing moisture and mold tests for air quality will help determine if a problem currently exists but can’t predict if a problem will develop. What if the foundation is deteriorating and a few years down the road begins to let water in? Best advice: steer clear of unless you have a warranty from a reputable company that specializes in moisture prevention and can verify that the appropriate work has been completed.

Seemingly never ending adaption with this pandemic…

Wed, 19 May 2021 14:07:55 GMT

The good news is the vaccine at least locally here in RI is terribly effective. The economy is opening up at a much faster pace than we had imagined possible months back. So much change. Some other big changes are also looming: June 30th marks the end of the federal CDC eviction and foreclosure moratorium. That’s soon! For those of us in real estate you may have been tempering swooning over an even hotter spring seller’s market with some anticipation of what may happen after the moratorium ends. Personally, I think many homeowners who experienced hardship also took the steps to qualify for payment forbearance for federally backed loans (up to 18 months) and I just don’t expect to see a wave of foreclosures. Secondly, the moratorium only applied to federally backed loans and we haven’t seen an uptick in other types of foreclosures. Lifting the eviction moratorium will help owners of multi-units, not hurt them. But, the speed of wrapping up this exhausting process is a little blurring. We are now all expected to transition back to work right away and possibly lose unemployment benefits so many are still dependent on if you don’t jump up the process. Hoping transition back to normalcy won’t be too bumpy….

What Goes Down Must Go Up?

Wed, 12 May 2021 13:48:07 GMT

When we are discussing inflation and interest rates this topic deserves some thought. Unless you are living in a cave, chances are you have heard increasing murmurs about inflation: the cost of groceries has gone up, gas, lumber, etc…. Now, how does this relate to real estate asides from the obvious reduction in consumer purchasing power? The Federal Reserve (fed) benchmark interest rate is one of the prime economic tools used to curb inflation. Toady’s inflation report could give you a jar- it’s well above the “healthy” threshold of 2.5%. Thus far, the fed is looking at inflation increases as temporary and as our economy opens up it will naturally re-adjust to a healthier level. Accordingly, reluctance remains strong to increase interest rates perhaps as much for the next two years in order to bolster our post pandemic economy. So, coming back to real estate: maybe buyers will get some relief: interest rates should remain relatively steady while home prices should curtail their dramatic increase as some covid related blockage of inventory loosens. On the flip side, lower and middle classes will feel the impact of inflation most in their pocket books and have less money to save for such a big purchase as a new home.

Section 8 and stuff and other landlord tenant laws in flux

Wed, 05 May 2021 13:53:29 GMT

Every landlord in RI should be aware that as of last month you can no longer disqualify a tenant solely because they have section 8. On a local level, think of section 8 being added to the federal fair housing protected classes. Further, when you screen tenants, your income requirement must include any form of documented income such as child support, food stamps, etc. Our strongest recommendation more than ever is keep it consistent. Our application process here remains unchanged and we apply the same criteria to everyone. Be wary as failure to abide can be viewed as discriminatory and potentially handed over to the Human Rights Commission. Other changes in discussion are requiring mandatory lease extensions with very few exceptions. If you are a landlord pay close attention to what is going in our legislature: the political momentum is to make it more difficult than ever to be a landlord.

Spring Has Sprung!

Wed, 28 Apr 2021 14:30:46 GMT

I cannot stress how important curb appeal is even in this crazy seller’s market. Taking the time to make certain your property has some aesthetic appeal when potential buyer’s first pull up is a critical step in marketing your home. There are quick and easy steps that many of us are capable of accomplishing with some sweat equity. A spring clean-up is one. Mulch is a minor investment along with flowers both of which can really dress up your property. Potential buyers may be more willing to forgive some of your home’s defects if they fall in love with their first impression. Paint is another no brainer. Freshen up your main entrance. Or, if its vinyl power wash. If you want to maximize your sale’s price, planning is key. We love to work with sellers to come up with the best improvements on their budget. This is a basic part of our listing agent’s process.

Rhode Island Landlords much to pay attention to!

Wed, 21 Apr 2021 13:55:51 GMT

First, hopefully everyone is aware of a recent significant change that you cannot refuse rentals based on any type of rental assistance such as section 8. As the rental market has tightened drastically over the last handful of years, it has become even more difficult for a renter with a housing voucher to find a home. On the landlords end, why should we? You are going to lose a month’s rent due to the tedious inspection and paperwork process. Previously, I have turned down such tenants simply because of this. And, I keep providing the same feedback to all our local housing authorities: make your process more efficient and tenants with housing vouchers will have a much easier time. Also, in the works in our local legislature are bills (H 5309, S 0183 & S 0219) aimed at changing the eviction process- making it an odiously longer process. Our current extreme low vacancy climate can afford such changes as rental inventory is non-existent and evictions are few and far between. But, as a landlord myself, I would never want to go through a recession, like our great housing crash, without the protections our current laws provide us. Time to pay attention to what our local law makers are up to.

Whoa, whoa, whoa the spring market is doing that thing AGAIN…

Wed, 14 Apr 2021 13:31:46 GMT

Is this healthy? Should something be done? Personally, I think the current real estate market trends will only further exasperate the division of wealth in this country and erode our middle class. Part of being middle class is owning a home and if home ownership becomes more and more elusive for first time buyers, I can’t see how it wouldn’t aid to the further creation of have and have nots. But, what are the options? The most glaring one is raising rates which would damper appetite and give inventory a chance to catch up. But, real estate has been one of the bright spots in our pandemic economy. Do we really want to rock the boat? Government can embrace programs to create more affordable housing. But, often these publicly sponsored programs come with restrictions. For example, a development has received a subsidy to help offset the purchase price. Buyers must be within a certain income range to be eligible to purchase. Fine. But, than comes a deed restriction they can only sell to others within that income range. That lessens the initial buyer’s potential to capitalize on appreciation. If you are going to do it, just do it. Time for government to think out of the box.

The return to the city

Wed, 07 Apr 2021 15:04:01 GMT

Staying in the world of commercial real estate for a minute, we can try to look ahead for emerging market trends. Back to the work from home model, does it work? Sure, well enough but it’s certainly not deal for younger employees. Think of first or second year employees trying to learn the ropes. Mentoring plays a huge role or even the simple ability to walk over to a co-worker and ask a quick question. This gets back to the synergy of physically working together. While my best guess is we will find some happy medium and allow more work from home time, I think Google’s big move will really set the bar for the return to the physical office aided by our incredible vaccination rates. And, yes, this also matters in the world of residential real estate. These young employees will want to move out of their parent’s suburban homes into the cities that house their work places and, due to the pandemic exodus, they might just find rents they can afford. Let’s keep an eye on this trend as it could lessen some of the strain on suburban real estate and potentially sales and rent prices down the road.

Commercial real estate changed forever?

Wed, 31 Mar 2021 13:49:57 GMT

Commercial real estate changed forever?

There is not one office space using business owner I have spoken to in the last year that isn’t substantially re-thinking their foot print. This work from home thing may be sticking? Today we see the evidence in downtown Providence where “for lease” signs dot the landscape and the WSJ cites that at the end of 2020, office real estate vacancy was up by a whopping 40%. So, we know the pandemic forced us to change our lives but how much of this change will stick? Businesses are mulling over savings in cost versus workplace efficiency with the work from home model. Incredible advances in cloud base technology make this model feasible. Is the old corporate office building dead? Personally, I like the harmony and synthesis from physically working together. I think there is something to be said to being able to walk over to someone’s desk to float an idea. Intangibles like you will know each other more. I wonder how other business owners feel? Regardless, time to brace for some major shifts in commercial real estate if this change sticks from re-vamping office space to the businesses that serve that community.

Real estate is a local market but …

Thu, 25 Mar 2021 13:36:01 GMT

It’s also impacted by national and global trends. We have seen this more than ever during the pandemic. From lumber shortages and price instability skyrocketing the cost of new construction, to lack of mobility amongst current home owners with sellers choosing to stay put, to generational trends like baby boomers not following the traditional path of downsizing at retirement. Sure, it’s local. We all know that. But, buyers also feel national trends with increasingly stringent lending guidelines, a shaky pandemic job market. If you have a keen eye on using your real estate purchase or sale to increase your net worth, paying mind to all these balls in the air will help. Housing costs have gone up. But, right in toe, rents have to. So, that development project that didn’t seem liked it made sense, actually does especially with those great rates. More than ever, think of your real estate investments in terms of local, national and even global trends.

More On Have and Have Nots

Wed, 17 Mar 2021 15:41:06 GMT

An increasing disparity in wealth is a real thing. The US has the greatest income inequality in all G7 Nations and the wealth gap between the richest and poorest families has more than doubled from 1989 to 2016 (PEW Research). From 2007 to 2016, net wealth decreased in lower tiers by 20% while increased in richest tier by 13%. You get the picture. What does this say about real estate? Let’s take it together with some other major trends occurring: baby boomers aren’t moving which further exasperates the other big trend, lack of inventory. Typically, there is a natural progression as people age from a starter home to a family home to finally downsizing when kids have left. But, this just isn’t happening at the same rates as particularly the baby boomers are holding on to their homes longer than ever. So, there is less used, affordable housing stock for say the millennials. Appreciation in real estate is one of America’s great tools to create wealth. But, houses are becoming more difficult to find/ buy and income disparity just seems to grow. What gives?

A K-shaped recovery

Wed, 10 Mar 2021 19:39:15 GMT

Many fear that the economic recovery from both the 2008 financial crisis and current pandemic will lead to an even greater divide between the have and have-nots. K shape recovery describes an uneven or divergent economic recovery where, for instance, the lower or middle class experiences a completely different economic future than say the upper class. In the world of real estate, it’s pretty safe to say we have all taken note of rising prices and an increasingly competitive seller’s market. Who are these buyers? Many are extremely well positioned and able to buy in such a market (in RI we have seen a dramatic increase in out of state buyers). While the have-nots have been staying put. So, is homeownership still an accessible dream for middle class America? If this dynamic continues, it won’t be and lack of inventory from decreased housing mobility (the have nots staying put) will continue to strain already low inventory which in turn will lead to higher prices.

Fear Not

Wed, 03 Mar 2021 19:08:25 GMT

Real estate agents are meant to offer lots of resources. If you are thinking about buying and have a strong stomach, try a fixer upper. Many buyers will be deterred by a project and in the least you will find yourself in a slightly less competitive pool of potential buyers. In this seller’s market, anything counts. However, you also need a good team on your side. Having an agent that is familiar with rehabs and can refer you to reasonable and competent vendors, is an invaluable asset. Couple that with a sound inspector, you are on your way. Both will help you define rehab needs priorities and a budget. Of course, you will also need time, money and the wherewithal to manage the renovations. The 203k loan is a tool buyers can use to finance some rehab costs. It does come with a lot of paperwork so again time becomes a factor. But, if you are willing to invest sweat equity, you can much more rapidly create equity in your new home.

This beautiful old home

Wed, 24 Feb 2021 20:20:40 GMT

Part of Rhode Island charm lies in our historic architecture. We are after one of the original colonies. You may find yourself delighted to look at all these amazing condominiums that allow you to purchase an affordable sliver of a historic home. However, it is equally important to do your due diligence when considering such a home. Many of the associations were condo minimized in the 1980s and, as condos became an increasingly common choice, regulations evolved. For instance, some developers carved out living space in what would be considered the basement. Now, a typical 1800s basement is generally fieldstone, intended to be porous. What happens when you put a finished living space in such a porous environment? Well you want to make certain it was done right and conduct moisture and mold testing as part of your inspection process. Don’t assume the correct steps were taken during the development. We love to work with buyers and have years of experience managing problems exactly like this so we know what to avoid in the buying phase!

Evictions and vacancy rates

Wed, 17 Feb 2021 15:24:39 GMT

Evictions and vacancy rates…

Both have been down- like really, really low by far the lowest I can remember in my twenty years of being a landlord. But, what’s on the horizon? If you are in RI, some pending changes in landlord tenant law that could really hurt. Senate bills 219 and 183 and change the time frame of the eviction process, stretching out what was a fair but concise process considerably longer. Proposed 5 day demands would have to wait for 30 days of non-payment to be sent out instead of 15 and, worst, instead of 5 days to pay it gives the tenant 60 days. Thus, a 90 day delay to file as opposed to what is now 21 days. While I totally support giving tenants a chance especially right now, there are existing safety guards in pace to protect tenants. It is not perfect but this legislation shifts the burden on also a fragile group of first time landlords who have bought multis in the last few years. Now, if these landlords can’t afford their bills, this will create foreclosures and less available rentals for tenants. Anyone trying to find a place to rent will tell you there is nothing out there and certainly nothing out there cheap. Personally, I love to give chances to tenants who may have less than perfect applications but with this new legislation I simply couldn’t afford to. This hurts everyone.

Is this another real estate bubble?

Wed, 10 Feb 2021 14:53:40 GMT

When prices keep increasing, conversation is bound to ponder how much longer sales prices can keep going up. After all what goes up must come down? And, many of us are still shook from the great real estate crash of 2008. Should we expect this bubble to burst? Not necessarily for conditions are much different now. Again, inventory is still limited and it will just take time for housing stock to increase to meet demand. Millennials are growing up and will need houses too. And, these buyers are different. Lending guidelines are stricter now for good reason and these buyers are much more credit worthy. Finally, as the pandemic becomes more and more under control, more jobs will be available too creating an even greater pool of potential buyers. Sum up, the housing market should continue to say strong.

How do you beat a seller’s market?

Wed, 03 Feb 2021 20:24:27 GMT

Well sometimes you don’t. Sometimes your new home is worth more than waiting to find a deal in what has been a hot sellers’ market for years. Also, with continued stability in the housing market, you can hedge your “loss” with some confidence that your purchase will appreciate. Homes are personal and part of what has been driving the single family homes market is personal: desire to have your own door knob, space for a home office, a yard for your kids to work off some of their virtual school day frustrations. While I always push buyers to make their dollar really work for them, there are times when personal considerations become more paramount. What is the toll cramping into a two bedroom apartment is taking on remote work and school life? These are unprecedented times and mental well-being as a result becomes a much bigger part of the calculus for many of us.

Let It Snow

Thu, 28 Jan 2021 22:20:45 GMT

If you are a landlord, keeping a tight bottom line is always on your mind. I should know I’ve been a landlord for twenty years now. Liability should also be on your mind too though as well as knowing the law. And, even if you have the law on your side, some battles are just not worth fighting. I'm talking about snow. Cities require that sidewalks and steps to the mailbox are kept clear. So, it is your responsibility to make certain this happens. But, what about beyond? You can spell it out (and you should) in your leases that rents do not cover snow removal. But, again you do need to come out for the mailman anyway. I’ve found in small rentals, tenants are a lot more likely to have a positive attitude and help if they know you will do some of the work too. In the least always provide salt and shovels. Remember a pissed off tenant will be a lot less sympathetic when filing a slip and fall lawsuit than one you have maintained good ties with.

Transitions

Wed, 20 Jan 2021 16:15:56 GMT

How to prepare for a smooth transition. As our country undergoes a smooth transition of power today, it got me thinking about how much time I spend preparing a listing for sale. The right price and marketing are a huge compelling factor but for many of our clients we are listing properties that may have been rented for quite some time. I often find myself devoting just as much energy into discussing what upgrades can be done to make a property more marketable. Knowing your buyer pool is critical. If you need to quickly unload and are pitching to investors it’s a much different approach than marketing to a more conventional buyer. We have a very wide network of vendors and can facilitate repairs in a concise manner. Pair this with a solid knowledge of what upgrades help make a property sell, we always strive to make a transaction a painless process.

Politics on my mind

Wed, 13 Jan 2021 16:30:42 GMT

Last week’s riots left many of us shook. The visual imagery was so jarring I found myself struggling to comprehend it. In my early twenties, as an intern, I gave tours of the Capitol. As I watched the rioters desecrate sacred places like the hall of statues, I remembered how there was always a hush over the Capitol building as if you could feel the collective weight of our founders and spoke quieter to be reverent. I have a strong love for this country and I know many share my pain to see it so torn. The same love gives me faith that so many of us want less of the bitter divisiveness and more of the constructive debate that makes this country so strong. In all of our glorious imperfections, united we will still stand.

The wait is over!

Wed, 06 Jan 2021 15:28:52 GMT

2020 is in the rearview but we are left with its ugly remnants except in the housing market. All indicators point that we should expect more of the same especially in the first half of 2021. The main factors at play again are low inventory and historically low rates, continuing a strong seller’s market trend. Of course, Covid has the potential to wreak havoc still with the economy which could greatly curb buying potential and blunt the seller’s market. However, with a new administration in place and the balance of the senate literally up in the air, more massive spending bills are likely and would prop the economy up. But, of course, just when we thought we had a solid Covid game plan, new variants throw a monkey wrench in and pit us in a race for time to vaccinate enough before the more contagious strands spread exponentially. In a nutshell, buyers should expect finding a home to be competitive still whereas sellers should benefit from real estate market trends but shouldn’t dally to list their home.

Welcome 2021!

Wed, 30 Dec 2020 16:17:18 GMT

2020 has brought many of us to our knees and taken some from us as well. But, yet the human spirit is so strong, we adapt and will overcome. In a year that has brought an abyss of sorrow and stress has also brought modern miracles in multiple vaccines created in never dreamed of amounts time. We have learned that our ability to be flexible has learned completely new boundaries and however imperfectly our businesses have carried on, our kids have been educated, our medical personnel have learned how to function in a pandemic and our country still stands strong. When days seem particularly dark, I fall back on a strong sense of faith that we will tame this insidious virus and return to some sort of normal. And when we do, I’m confident we will all appreciate the simple luxury of giving someone a hug who needs one without any apprehension. Big thank you to our clients and customers for enabling us to continue our business into 2021 as well as to all our tenants who struggled through this trying year but have somehow made it happen.

Happy Holidays

Thu, 24 Dec 2020 18:03:58 GMT

Happy Holidays

Merriest wishes for the holidays. A big thank you to our clients and customers for allowing us another year of business. And, to our tenants who have all figured out a way to pay rent. Blessings!

The vaccine has hit our arms!

Tue, 15 Dec 2020 15:51:10 GMT

It’s like having boots on the ground! And, we have something that has been totally lacking: some predictability. We know for average joes like me, the vaccine will be available in March or April with a projected “herd immunity” by the fall. And, thus, we can plan and also began to assess the economic destruction of the pandemic. Of course, the other missing piece of this puzzle is the next economic stimulus package which will determine how many businesses are going to slog through this. So the process is moving at lighting speed for the vaccine but slow for all of us suffering. But for real estate? I think the 2020 trends will continue maybe in a slightly less aggressive fashion. The pandemic does slow things down and one of the biggest factors driving the 2020 market is low inventory and low rates. Supply simply could not keep up with demand. I don’t see this changing much in 2021 but I do think the market will become more balanced with less drastic price increases. The commercial real estate market is a totally different story and will be impacted negatively by struggling and failing businesses. Thus, for all of us in the real estate world, we can plan our next moves.

Winter frame of mind?

Wed, 09 Dec 2020 14:53:17 GMT

Within a week, we had two substantial wind and rain storms. Saturday’s deluge let go nearly 2 inches of unrelenting rain and the Monday before last we were beat with 50 mph winds. Any roofs that had vulnerabilities had ample chance to fail. On our end, we struggled with a particular rubber roof that has been problematic. Installed before our management, it overlays the older asphalt roof. The building it sits on is taller than its neighbors and the front gets a lot of unbuffered weather. When leaks occur, instead of passing into the top floor unit where they are visible, they spread and saturate the rubber roof’s insulation board as the older asphalt roof provides an unfortunate barrier between the rubber roof and unit below. By the time a leak is discovered, much of the insulation board is wet and the cost to repair is high. We have already kept this building on a once a year roof maintenance schedule but as problems continue, we advised it will ultimately be less expensive to inspect more often. If we can nip the problem before the water takes its destructive course, we can minimize the amount of roof that will need replacement. Thus, depending on the location of the property and its exposure to weather, complicating factors like remaining underlying roofs, should determine how often preventative checks are completed.

Tenants Struggling What To Do?

Wed, 02 Dec 2020 19:23:32 GMT

Our best advice is to know your options. Whether it is the safe harbor program or rental assistance through Rhode Island Housing’s Home Investments Partnership Program, knowing what resources are available is key. No one wants to evict right now. The winter ahead promises to be as bleak as they get even with a vaccine on the horizon. Staying up to date with what resources are available is a job in itself as programs get funded and quickly run out of money. Safe Harbor has been the steadiest source of rental assistance but the wait for assistance is long. Encourage tenants to seek help from their local place of worship or Salvation Army or even set up a go fund me page. If you chose to evict, beware. It is not so simple anymore. And, wait times for court dates are ridiculously long. No more two week turn around, we are almost two months out. All signs point back to negotiating with your tenant. If they are unresponsive, put on your mask and knock on their door. I often find this simple step to be the most effective in sparking a dialogue.

Rough Patches Ahead

Tue, 24 Nov 2020 15:00:47 GMT

You can’t turn on any type of media without ignoring the Covid headlines. RI has stumbled with cases soaring and hospitals nearing capacity. We all need to listen better, myself included. After just ending a week’s isolation with my three little boys while trying to juggle running a small business, within days I find myself “a contact of a contact.” Indeed, my pediatrician’s parting words with me last week when she cleared my son, was” we pretty much all just need to assume we are a contact of a contact at this point.” And, if you find yourself in that esteemed position, you technically don’t need to quarantine but you should step it up several levels of diligence. And, contact tracing is completely dead. You have to do it yourself and the quicker the better. I’ve found if you know you may have been exposed, you are more likely to give better consideration to safety measures. I still haven’t received a contact tracing phone call from DOH from my son’s possible exposure two weeks ago. When my oldest son looks at me with those big brown eyes and says “Mommy I’m tired of the big cold,” my heart breaks a little (because I am too) and goes out to all of our frontline workers and our doctors and nurses who are our last line. As one doctor aptly just said, we are your last line to keep you from dying and we need every American to step up to be our frontline. In other words, wear your mask please.

Big news of the week?!

Mon, 16 Nov 2020 21:35:34 GMT

By far better than expected vaccine efficacy rates with Moderna at 95 percent and Pfizer/ Bio N Tech at 90 percent effectiveness. Right now much of the real estate market as well as our economy hinges on pandemic management which is why it's so important to stay tuned. So, it seems like a third of the battle has been met with vaccine final approval and distribution still to come. And, so, our crystal ball becomes a little clearer although I still think the outlook is murky at best. There is a light at the end of the covid tunnel but the damage done and to come to get there needs to be quantified. I wouldn't expect much short term change in the real estate market but my concern is more long term and how long it will take to look covid in the rearview and how much of an economic hole we need to dig out of.

2021: Boom or bust real estate market?

Tue, 10 Nov 2020 19:00:22 GMT

Maybe neither. The trends that have driven the seller’s market in 2020 do not show much evidence they will change course: low interest rates and low inventory. Of course, real estate is local and cities may suffer more as the Covid work from home suburban exodus continues. However, interest rates are unlikely to change substantially and inventory would take time to rebuild so these two factors alone should keep the real estate market afloat. What could effect it adversely? The job market and our ability to negotiate the next stimulus package will play a huge role in keeping the real estate market hot and, of course, the vaccine timetable. In September, 7% of all mortgages were in a mortgage forbearance program. If the foreclosure moratorium is lifted now those foreclosures would start hitting the market next summer. Thus, our country’s ability to prevent a wave of foreclosures and provide support to families who cannot work during the pandemic is critical. Stay tuned, look for deals this winter and pay attention to these factors to forecast whether or not 2021 will bring better deals.

Post-Election Real Estate

Wed, 04 Nov 2020 15:57:18 GMT

Jeez we all are still holding our collective breath. What impact will the election have? Biden will bring some calm and better planning to manage the pandemic which will help steady the economy during the bleak months to come. But, the market loves the heady world of Trump and he lights a bit of fire under the economy. In either case, a lot of this comes down to how long a vaccine will take to reach Americans and what is done in the meanwhile to support our economy and manage the public health crisis. The president alone cannot control this. The vaccine is in the hands of scientists working around the clock. In a nutshell, look to science and pandemic management to predict economic stability. This is turn will drive the short-term real estate market: Coronavirus will continue to drive the single-family homes market but lack of another stimulus package and/ or Covid spiraling out of control will damper sales. Buyers should be on the lookout in the latter.

Riding the Fall Covid Wave

Wed, 28 Oct 2020 15:28:13 GMT

Why should the dreaded fall and winter waves be different? Have some faith, we know so much more now about Covid. Remember how scary it seemed last March when we were struggling to understand the virus? I don’t mean to be casual that we know everything about the virus now; obviously, long term effects and a vaccine have much to be determined yet. Still, we have learned how to live in some semblance of normalcy and we know how to cut back and be more careful if we start to get a local peak. Now, more than ever evaluate your actions in the context of how it impacts your community. We all have to sacrifice. Try to think of your individual sacrifice in terms of how it keeps your kids or your sister’s kids or your friend’s kids in school or your local coffee shop open or your favorite restaurant in business. Real estate has proved to be very resilient to staying open during Covid. Agents quickly became extremely adept at navigating entire transactions virtually. I have no doubt we will only improve upon this. My concern is for the myriad businesses who rely more on personal touch. Be safe!

Evicting in a pandemic.

Wed, 21 Oct 2020 14:32:26 GMT

Well evictions are never pretty but now it’s hard to ignore the social implications of displacing people and families. And, right now, you actually can’t if the eviction is for failure of payment due to the CDC eviction moratorium until the end of the year. So, what can you do if your tenant is behind in the rent? Keep communication lines open. Even if you find your tenant not the easiest to have a causal conversation with, now is the time to work on communicating. Casually ask how work is going, know what industry they are in. The months ahead will simply be tough. Having rapport and keeping a step ahead with your tenant will only benefit both of you. Know resources. Right now Safe Harbor Program is the first place to start. But, local resources like churches, salvation army, cross roads, community action programs may also offer help. Finally, show some empathy. Times are tough right now. A little compassion can go a long way.

Calling all buyers.

Sat, 17 Oct 2020 14:22:31 GMT

You know what has been happening more lately? Price drops! I am expecting this trend to continue through the winter and its magnitude is largely dependent on Covid management and national and global stability. Right now, with an upcoming contentious election and Covid cases on the rise and in the least way too high for entering flu season, we are in for some turbulence. If you are a buyer, now is the time to get your ducks in a row. Save money, maintain your credit and check in regularly with your lender for changes in lending guidelines. With increased instability, expect more rigorous requirements to lend. However, if you are a solid buyer, this will make you more competitive to find a deal in a market that may soften. Finally, remember supply is always part of the equation and Covid instability will reduce supply as occupied properties will become less available to market. A lot of flux ahead, stay tuned and be safe!

Keeping an eye on trends

Wed, 07 Oct 2020 18:13:15 GMT

Your single biggest chance to capitalize on any real estate purchase is by staying ahead of the market. You don’t need to be a big time real estate investor to strategize. I have many friends who started on this path decades ago with their first single family home purchase. Times are a little mind boggling- there is simply a lot going on right now. But, what are the big trends? Interest rates. They are LOW but this can’t last forever. Any increase will soften the seller’s market. Inventory. Due to the pandemic, the desire to have your own doorknob and more comfortable work from home space is driving the single family home market to new heights. This also will not last forever. Foreclosures and evictions. Expect more buyers to default as the economy stays shook. Expect this trend to be exasperated by multifamily owner’s inability to evict. Put it all together, keep an eye on the multifamily market in the next year for price drops. If you chose to invest, keep some cash aside for non-paying tenants.

Fall into fall

Wed, 30 Sep 2020 15:40:50 GMT

Winter should not bring maintenance surprises. Now, is the time to do preventative maintenance on heating systems and roof checks. Don’t leave it until last minute. If you find out about a roof repair in December, you will just be rushing to get it done before the frigid winter months and possibly stuck with a subpar vendor. Allowing more ample time will enable a more competitive bidding process. We make it our goal to have any common heating systems inspected by mid-September as well as any flat roofs past a five year age range. Gutters should always be leaned after leaves fall. And, any sprinkler systems should be winterized.

Some like it hot!

Wed, 23 Sep 2020 14:57:38 GMT

Certainly sellers appreciate the sizzling hot market. More than ever it’s important to view our local RI market in terms of state-wide, regional, national and global trends. Within RI, we continue to do an admirable job mitigating the pandemic. There is loss sadly of both lives and businesses but compared to other states, our positivity rating hovering in between 1 and 2 % is a success. Regionally, this summer has seen an uptick in out of state buyers with double digit increases in both buyers from MA and NY. These out of state buyers may be more seasoned with aggressive seller’s markets which may have bucked the trend of bidding wars, escalators clauses, waiving of inspections, etc. Nationally, if you so much as glimpse the news no matter what side of the aisle you stand on, it’s topsy-turvy. Many states are not in good shape to weather the flu season amidst a pandemic. This winter forebodes bad news nationally. Globally, I think we are all holding our breath to see how the economy will weather this pandemic which is greatly dependent on the timing and effectiveness of a vaccine. Stay tuned to make informed decisions to buy and sell.

Buyers! Is your time coming?

Tue, 15 Sep 2020 19:33:07 GMT

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It’s pretty straightforward that we are in a seller’s market. The pandemic exacerbated an already low inventory which combined with historically low interest rates has led to bidding frenzies. What can we expect is in store for us for the rest of the year and in 2021? Well, inventory has loosened up as Covid restrictions have also loosened up but still needs more time to build up supply; there will still be a chunk of sellers who chose not to sell simply because they don’t want strangers tramping through their home (new listings are still 22% below last year’s level {Redfin}). What else? Realtor.com is predicting an even greater winter slump than normal. How great will really depend on coronavirus this winter. And, in addition, the failure of Congress to extend any type of pandemic insurance lessens the middle class buying power. So, buyers, as much as we would like to see smooth sailing through a covid winter, any upside of a worsening pandemic would be a more buyer friendly real estate market. As always, our prayers are for a vaccine soon and as few casualties as possible.

The stock market is not the economy

Wed, 09 Sep 2020 20:06:08 GMT

Americans struggling without pandemic unemployment, reports from Yelp at only halfway through the summer 80,000 small businesses have permanently closed their doors but the stock market has been so bullish. Well, except for recently as it seems September is bringing a bit of a correction so far at least. More troubling the volatility rates also increased which can sometimes indicate an even bigger correction is on the way. So, when most of us have been struggling why have stocks been having so much fun? There are always a few things at play: the dollar is cheap (40% of our largest companies revenue come from overseas), federal money is free flowing, and big companies can really leverage their position as smaller companies fold. So, the covid economy has bolstered many big companies whose stock sell on the exchange while small businesses have shouldered the weight of the covid economic shut down and staggered re-opening. Why does this formula seem ripe to foster an even greater division of the social classes- with the wealthier getting richer and the poorer poorer? What does this have to do with real estate? Watch out for the impact on the middle class who account for a sizable chunk of home owners/ buyers/ sellers and are more likely going to feel the covid squeeze than the wealthy.

Escalator What?

Tue, 01 Sep 2020 20:27:14 GMT

The covid single family home market! If you are trying to buy a house right now, put on your seat belt, be prepared to lose a few rounds, brace for bidding wars that can go 20% over asking and educate yourself on the escalation clause. I have to say it isn’t pretty. New listings are often so flooded with prospective buyers that, if you don’t call right away, you aren’t even going to get in to see it. But, what about this escalation clause or escalator? If it works properly, it is a great tool to give buyers leverage to maximize their bidding strategy. Say, you fall in love with a house priced at $350,000. You have already lost out a couple times in bidding wars that went over asking and you are prepared to put in an over asking offer of $360,000 but you love, love, love this house so much you would pay up to $375,000. Your offer can be submitted with an escalator clause: your offer is $360,000 but your maximum offer would be up to $375,000 if other buyers offer more than your $360,000. Generally, another buyer’s offer of $365,000 would prompt your offer up in $5,000 increments to $370,000, a process that caps out at your specified maximum- in this case $375,000. In this market, buyers may need this extra aggressive step to get into the door.

What’s new this week?

Wed, 19 Aug 2020 14:52:22 GMT

Saliva tests and some possible good news about covid immunity. If you haven’t had the pleasure of getting a covid test yourself yet, I’m sure at this point you have heard stories from others. Even in our testing forward state, until recently the turnaround time has been 3-5 days. I just recently booked tests for myself and hubby at the Convention Center which are supposed to render results within two days but I had to schedule 5 days ahead. It’s no surprise there is a lot of hype around Yale’s saliva tests expected to be available in the coming month. Not only are they less invasive, they are cheap, and quick! Further, evidence is gathering that the immunity response to covid is robust which indicates possibility of longer-term immunity to the virus. What does this have to do about real estate? Our nation’s ability to stem this pandemic and operate during it, go hand in hand with the economy both short and long term. Thus, when buying and selling all of this matters. So much to think about!

Does it seem counter intuitive that the stock market continues to rally in the midst of a poorly handled pandemic in the US?

Wed, 12 Aug 2020 19:08:57 GMT

“Stocks are not the economy, but they are not not the economy either (Business Insider).” What does that mean? Do you wonder why stocks rise as your hear more tales of small businesses having to shut their doors? With real estate, taking both a short and long term view is important and having some sense of what the economy is doing matters as this all plays into how your property will appreciate. But, GDP of some of the hardest hit industries like restaurants, recreation related businesses and hotels actually only make up 5% our total GDP. And, larger companies that sell abroad are actually raking it in on a weak dollar buoyed by Europe’s more adept pandemic management. We have done a good job quickly getting economic relief to millions of Americans and businesses but this needs to continue in order to sustain our market rally as the average consumer’s spending does have a greater impact on our economic health. So, in a nutshell, even with our muddled efforts at pandemic management, it really isn’t looking too bad for the real estate market as long as financial support continues from the government.

East-side Condo Coming Soon!

Thu, 06 Aug 2020 20:34:51 GMT

We’ve got some off the market East-side condos! Call us for details.

Coming up soon 303 Angell Street #2. A really special 2 bed, 2.5 bath, 1250 sf, 1st floor condo blocks from the heart of Wayland Square. We are getting a little facelift now but expect to see us in all our glory on mls shortly. Feel free to contact us for an “in the facelift” process showing now! $429,000.

Tenants, tenants, tenants and the last week of pandemic unemployment for now.

Tue, 28 Jul 2020 19:25:03 GMT

Next week many of us will feel the crunch as we lapse for some period of time without the pandemic unemployment and try to reconfigure budgets with whatever the new amount may be whenever it may come. If you are a landlord, plan now. You should already have an idea whether or not your tenants have been depending on the pandemic unemployment and now is actually a good time to reach out to them to find out if they expect difficulty paying their rent. Gina is ahead of us as usual with her $7 million funded United Way Safe Harbor rental assistance program for tenants in need that qualify. Landlords you can apply for your tenants. We can finally move forward with evictions unless your tenant is section 8 or you have a FHA backed mortgage. The golden rule is if tenants get more than one month behind in their rent, their likelihood of getting caught up greatly declines. However, we have had to personally help tenants who didn’t have access to internet with unemployment claims (try getting through to unemployment on the phone). Of course, there is tremendous benefit from knowing local resources that may provide assistance to tenants in danger of eviction. If you can avoid evictions, now is the time more than ever.

Some things are steady

Tue, 21 Jul 2020 19:02:14 GMT

Right now that’s the real estate market. Trends are maintaining: volume is down but improving month over month and inventory is low but prices are slightly up. I know I tend to be dour about economic outlook but I think the lack of inventory has been a godsend to appreciate sale’s value. Maintaining property values in the midst of this pandemic where life seems turned on its head has got to be a good source of consumer confidence which of course in turn drives the larger economic markets. And, I just don’t see it changing. We have learned how to be safe and very virtual so it is feasible to sell. But, I don’t see the market being flooded any time soon with I think most taking the conservative route not to sell if at all possible. So, if you do need to sell, expect some appreciation. I feel more optimistic about buying too with solid vaccine hopes in the near horizon especially if a new stimulus package is unveiled that for instance extends or replaces the pandemic unemployment so many families are propped up on. Once again, I want to take time to praise our local leadership- Governor Raimondo and her team- for making sound, educated decisions how to navigate the pandemic. Little Rhody leading the way how to successfully re-open!

Ups and downs….

Thu, 16 Jul 2020 14:08:51 GMT

The exciting news this week is one Covid vaccine trial is smashing it. Stocks are excited. RI is still a model of Covid stability. The housing market is strong. On the flip side, 1.3 million jobless claims were added within the last week, a figure that is double the worst ever pre-Covid week. Now, the new number of claims is pretty much what was expected and there is some uptick in new hiring. So, why are some of our biggest banks setting aside billions of dollars? Well, some think the worst of the economic damage is yet to come. How many people are being supported right now by the pandemic unemployment? I know a few. What will happen when it is set to expire end of this month? Banks are betting on losses and chunks of mortgages that will become toxic compounded by really low interest rates that will not generate a lot of new loan income. The expectation is that banks are gearing for double digit unemployment through the next half of 2021. Globally what’s going on? Well, China is officially not in a recession and its economic comeback as the world’s second largest economy seems promising. Of course, they only recorded one new Covid case nationally yesterday versus our 66,000. Just saying let’s hope for this vaccine.

Covid is Tough Going Even in RI

Wed, 08 Jul 2020 19:20:00 GMT

I was on the phone today with one of our small businesses commercial tenants and, if it wasn't for a break in their rent, they admitted they would have had to close their doors already. As a small business owner, this breaks my heart. And in the same breath, I am so proud of the job we have done in RI. Speaking personally, never in my life have loans to access emergency capital been so easy. EIDL and PPP were painless, quick processes. But, what about the businesses who face long term loss of businesses: wedding and tourist industry related business, bars, and restaurants with limited outdoor seating? What does this have to do with real estate? The market is hot right now buoyed by demand over what is still reduced inventory. I am wondering more about long term ramifications. On the micro level, I think it is easy to intuitively grasp that more and more small businesses closing is not healthy for our economy. And, what does our economy look like with a chunk of businesses not able to safely operate in the Covid world? So much of this comes down to the timing of a vaccine and its effectiveness. If you want to sell, do it now. And, if you want to buy, maybe wait a bit more.

Not A Good Feeling...

Tue, 30 Jun 2020 14:25:05 GMT

Anyone else’s upbeat feelings on how well RI’s re-opening is going tempered by the rest of the country? I’m sure I’m not alone here. Again, what can we make of all of this? The national news is pretty dreary. What will a few months forward look like? Higher death tolls? More state’s having to pause re-openings and/ or beginning that really slow (if done correctly) re-opening process? I think it would be foolish to think this won’t have a drag on the economy. So, how exactly does intermittent national failure to re-open successfully temper the Rhode Island economy? Frankly, we are used to being at the bottom of the heap in terms of strong economies. We find ourselves in a refreshingly surprising position of leadership instead. Could this mean more good things for Rhody? I kinda think so but at the same time I remain very concerned over the drag the national economy could have here locally. I know more questions than answers today.

What is the deal?

Tue, 23 Jun 2020 19:31:38 GMT

What is the deal? So, we can relax a little bit in RI after all of our collective hard work in March, April and May. With wonderfully declining local Covid rates, we can breathe more easily albeit masked up. The real estate market is still much the same. Sale's prices have held their increase, bolstered by very low inventory. As regulations continue to relax, we should see more listings hit the market and maybe a little more "natural view" of the market itself. But, what can we expect long term as that is more sensitive to national and global trends? Well, if the good news of 2020 is a vaccine for Covid, the stock market at least is hedging their bets on the resiliency of our economy to rebound. If not a bit of a mess with national rising Covid cases likely to create a real drag on consumer confidence. We are very fortunate with sound local leadership. The proof is in the pudding. A quick glance at our Covid cases graph paints a pretty picture. Is it enough to be able to count on local predictability but not national? For the local residential real estate market, I think so at least for the rest of 2020. Commercial is a different story as investors wait for deals and businesses are more reluctant to make moves. The future of the residential market will greatly hinge on the timing of a vaccine, the impact or severity of peaks and/ or second waves and our national response. My prayers are with always our first responders and everyone committed to finding a vaccine or treating this insidious virus.

What makes for a smooth sale?

Wed, 17 Jun 2020 14:06:28 GMT

A good team! When we work for you, decades of experience will help guide you through the selling process. Many of our clients we assist with sales have already been long-term clients where we have rented and managed say a condo for them for years. Once we know one of our clients is considering a sale, we will come up with a list of recommended updates and work with our clients to figure out how to get the best stretch of their dollar. Everyone has a budget and buyers really like to see certain updates. We work within that parameter. With development and property management experience on our side, we already have great connections with affordable, reliable and timely vendors. Our clients get more for their money which results in greater resale value. It’s a win win. We will also tailor our market analysis to give a better sense of how much a certain update will impact sale’s value. That way our clients can really evaluate if a new bathroom makes sense or not. Work with us, win with us!

So, what about the economy?

Mon, 08 Jun 2020 19:33:02 GMT

Overall, I think it is safe to have some level of confidence in the ingenuity of Americans and our ability to adapt. Obviously, the recent unemployment data created a nice lift even with the confusion of an overly aggressive unemployment rate. A recent Bloomberg article sums it up well from my perspective: “The data show a U.S. economy pulling back from the brink as states relax restrictions and businesses bring back staff amid record government stimulus, including loans that were contingent on rehiring workers. At the same time, the lack of an effective treatment for Covid-19 -- which has already killed more than 100,000 in the U.S. -- means infections may persist and possibly surge in a second wave, with the potential to further shake the labor market and extend the economic weakness.” In other words, proceed with caution. So far, we are navigating re-opening without any major pitfalls but this is very much a process and one we still need to wait to see the final play. What does this have to do with real estate? People need jobs to buy and the labor forecast goes hand and hand with a robust market. The real estate market’s strength is directly related to consumer confidence and right now we still have to wait it out a bit to see how all this re-opening shakes out. Stay tuned- 2020 may feel like you have already ran a marathon but there’s some distance left yet.

I am White

Tue, 02 Jun 2020 19:56:05 GMT

I am white. I cannot know what racism feels like. I am a white woman. I do know what sexism feels like and when I am a victim of sexism it causes me anger but I deal with it and also don't have to worry about my life being taken. I am a white woman business owner and it causes me pain to watch mom and pop stores being destroyed after we are all limping from a pandemic but it causes me much more pain to watch a modern day lynching of yet another black man. We are all products of our culture, upbringing, education, etc and whatever way it has molded our perception on race. We are human and gloriously imperfect. But, systemic racism is wrong. It is un-American to continually demoralize a segment of our population like their lives do not matter.

Phase 2 Coming!

Wed, 27 May 2020 13:45:25 GMT

Next week will begin with many more businesses being able to finally open their doors. As a state we have succeeded in moving though Phase 1 without any spikes in new cases or overwhelmed hospitals. I know I have been watching for any signs and after a few weeks, the good Governor is right: the data would have shown by now if we had faltered. What does this mean? We can have some trust in our local governance that their understanding of this insidious virus is thorough and consequently they can promote realistic expectations for our state. Small businesses can than in turn plan better and figure out how they can succeed with a new model and most likely a new bottom line. And, we can start to plan ahead for the next possible wave next fall and winter so we are better prepared. Getting ahead is the key. I want to thank our leadership here in Rhode Island for paying so much attention to all the details and making this state still tick in a pandemic. Hopefully, never again will we have to go through this and I will take some faith in the Governor’s words that we got to come out of this stronger together. Some days you can really just feel the collective pain this pandemic has caused from lost lives to failed businesses to mental trauma. But, I have to choose to have some faith that having hope is a better course than despair. Rhode Island Strong!

Housing Market Again

Wed, 20 May 2020 15:18:44 GMT

Federal Reserve Chairman Powell admitted yesterday that there are some weak spots in the housing market. The mortgage forbearance program is an example which allows federally backed mortgagees to delay or reduce their mortgage payments for up to a year. However, as the forbearance rate creeps up to almost 6%, the pressure of non-payments may be too much for non-bank servicers. Ultimately, this trend could make it more difficult for new buyers to obtain financing as lending guidelines have already become tighter or some lenders become too upside down to stay afloat thus reducing the pool of lenders available. On the other hand, forbearance has been clarified as a plausible option with Fannie and Freddie backed mortgages offering options varying anywhere from an actual loan modification to a longer re-payment schedule as opposed to a lump sum payment due all at once at the end of the forbearance period. Of course, a lot of this comes down to will your job be there for you as the economy re-opens and can you eventually resume your mortgage payments? I think we simply still cannot predict the extent of the financial fallout as it is just too soon to gauge how many small businesses will fail in the process of re-opening. For instance, how many restaurants can operate at 50% capacity? We will have to assume these measures will be in place for a year and in the winter most climates will not allow for outdoor dining. What does this have to do with real estate? If the average middle class consumer begins to stumble through a small business failure or lack of job to go back to all markets become much more reactive to each other. Food for thought. For right now we can still enjoy a stable real estate market buoyed by low inventory.

https://www.cnn.com/2020/04/20/success/mortgage-forbearance-coronavirus/index.html

https://www.forbes.com/sites/taramastroeni/2020/05/18/new-study-explores-how-coronavirus-has-impacted-buyers-in-the-real-estate-market/#2993e242119b

Analyzing the spring market?

Wed, 13 May 2020 15:42:29 GMT

In a nutshell, it’s not that bad considering we are in the middle (or a beginning depending) of a pandemic. The major forces of supply and demand have been tightly dictated by a national reduction of 15% inventory from last year’s supply. Sellers are simply waiting to sell for many reasons but foremost is safety if they still occupy the home. Low inventory protected sale’s prices which nationally increased .6% from last year. Albeit less than the prior year’s sale’s price increase of 3.8%, this is still really good news that the real estate market is holding steady along with the stock market. Locally, for once, the news is even rosier. Rhode Island’s first quarter sales have been buoyant. The beginning of the year began at a really good pace and carried through into March. With a lot of adaptive problem solving, closings have still been happening virtually with lenders and closing attorneys showing some flexibility for items like smoke certificates. Don’t you wish we could always work together in such a productive manner? Indeed, SFH’s closing volume increased by 8.3% from last year’s period and the sale’s price went up even more- 13.7%. Multi-families and condos followed suit although with a little less invigoration. In a way this surprisingly strong real estate market sums up some of my own optimism for our future: you have got to have faith in human ingenuity and spirit and believe we will still find ways to prosper.

Are you ready to re-open?

Thu, 07 May 2020 14:59:24 GMT

If your business model has been functioning even at a breakeven level that’s a blessing. Rhode Island’s re-opening will not give immediate tremendous economic relief. Now, is the time to re-think how your business can function for the next year at a minimum contact level. From staggered work schedules, to maintaining some level of working from home, we all need to think out of the box and embrace as much online activity as we can. I would love some type of Shop RI website where we could browse local RI businesses for our needs (instead of amazon). Something akin to what Etsy does for craftspeople. Like it or not, this will most likely be our reality for the next year at least. Please continue to be safe. We are all in this together. Once again thank you to all our frontline workers from our nurses to postal employees to grocery store cashiers.

Two weeks???

Tue, 28 Apr 2020 14:47:14 GMT

Our good Governor announced yesterday that RI is on track to begin a phased re-opening of the economy in two weeks. Of course, this all depends on new Covid cases remaining steady or declining and hospital capacity maintaining a manageable level. So, are you ready? For businesses we all have to operate on a new normal. Best to get ahead of the curve on this as this will be the way of life for a solid year. Plan for spikes in Covid cases later this year that may necessitate a controlled roll back of the economy’s re-opening. How is your business model functioning (if at all) now? Can it weather more economic pull backs, a recession, possibly a depression? Emotionally how will it feel? Will you be prone to relief, anxiety, happiness, hope, confusion, grief? Now will be the time to respect we all have experienced the same pandemic but with very different realities. Be sensitive to those who have served in the front lines as this experience may have been simply traumatic. Some will be actively grieving those they lost. Others will be angry that this was all some fabricated political hoax that cost our economy substantial losses. We all have lost in one way or another. Everyone’s normal is being re-calibrated. For those of us who still have our loved ones, who have been able to financially scramble by, be generous to others who haven’t. This year will take a lot of patience and kindness and resourcefulness. We are all in this together.

Buying in the pandemic… what additional factors should you take into account?

Wed, 22 Apr 2020 14:59:07 GMT

If 2020 is the year for you to buy, what can you expect? For starters, some increased volatility with both the lending market’s fluidity and regulations as well as sales prices. First, increased uncertainty leads directly to higher interest rates or at least greater volatility of rates- meaning they may swing by fraction of percentage points even within a day. This in itself probably isn’t the end of the world as rates are still historically low- I mean they are basically swinging from really low to really, really low. Probably best to pay attention to changing lending requirements. You may need a higher credit score, larger down payment, have to pay points and may need to go to more than one lender to find the right options. As far as sale’s prices, are you going to find that deal? Maybe, maybe not. Remember the real estate market is notoriously slow moving as in it reacts to economic changes in almost a delayed manner than say the stock market. Of course, you may find a seller that has to sell and frankly it is more difficult to sell right now. So, those type of transactions would be in the buyer’s favor. Of course, sellers that can are more likely to pull their listings from the market, leading to lower inventory. Finally, keep in mind how this economic instability impacts you as the buyer directly. Before purchasing and taking on the financial responsibility of a mortgage, you would want to feel really confident in your own job security.

Where will this historic unemployment and massive bailout lead us to?

Wed, 15 Apr 2020 18:29:35 GMT

Since I’m not an economist, I can best answer this question by looking at the micro level. Just consider realistically when our local Rhode Island economy opens back up, how many small businesses will be there to open with it? How many have closed permanently? Or, probably most likely, will open with reduced labor force and may or may not be able to swing their regular expenses while operating at reduced output. I’m sure the numbers could be crunched now as to what the economy will look like if it could re-open at full speed in two months but after four months of losses and a 2 trillion dollar bailout. Just think of it again on a micro level. Your business has lost money for a quarter and you have taken on 3 times as much debt as you were previously carrying. I mean that sounds tough to me. Now factor in that it’s really unlikely the economy can ramp right back up and unemployment will plague us as employees find their old jobs gone when they can go back to work. Hmmmm does this spell a recession? Or, should we prepare now for a depression.

https://www.cnet.com/personal-finance/are-we-in-a-recession-or-economic-depression-and-whats-the-difference-anyway/

https://www.nytimes.com/2020/04/03/upshot/coronavirus-jobless-rate-great-depression.html

Property management in the pandemic.

Wed, 08 Apr 2020 14:52:22 GMT

Property management in the pandemic.

Has managing a rental property just become a little more difficult? You are not alone. Here’s some suggestions. Some rent is better than none. Right now evictions are not being heard in court so there is no real strong arm to force tenants to pay or move. If your tenant can’t pay because they are out of work and waiting on unemployment, that is a very legitimate excuse and you should listen with open ears. Of course, you can ask for some type of proof but be a little understanding the unemployment system is processing many claims and there will be delays. Can they give you a partial payment? That helps you a little and tenants are less likely to bounce if they pay some rent as opposed to not at all. All other considerations taken away, it is less worthwhile to lose your apartment over a half a month’s rent than a whole month’s rent. Watch your communication style. With everyone feeling the stress, coming off as narrow minded and just concerned with your bottom line could back fire. Personally, with tenants that have a past history of unreliable payments, I like to let them talk first and just listen for clues if they are being honest or not. Again, it is in everyone’s best interest if a payment plan can be worked out. Finally, with any commercial tenants, I would recommend giving a temporary rent reduction some serious thought. Yes, assistance has arrived for all us small business owners but it simply will not be enough for some. Use your judgement- it’s the same logic. Giving your commercial tenant a half month rent discount for the next two months may provide enough motivation for them to tough it out. Evaluate that measure against the thought of having to re-rent your commercial space right now. We are always here to help with your property management needs!

Pandemic aftermath

Mon, 06 Apr 2020 23:03:05 GMT

It's difficult for the most skilled and educated minds to really gauge how the pandemic will play out on the economy. A lot of this falls on how long it will take our great country to tighten its handle on the spread of the pandemic. And so much of that depends on the minute, individual actions of each and every one of us.

We are completely dependent on each other. So, what does that mean on the micro level? Well, you should be more than ever focused on your budget. If you own rental properties, start to brace for loss of rents and slower turnover between rentals. Right now, you can't even enforce an eviction. No one wants to be moving now. And, for safe practices, it is really a liability to show a unit while your current tenant still lives there. Which means you should wait for them to move out first. All of this translates to reduced cash flow. There are resources if you are already struggling to meet your mortgage payment:

https://www.rihousing.com/homeowner-assistance/ .

And, as always we are here to meet your property management needs, even for just a question.

Be safe, sanitize and be kind!

Covid-19’s impact on the real estate market… here it comes.

Thu, 19 Mar 2020 17:31:51 GMT

We have the advantage in the US to play 20/ 20 a little bit as the trajectory of our Covid-19 cases lags behind other countries by months and weeks. So, can we take a look in say Italy on the effect to date on the real estate market? Home sales are down by 7% in Italy the first two months of this year and in March visits to for sale listings have decreased by half. “Business is frozen as more people are postponing moving plans because of the coronavirus, or are hesitant to show their homes to strangers out of fear of contagion,” real estate broker Mr. Park, whose office is in Seoul’s central Seongdong district, told ChosunBiz. Or, can we feel a little bit more hopeful that our local efforts in RI will mitigate how severe Covid-19’s impact here? Let’s hope so. As our daily cases have yet to spike, we can be thankful that our local leadership as well as the patient #1’s responsible actions may have just been enough to offset a rampant spread. However, economic hardship is inevitable. If you have some faith that our institutions are a lot healthier than in the crash of 2008, I think it is reasonable to expect a less painful bounce back- again, of course depending on the severity of the pandemic. Stay sanitized and have compassion for our at risk population as we all sacrifice.

https://therealdeal.com/2020/03/12/real-estate-was-booming-in-milan-and-seoul-then-came-coronavirus/

Perks of Condo Ownership- Are they really worth it?

Wed, 11 Mar 2020 14:07:40 GMT

A buyer’s lifestyle will really steer their chose in type of home ownership with single family homes obviously providing much greater sense of privacy and autonomy. However, if you have rental living experience and really like the vibe of being part of a community in much closer proximity, than a condo might provide you a life style you already enjoy while allowing you to reap home ownership benefits. From my earlier blogs, an association’s health must also be evaluated when buying a condo- not just the condo itself. That aside, what are the other condo ownership benefits? I would put time at the top. If you are busy and are looking at condos in well managed complexes, you are going to save a lot of time living in an association versus a single family home. If you have a healthy amount of trust in the board and management, your involvement in every decision made on behalf of the association is not needed. Common area maintenance such as lawn care, snow removal, seasonal maintenance are all items generally taken care whereas in a single family home you would have to coordinate all such services. Condos can also enable you to buy into areas that you might not be able to afford otherwise. If you really love that historic waterfront neighborhood but the single family homes are just out of your price range, a condo in that same neighborhood could make a home there with in your reach. Finally, some associations offer really cool amenities such as recreational facilities or common area entertainment zones. Lifestyle and home ownership affordability are central to whether a condo is really worth it.

Time to crunch! Loss of rent & cash flow.

Thu, 05 Mar 2020 17:36:59 GMT

Time to crunch! Loss of rent & cash flow.

It’s become very popular for first time buyers to purchase a multifamily as their first home. With the added rental income, they can essentially buy “more” than what they would qualify for on just their income (qualify for a higher sale’s price). This has become a popular topic for me to blog about because I went through the great foreclosure crisis hand in hand with so many property management clients. I remember clients in tears because they were losing their property and their credit would be ruined. I also remember how the impact of tenant turnovers or the cost of a difficult eviction could be enough to tip the scale. If you are a new buyer it may be difficult to visualize the devastating effect the past foreclosure crisis had on so many home owners but I would caution you the future may not always be so rosy. Let’s talk some numbers again. Say, you are looking at a three family priced at $250,000. You intend to live in a unit and rent out the other two. Your monthly payment is about $1100. Not bad- that’s kinda like your rent payment right? Well, let’s add in some property taxes and insurance and it jumps up to $1500 a month. Still not that bad when you consider that you have rental income of about $2000 a month coming in. You figure your rent will cover your mortgage and repairs. Sure, in a good year when nothing goes wrong it will. What happened to so many caught in the foreclosure crisis is they were not prepared for the downturn. Rents sank, turnovers and evictions increased, looming repairs mounted and many homeowners just could not keep their heads above water. In yesterday’s blog example, I discussed how your $1000 rental decreased to an effective rent of $725 a month in this type of economy. That’s a decrease of $275 a month. Multiply that by 2 for two rentals. That’s $550 less a month in your pocket every month. Combine that with the need for greater cash output to turn over units (bad economy tends to breed rougher move outs) and it’s an environment ripe for cash shortages. Take away: run good and bad economy scenarios to see how the numbers work and always plan to fund that rainy day account.

So it’s really easy to rent out my units, what’s the big deal about being a landlord?

Mon, 24 Feb 2020 20:20:39 GMT

You are right: with a very strong economy and historically low unemployment rate, finding tenants who can afford to pay their rent isn’t that difficult. The healthy job market allows for gainfully employed tenants more likely to be pay their rent regularly. But, what happens in a less robust economy? Higher turnover for one. As tenants have a more precarious time holding a job, it is more likely they will have to move in between apartments as their ability to afford rent also shifts. A chunk of the population will also be forced to downsize and live with family or friends to get by- the potential rental pool will shrink. Let’s talk numbers. Say you have an apartment you rent for $1000 a month and within a year in a good economy, you have 100% occupancy. Cool. Now, in a bad economy you have had two tenants move in and out and you were forced to lower the rent to $850 a month. During the turnovers, you had a month and a half of vacancy because you needed to do repairs. Did I mention that tenants in a bad spot have a habit of leaving a lot of their stuff behind and forgetting to clean? That makes your effective rent only $725 for that year. This is a good way to visualize how increased turnover can affect your cash flow. Imagine living in a three family under these circumstances? The “effective” rent of $725 doesn’t even take into account the repairs you had to make from tenant turnovers. Take away is to crunch the numbers for any type of rental property in today’s economy as well as a future less robust economy. No one wants that investment that was supposed to spring board you into attaining wealth to turn into why your credit got ruined.

Condo fees… how low do you go?

Wed, 19 Feb 2020 16:09:00 GMT

If you are in the market for a condo, don’t fall into the trap of comparing condo fees without looking at their budgets. We manage quite a few condo associations and it’s not unusual for existing owners to have a debate over how high or low condo fees should be. But, at the end of the day, there are pretty typical expenses that go into a budget and not a lot of fudge room. So, if you are looking at two very similar condos but Unit B’s condo fee is a $100 more per month, don’t cross it off! You may just find out that Unit B belongs to an association that has a “real budget” and Unit A’s condo fee is artificially low. Artificially low? What does that mean? It means the budget does not adequately account for regular operating expenses and/ or has no line item for reserve savings and/ or has no line item for building repairs. The sad truth is this happens all the time. And, even though this may be contrary logic, you should be more wary of the associations with artificially low fees as they may also have been lax with keeping up with building repairs over the years. Thus, that cheap condo fee could land you in a world of trouble when you buy the unit and your percent share of the common areas. With proper due diligence, you can discover a lot of this history BEFORE buying and make an informed decision.

Buying a condo- what to ask for?

Mon, 10 Feb 2020 16:54:20 GMT

We in Rhode Island and especially Providence love our small condo associations. As unique as the one of kind historic buildings they are often housed in, as a buyer you should view each association as its own snowflake and be careful not to make any assumptions. If you are moving in from out of state, stop right there! You may associate condominiums as larger clusters of units, ran by well-established management companies. Not the case here. We were great fans of turning all types of buildings into condos, many of which are smaller buildings housing as little as 2 to 10 units, and they are ran in all sorts of ways- some self-manage and there are many newer property management companies out there which provide a huge range in quality of service. So, while you are busy checking off which units have those perfect attributes, I want to add some to your list. It is really important to evaluate how the association has been managing. You can began by requesting copies of the two most recent meetings notes and of course a budget. Your agent can reach out immediately to the listing agent and get as much information as possible such as a list of recent common area repairs and any information on upcoming repairs. These simple steps should actually net a lot of information. The budget will quickly give you a sense if the association is adequately funding common area expenses and whether or not it includes a line item for reserve funding (which most lenders want to be minimum of 10% of the budget). The notes will reveal how thoughtful the association is. The more organized will also be able to share a five year plan so as a buyer you can have a near future snap shot of many common area projects need to be funded. On the flip side, if the association can’t provide any of this information, you may be walking into a mis-managed black hole which will more than likely be a time and money suck.

Condos: Why budgets really matter!!!

Thu, 06 Feb 2020 16:11:33 GMT

Condos: Why budgets really matter!!!

I have found myself on the opposite side of the fence a few times lately where we have been handling an individual condo in an association we don’t manage. A recent example of what not to do really glares: we renovated a condo, received an early offer pre-mls and are happily in contract. I reached out to their management company over 20 days ago and still have not received most of the information requested, one of which is the 2020 budget. You may have heard that budgets have come under increased scrutiny by lenders looking to make certain the reserve line item is in there and funded at a minimum of 10% of the total budget. Without a real budget, unit owners become handicapped trying to sell their units and values will fall in the entire complex. All of this is so easily avoidable but it is important to make certain the management company is doing their job. Take away, the proceeding year’s budget should be created in early fall and voted for approval in the fall meeting. Look for that reserve line item!

Let us score for you!

Mon, 03 Feb 2020 20:18:10 GMT

According to Jennifer Billock, one of the best strategies for real estate beginners is to have an agent who has investing experience. Why would you want to buy a property using an agent who has never owned a property them self? Let alone an investment property? Billock sights the following reasons why using an experienced agent makes good sense as they are more likely to have:

• Solid rental price insight & legally appropriate lease language

• Up-to-date MLS statistics on home sales

• Granular neighborhood information

• Unbiased contractor reviews

• Current market trends

• Available homes appropriate for investing

• Awareness of fair housing laws

Let us put our almost 20 years of rental property ownership and management experience to work for you!

Don’t get stuck on curb appeal; you will maximize your investment if you make your own curb appeal.

Thu, 30 Jan 2020 20:54:55 GMT

Don’t get stuck on curb appeal; you will maximize your investment if you make your own curb appeal.

Don’t get stuck on curb appeal; you will maximize your investment if you make your own curb appeal.

This may be upside down logic if you are searching for your new home but if you truly want to optimize that investment, it’s time to embrace out of the box thinking. This is not for everyone and should not belittle the personal nature of buying a home. According to David Hicks , the CEO of HomeVestors, a well-known national real estate investor franchise founded in 1989 famous for its promise to buy “Ugly Houses:” “They have to remember they are not buying it for themselves. In fact, we tell people that if you drive up in front of a house and say, ‘Wow, I can live here!’ you probably want to drive around the block because you are about to make a mistake” In other words, curb appeal is one of those manageable variables you can do yourself once you own a home. You can leverage lack of curb appeal with your own sweat labor for a gain in resale cost.

How To Optimize Equity

Tue, 21 Jan 2020 15:59:41 GMT

Equity is the difference between what your property is valued (an ever changing figure) and how much you owe (generally your mortgage principal). One of the easiest and most painless ways to create equity is by paying additional principal payments every month. Even an additional $50 a month on a 30 year, $200k mortgage will knock off over 2 years of payments. The mechanics of compound interest at work here. If you are on a five year plan and reselling is in your near future, your money might be better spent on updating. Appliances and fixtures (think light fixtures and faucets for example) are an easy first step. Bringing your home to a neutral color scheme is also very manageable. And, of course, the obvious: curb appeal. Spend some time outside making the first impression an eye catcher. Working backwards, if you are thinking about buying you don’t need the condo with the brand new appliances. Buy one for less without them and do it yourself. Your home or investment’s equity is arguably the average American’s greatest asset. Maximize it!

Are you ready for that game changer move?

Mon, 13 Jan 2020 19:48:05 GMT

Most of my blogs are about using caution and not over leveraging yourself or buying a property that has limited chances to appreciate. For those of you out there that are paying your rent with ease, have some general sense how to fix things or a good ability to find the right people to fix things for you, and have achieved financial stability (low debt, 3-6 months living expenses in savings, etc.), let’s make now the time to move. If you are in this category, you most likely have also saved a good bit of cash. Good start! And, you probably have enough wherewithal, whether you know it or not, to try something a little different like a 203k loan. Time to sit down with a loan officer and find out what your lending parameters are. Then, pair yourself with us and let’s shop. If time is on your side, there is no need to rush. Don’t feel compelled to buy in the busy spring market (which lasts a lot longer now) and understand that this could take some time. I mentioned a 203k loan because your best chance to maximize appreciation is to buy a property that needs work. If you want to maximize your dollar, its best to think out of the box. Down the road as you find yourself becoming a savvier buyer you will be happy you didn’t began by overextending yourself.

So when is it time to evict?

Wed, 08 Jan 2020 19:53:35 GMT

The industry rule of thumb is you should not allow your tenant to be more than a month behind in their rent as their chances of being able to repay diminish greatly the further behind they get. By law, you can begin the eviction process on the 21st day of non-payment if your 5 day demand has been mailed out exactly on the 16th day of the month (our policy at Divine Investments). Does it ever make sense to wait? Of course, tenants are people and having some basic understanding of your tenants will help guide your judgement when to give them a chance and when giving them a chance will back fire. If your tenants has paid faithfully for a year and ran into unexpected hardship and tax refund season is coming this could be an example of when waiting will be beneficial to both parties. We work really hard here to minimize vacancy rates and like to turn apartments over with no vacancy when possible. However, in most cases a tenant turnover will result in loss of rent and some cost to get the unit ready for re-rent. Having a good property manager will help protect your investment by giving sound advice: when is waiting worthwhile? What is the current condition of the unit like (remember we walk through all our managed units twice a year)/ how much will the re-rent cost? Finally, if eviction can at all be avoided, it should. The best option can be a negotiated move out with your tenant if they truly cannot afford their rent anymore. More to follow.

Is your financial house in order?

Tue, 07 Jan 2020 15:44:04 GMT

One of my most memorable lessons from a mentor figure is that I had to treat my credit like my health. She put the idea of creating and managing credit into a neat little picture my high school maturity could grasp and, of course, with a lot of practice it became a skill I honed and was a godsend as most of my adult life I’ve had to finance all different types of real estate. You can qualify for loans with credit scores in the low 600s but is this really a good idea? If your credit is rocky for reasons other than an isolated major life event like divorce or a health crisis, take the time to get your financial house in order before taking the huge step of buying real estate. It will only become a lot harder to get all the wrinkles out with that monthly nut to crack.

The lead law- Come again? You said I could get sued?!

Fri, 03 Jan 2020 16:30:15 GMT

Yup. And, it’s really important to understand if your property’s insurance would cover you in the event of a lawsuit as many policies have exemptions for lead based paint poisonings. As my youngest son has been lead poisoned twice, I don’t ever want to diminish how important it is to maintain your rental unit for the health and safety of your tenants but there are also times when you may find yourself at the end of an unfair lawsuit as a landlord. But, the best news is you really can protect yourself if you follow the law. For instance, one of my own tenants many years ago threatened to sue me when her baby had an elevated lead level. But, I had my lead conformance in place. What we also have gotten into the habit of doing is emailing all new tenants the lead safety pamphlet instead of just printing out a copy. Our standard lease also requires an initial that the tenants received a copy. Her lawyer lost interest. And, of course, because there was a baby involved, I immediately got out to the property, did a walkthrough of the unit, and remedied any potential issues (and, yes, many tenants especially those with children can be rough on units causing perfectly intact paint to become a lead hazard in no time). Finally, education helps everyone. When we hand a tenant a lead safety pamphlet, we also explain to them why it is so important to read and inform us if any new issues arise in their unit.

RI Lead paint law- what you need to know!

Thu, 02 Jan 2020 16:01:04 GMT

If you own a pre-1978 rental property (or if you have children period), you should be familiar with this law. Unless you are an owner occupant in your rental property, you are required to get a lead conformance certificate every two years or upon a tenant turnover, whichever is longer. However, this is not usually enough. Lead is a huge liability and like fire coding it is an area you just can never be too safe. Particularly harmful to children under age 6 whose nervous systems are still forming, lead causes irreversible damage and can be a hot button law suit for a tenant. Every child is required to get annual lead screenings and if a level comes back elevated, the first place any agency will look is the child’s home. That’s why it’s a good idea to get ahead of the law. Walk through your rental units at least twice a year. Look for any potential lead hazards and have them mitigated right away. Remember a child only needs to ingest a quantity of lead smaller than your pinky nail to get poisoned. Yes! We have taken the lead hazard awareness course here at Divine and we have vendors who have the lead remodeler license.

How far do you go?

Fri, 20 Dec 2019 14:40:40 GMT

When buying a property, how far ahead do you ballpark the lifetime of your building’s main components (roof, siding, mechanicals, asphalt, ect)? Well, how long do you expect to own the property? Double that as this is real estate and this is Rhode Island. Why do you need to do this? Because even if you are buying a personal home, let’s think like an investor and do this right. You should have an idea how much longer your roof will last, what the cost will be to replace it and as a result how much you should be putting aside each year to save for this expense. Very simple: total cost divided by estimated years remaining before replacement is needed. Getting an arithmetic headache? We walk through every unit we manage twice a year and will help you make a realistic budget and timetable for capital improvement projects.

Surprise!

Tue, 17 Dec 2019 19:00:28 GMT

No it’s not a Christmas present… just me re-visiting one of my favorite points about buying in Rhode Island. Our housing stock is old, among the oldest in the nation. You are probably aware that your purchase and sales contract allows you an inspection period where you can hire an inspector of your choice to evaluate the condition of a property you have interest in buying. I have worked with many very competent inspectors over the years but you simply cannot discover every issue. In fact many are concealed within the walls. For instance, that “newer” wiring coming out of three “newer” looking panels in a multi-family can be spliced into knob and tube behind a wall. Yes, you can check the outlets to see if they are fed by knob and tube but what if the knob and tube is just feeding the lighting circuits? Oh, and every units’ lights are all on one panel? That’s not cheap. Take away: you need some wiggle room in your savings account when buying older properties for hidden unpleasant surprises. Decades ago, my first night in my first building, was spent in rain both outside and inside. No one told me that flat roof had failed….

So you mentioned $25,000…

Thu, 12 Dec 2019 15:25:40 GMT

That’s right. In my prior example of appreciation (blog 12/9) I discussed the example of a home appreciating $25,000 in 5 years but I also referenced investing $25,000 into the property to get that appreciation. Now this is just an example but if the thought of coming up with $25,000 is leaving you feeling unmotivated let’s think about it in different ways. First off, this is over a five year period, so we are talking about $5000 a year. Sounding more manageable already? Secondly, are you handy? If so, there are many home improvements you can do yourself that will greatly reduce the cost but still give you the same appreciation. Not handy but have a good eye? Well that works too. As any real estate agent will tell you, presentation helps a lot and if you have that golden touch for interior renovations that equates to a value as well. Or, you could have your own strength. Personally, when I bought my first building I had no background in real estate or local contacts but I found out I was really good at finding the right subs (serving me later with my property management business). Thus, even though I didn’t do any of the rehab myself I probably saved a lot of money being selective with who did the work. Take away: when you are buying your first home or investment property, you should have a list in mind of possible projects that will add to your property’s future appreciation. If you are really good, you will also have a sense of how much each will cost and how much each would increase your home’s value.

Monday Motivation. Let’s take it to the top!

Mon, 09 Dec 2019 19:16:58 GMT

Monday Motivation. Let’s take it to the top!

If you are like one of us 100 million plus American home owners, you are likely to agree your single biggest investment is your home. It is your largest fixed asset and most likely the source of most of your capital expenditures. So, how do you make it work best for you? When purchasing, besides the amazing attributes that make a particular home pop for you, the home’s ability to appreciate in value needs to be right on the top of qualities to consider. Appreciation? This is how much the value of your house will increase (yes value can also decrease) over time. For example, if you bought a $200,000 home and invested $25,000 in improvements and then sold it for $250,000 5 years down the road, it would have appreciated $25,000 in that five year period. $25,000 is a lot of money to most of us and while this sounds a lot simpler than it is, I have watched myself and many of my friends increase their capital by doing just this. The take away is that you need to think like an investor even if you aren’t when purchasing. More to come.

Fringe Neighborhoods, when they are your friend

Fri, 06 Dec 2019 20:04:48 GMT

Fringe Neighborhoods, when they are your friend.

So, you are looking around for your next investment and the market is pretty hot and finding deals is difficult. Time to think out of the box. If you are buying residential income properties and their prices have been rising it is very likely rents have been rising as well. Thus, some neighborhoods will become unaffordable for a segment of normally stable renters which means they have to move somewhere else. Yes, some may consider this gentrification but, however, you qualify it keeping an eye on changing neighborhoods can be invaluable to your next investment. The trick is identifying these changes before the real estate market has a chance to catch up. As the real estate market is notoriously slower moving finding an investment may be easier than identifying the right fringe neighborhood. If you already own properties and you are not a renter yourself, speak to your tenants. They can be an excellent source of information and much more aware of the rental market than you are. Notice if your vacancy rates have become very very low and you are having less and less trouble keeping your rentals occupied. This can signify a change in rental market.

How much is not enough???

Mon, 02 Dec 2019 20:20:30 GMT

How much is not enough???

So, you were introduced to a loan officer who immediately got you pre-approved and let you know about all the really cool programs going on for first time home buyers like the down payment assistance program from Rhode Island Housing. Your friend told you how they just bought a house and got a cash concession from the seller toward their closing costs so they really didn’t have to come out of pocket too much. That’s pretty amazing isn’t it? It sure is but this should not persuade you to buy a property if you truly do not have enough in the bank. My number one caveat with any first time home buyer is that the majority of our housing stock is old. Crunch the numbers first and then crunch them again! Make certain you are financially prepared to own. For example, you do not want to be cash crippled or maxing out your credit card when you find out that the roof really needs to be replaced this year, not five years down the road like you were hoping. How much does replacing a roof cost by the way anyway??? If you are thinking of buying this is something you should know! Work with us and we will work with you so you are prepared.

Investor blog

Wed, 27 Nov 2019 16:12:34 GMT

Investor blog

The ugliest property on the block. The listing caught your eye because of the price but the pictures discouraged a drive by or when you did drive by you immediately noticed the bowing out foundation. Some of my most memorable transactions have been working with investors with a great eye for hidden gems. Of course, you need experience on your side if you are tackling structural issues and the right set of engineers and contractors to help you assess the extent of any issues. But, that’s the right connections, time sink of your resources and then just a number. How much is that scary looking problem going to cost to resolve? That problem that scared off every other buyer and left the property sitting for half a year? Well in the case with the foundation, a 27% concession in sale’s price, netted a sweet investment! A facelift transformed the curbside appearance and the structural problem while intimidating was completely fixable. In an up market, investors must think more and more out of the box to find true, solid investments.

Home Buyer’s Blog

Thu, 21 Nov 2019 15:06:54 GMT

Are you a landlord? And, the bigger question do you have the right personality to do it long term? If you are thinking of buying a multi-family to be your home and as an investment property, you should always be prepared that you may need to own it long term. The real estate market although historically slower to react than financial markets can hit a hard cold bottom as we saw not too long ago. So, while you may be excited with visions of upgrading kitchens and rents, also weigh the pros and cons of a long term relationship as a landlord. Not all landlord/ tenant relationships are blissful and some end in eviction court. If your eyes are glossing over reading the RI landlord tenant handbook or the lead safety pamphlet, maybe you should reconsider that a single family home or a condo is the better fit for you. Undecided? Come ask us- we have every tenant story under the moon to share. And, of course, we can also manage the property. If we lived in an ideal world we would all buy properties whose values appreciate every year and we could resell with ease at any time. In this market, this may be true for the near future. BUT, since your home is generally your single biggest investment, be prudent and think it out long term.