First Rate Property Management’s vacancy rate improved from last month to just over 4%. However, we’re still finding the need to lower rents and offer incentives to get any applications. Additionally, we have a handful of properties that just aren’t renting, even after we lowered rent. In recent months, I’ve been able to identify exactly why rents are down. We had job losses, tenants buying homes, and financial reasons. In June, the number one reason stated on the notices to vacate were that they found cheaper rent elsewhere. “Buying a home” moved down to the #2 reason. With not a lot of homes or even multi-family dwellings being built now, I am just surprised at the low demand and what is bringing rents down. The local paper recently stated that the Idaho Unemployment rate just set a 22 year high and that Idaho is now leading the nation at 9.6%. We have over 58,000 people without work. I’m sure that this is not helping. I think it is safe to assume that we have tenants moving out of the area to find employment with very few moving to the area due to poor employment opportunities.
In May, 60% of the duplexes and four plexes that sold, were distress sales. Sales also picked up which help lower inventory levels. In May, I got a 1992 four plex under contract for $255,000. What a deal! Well in June, I got a 1994 four plex under contract at $225,000. Now that’s a deal! With prices like this and current interest rates, investing today just makes a lot sense.
As I reported, the new site is now up and running at Boise-Rentals.com. We’ll be testing the new and improved owner statements this month on my properties and a select few owners. Additionally, our current website host also host our emails and we need to get that moved over. One of the cool things that we added are videos on the FAQs that allow our tenants to trouble shoot maintenance issues like a clogged toilet or a jammed garbage disposal.
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