Boise Area Rental Vacancy Rate: Currently, First Rate Property Management Inc. has a 2.8% overall vacancy rate. Compared to last year at this time of 3.9% and in 2009 at 6.5%. This low vacancy rate is the result of policy. First Rate Property Management does not have leases expire in the months of November, December, or January. The only reason we have notices in these months is because the tenants lease had expired before those months and wanted to remain month-to-month. When faced with a situation like that, we have to decide: Do we require the tenant to extend through the winter months and if the tenant refuses do we give them notice to vacate so that they can be replaced with a long-term tenant. Or, do we allow them to revert to month-to-month at a bit higher rent and hope they don’t choose to vacate in the winter months. The concern always is that when you force a tenant renew or vacate and they choose to vacate, the owner will have lost rent, advertising costs, and turnover costs. Which is better? So by default, we allow the tenant to go month-to-month unless the owner requests us to force the long-term lease renewal.
Wealthy Investors Target Large Multi-Family Complexes:
Below is a link to an article published on the online Idaho Business Review, stating that deep-pocket investors are seeking large apartment complexes over single family homes, duplexes and four-plexes. I don’t necessarily agree. The fact is, that with the decline in values of single family homes, duplexes, and four-plexes, they are performing very well. In many cases a four-plex will perform better than a large apartment complex. It simply depends on price and effective rents. Plus, a four-plex down the road is most likely going to be easier to sell. What I have seen is that investors have gone to apartment complexes because there are so few four-plexes available right now. There are definitely many buyers out there wanting to take advantage of the low prices and interest rates and in most cases, the return is greater than anywhere else they can put the money. With that said, I have seen more investors purchasing rental properties using their IRA funds in recent months.
Tony A Drost
First Rate Property Management, Inc
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