Knowledge Center

Sacramento

Rent Growth for Sacramento Housing Remains High

The government has historically propelled the Sacramento area economy, but the private sector continues to expand. As a result, the regional economy continues to diversify, creating additional demand for rental housing. WeWork, for instance, signed a lease for 47,316 square feet at downtown’s Wells Fargo Center, marking the company’s entrance into Sacramento. In addition, tech startups continue to relocate to Sacramento from their more expensive neighbor to the west, San Francisco. Even tech stalwarts, such as Apple, Intel, Micron Technology and Hewlett Packard Enterprises have operations in the Sacramento area.

aerial view of buildings in Sacramento

Sacramento Economy Continues to Diversify

Government employment constitutes 25% of all jobs in the metro, the highest share of public sector employment in the country, leading Washington, D.C. Professional and business services, as well as the leisure and hospitality sectors, have been among the strongest growth sectors this cycle. The education and health services sector has been also continues to contribute to job growth, ranking among the metro's best-performing sectors. Total employment in this sector is approximately 35% above its pre-recession peak. Sacramento’s relative affordability remains one of the metro’s biggest draws. Household growth in the region surpasses the rate of single-family home and apartment deliveries, and population growth is expected to outpace the national average over the next five years. Furthermore, Bay Area, Los Angeles and San Diego residents continue to express interest in Sacramento rental housing to escape exorbitant housing costs in those markets.

Year-Over-Year Job Growth line graph

Sacramento Rent Growth Soars Above 4%

Rent growth in Sacramento continues to rank near the top of the U.S. among major metros. Elevated demand has far outpaced the limited number of deliveries this cycle, boosted by the healthy economy, rising home prices and exodus of Bay Area and Southern California residents searching for affordable housing alternatives. These dynamics have created tightened rental market conditions, providing property owners with leverage to push rents aggressively in recent years. Rent growth averaged almost 9% from 2015 to 2017 and reached an all-time peak of more than 10% in 2016. Rent in the Davis submarket, where the University of California, Davis is located, commands some of the highest rents in the metro area, according to a new CoStar report. Asking rents in Davis are about 30% higher than the metro average because of strong student housing demand and air-tight vacancies. Elk Grove and Roseville/Rocklin also feature rental rates well above the metro average, at about a 20% premium to Sacramento.

Sacramento Market Rent per Unit & Rent Growth bar and link graph

New additions to the area have had a minimal impact on lowering rents: Average asking rents for properties built since 2010 is approximately two times higher than the national average. Rent growth since 2015 has far outpaced income growth, consuming approximately 25% of the area’s median household income. Long known for its affordability, Sacramento may lose some of its luster if rent growth continues to exceed income gains. However, despite the surge in recent years, Sacramento’s average rent remains a fraction of average rents in the Bay Area. As a result, ex-patriots hailing from the Bay Area, Los Angeles and other expensive metros, should continue to relocate to the region in upcoming years.

Bay Area and SoCal Exodus Pushes Vacancy Rate Down

Sacramento’s lack of new rental housing construction, positive demographic trends and solid economy have placed downward pressure on vacancies. Vacancies have remained under 5% for many years, and that trend has continued in 2019. In fact, rental market vacancy metrowide stands at 4.3%. Since 2013, the average vacancy rate is about 150 basis points below the U.S. average. Consistent with historical trends, Sacramento draws some of the strongest per capita migration in California, particularly from the Bay Area and Southern California, thus boosting demand. A combined 30,000 residents relocated to Sacramento from the San Jose and Los Angeles metros between 2012 and 2016. For more insight on the Sacramento rental housing market, download our latest State of Mynd Sacramento report today.

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What Does Seattle Property Management Cost?

At Mynd Property Management, we are introducing a series about investing in Seattle real estate. If you own rental properties in this market or you’re thinking about making some Seattle investments, you want to be successful.We’re talking to someone who knows how to do it successfully.Alex Osenenko is joined by Enrique Jevons, who manages 850 units with his team in the Pacific Northwest. Not only does Enrique have a successful track record of managing homes professionally, he has a personal interest in how to succeed with Seattle rental properties. He owns 73 of his own. So, with over a decade of experience, we asked him to help us tackle some of the questions we hear most frequently from current and potential investors. Whether you’re already managing a portfolio of Seattle rental properties or you want to get into rental property investment, pay attention to the things we’re talking about in this series. You’ll learn a lot and increase your chances for profit and performance.We are tackling one of the questions that we hear most often from investors. It’s a question that owners and investors all over the world ask when they decide to invest in real estate: What does professional property management cost? We’re talking about the costs specific to Seattle property management today. We’ve asked Enrique to walk us through the pricing schemes that management companies use in this market, and we’re exploring how property managers put together their pricing structures and how those are then represented to the customer.

Before You Invest: Build in Property Management Costs

Before You Invest: Build in Property Management Costs

One of the best ways to prepare yourself for the cost of professional property management is to build in those costs when you’re budgeting. Before you buy an investment property, you do a lot of math. Take a look at what you can expect your rental income to be and you compare that to the purchase price and you think about expenses such as vacancy and maintenance. Another cost to add to your calculations is professional property management. When you’re able to plan for this expense, it’s not going to deter any cash flow or return on investment. It’s already built into your expenses.Maybe you’re planning to self-manage, so you don’t think that including professional property management costs is necessary. That’s not entirely true. The reality is that you need to take into account what those management costs will be. First, when you sell that property, the buyer may not be planning to self-manage. So, he or she will want to have that expense already determined. Second, you might turn the property over to professionals one day in the future. Or perhaps you’ll start acquiring a larger number of rental homes and realize you need some help. Maybe your professional career will take a turn or you’ll have new family obligations. When you’re prepared for the cost of property management, you strengthen your investment.So, determine what those costs are going to be before you buy. A good investment property will perform well, regardless of whether it’s being professionally managed or managed by the owner.Something else to consider is that your time has a lot of worth to it. So, if you’re managing your own investment property, take your own personal time into account because that’s worth something. When you manage on your own, there’s an opportunity cost. The time you spend finding residents, showing your properties, executing leases, screening applications and responding to maintenance is the time that you’re not spending on something else.What would you do with that time if you weren’t busy managing your property or portfolio? Maybe you would be looking for other properties to manage. Or, perhaps you’d be more active diversifying your investment portfolio into other assets, such as stocks or bonds. Maybe you’d just be taking more vacations. The point is, your time has value. While you may not be paying a management fee every month, you’re still spending money. It’s just spent differently.Include the property management cost in all of your calculations, spreadsheets, budgets and projections. If you don’t end up spending that money yourself, it still needs to be reflected.

Average Seattle Property Management Costs

Average Seattle Property Management Costs

The amount you pay for property management will depend on the company you choose, the services you need, and the type of rental property or properties you own. Each company structures its fees differently and each company has certain things that are included and certain things that will cost more. But, you need an average number as a baseline. So, based on all of our data and all of our research, and all of our number crunching, we can provide an average that you can safely use.We recommend that you use 10% as the general management fee to expect. When you actually close on a property and find a management company, it’s possible that you find you’re only paying 8% or maybe you’re paying as much as 12% For the purposes of budgeting and projecting, let’s compromise and use the average: 10%. When say 10%, we mean 10%of your rental income. So, if your Seattle rental property has a rental value of $2,500, the monthly management fee you’ll pay is 10 percent of that, or $250.In addition to the monthly management fee, you can expect to pay the equivalent of a full month’s rent for the lease-up fee. Unlike the management fee which is paid monthly, the lease-up fee is only paid when you’re looking for a new resident. It includes things like marketing and showings and screening and lease execution.Residents of single-family rental () homes tend to remain in their residences for a term of three years. Anecdotally we have found that residents will stay for a few years and then move on if they decide to buy something on their own or they travel to a new location. So, that lease-up fee will need to be factored in for an expense that’s paid every three years. With some residents and some residents, turnover will be more frequent. However as far as finding an average, expect to pay a leasing fee every three years on a single-family home.With apartments, turnover is typically higher. You can expect your residents to move out a little sooner. Lease terms for an apartment unit or multifamily units tend to turn over every two years, on average.When you’re calculating averages, it’s better to be conservative. Use these numbers while you’re planning your rental property expenses and you’ll have an accurate look at what your property can potentially bring in and what you’ll be spending.There are smaller micro-economies throughout Seattle and of course throughout the country. But, these averages are good numbers both for Seattle, the Pacific Northwest, and most rental markets.So, you’ve got your 10% number and you’ve got your number that equals a month’s rent. Those are the property management fees you should be including in your calculations.

Evaluating the Cost of Property Management

Evaluating the Cost of Property Management

When you’re choosing a property management company, cost should not be the driving factor, but it’s something you’ll want to explore. Make sure you’re thinking about these averages when you’re examining a price structure. With an average management cost of 10%, a slight alarm bell should go off if you find a management company that only charges you 4% every month, for example.What are you really getting if you’re only paying 4% every month? And, how much more expensive will those other services be when you need them? It’s the same with leasing fees. If you come across a company that only charges a flat fee of $50 for a lease-up, you should definitely hesitate. How could a property management company possibly advertise a property and screen a resident for so little money?Property management costs will be varied. You’ll find companies that are all-inclusive and companies that have a menu of a la care services. Either model works, as long as you choose what best suits your own personal needs.To find out what Mynd Property Management charges for professional Seattle residential management, all of our fees are published on our website. It’s part of our commitment to remaining transparent to our customers.We’re here to help. If you’d like to know more about professional property management pricing, please contact us at Mynd Property Management.

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Top Three Things that Cost Investors Money

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Sacramento investors have a lot to account for when thinking of renting a property. While some expenses may seem obvious, this is not always the case. Scott Raymond is the founder of Raymond Property Management, now part of Mynd. Today, he is here to discuss with us the top three things that cost investors and landlords money in this competitive market.Scott Raymond: I can hit anything you throw at me man, and we'll hit it out of the park.Alex: Let's do this. Boys and girls, welcome to another episode of Scott and Alex talking about investing in Sacramento. Well, mostly Scott. I'm Alex with Mynd Property Management. My guest today is Scott Raymond. Scott, how are you?Scott Raymond: I'm doing great, Alex. Hey everybody.Alex: Hey, great, thank you. Look, just to set him up a little bit for you—Scott's got over a decade of experience as a successful investor in Sacramento. He's also a founder of a company called Raymond Property Management, a large company that's now a part of Mynd. Very excited about that. Today's topic is the top three things that cost Sacramento investors and landlords money. What are your top three, Scott?Scott Raymond: Hey Alex, great topic. Number one, lease up time and vacancy loss. To me, this is probably the number one killer of investment return. This is basically the time that it takes for the units to sit vacant while they're being worked on, painted, getting ready for the next tenant—the time that it sits vacant during the marketing and showing process to new tenants and ultimately getting a new tenant to move in. Think about it. It's basically rental income that'll never be recaptured. Every day that the unit sits vacant is rental income that will never be recaptured. So not getting the unit turned quickly, not pricing the unit properly, and not having a full online presence and automated showing and application process will inevitably result in significant vacancy loss for investors.Number two is deferred maintenance. This is basically the fact that it invariably costs more to react to a deferred maintenance issue than to be proactive and have a set schedule of when certain things get updated and replaced. For example, a water heater that is well beyond its useful life will cost roughly about 800 bucks to replace under normal circumstances, but will cost somewhere between $1500 to $2000 to replace under an emergency situation where you're calling someone in the middle of the night or on a weekend.And then number three—really trying to self-manage. Self-managing really means being totally up to date on fair housing compliance, on code requirements, rent control regulations, and other regulations. Not being up to speed on these things will inevitably result in trip and fall claims, habitability claims, fair housing discrimination claims, eviction challenges, and a lot of other things that could be very costly for an owner. It's far more costly than simply hiring a property manager. Those are my top three.Alex: Very good top three. But look, there's not all doom and gloom. There's a lot of opportunity to Sacramento. Scott and I have another episode that talks about all of the advantages and opportunities of investing in Sacramento. Check out Mynd.co, M-Y-N-D.co. It's our website. Just search for Sacramento investing and you will find a number of episodes on this subject. Hopefully today this video helped you out in your decision in potentially investing in or hiring a property manager within Sacramento. Scott, thank you very much for your time.Scott Raymond: Thanks, Alex.Alex: And thank you for watching.Deciding to rent a property is a big decision. Doing so requires time, money, and quite a bit of attention. This is especially true for those looking to self-manage their property. Keeping on top of maintenance requests—particularly in an emergency—or simply accounting for vacancy loss are both necessities when making such a decision.On the other hand, having a property manager to deal with such factors can be far less costly, especially for new investors. Whether it’s keeping up-to-date on codes and regulations or avoiding being gouged by vendors for emergency maintenance requests, property managers are simply the best way to navigate the Sacramento market and secure the success of your investments.

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Three Reasons Why Investors Fail in Sacramento

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In a competitive market like Sacramento, investors are always looking for ways to save money. This means having the knowledge and experience to make the right decisions when buying or renting a property. Today, we have with us Scott Raymond. Scott—who is the founder of Raymond Property Management, which is now part of Mynd—is here to share with us the top three reasons for failure in the Sacramento rental market and how investors and landlords can avoid making these mistakes and losing out on their investments.Alex: Boys and girls. Alex here with Mynd Property Management. We're talking all about investing in Sacramento and being successful doing so. My guest today is Scott Raymond. Scott, how's your day?Scott Raymond: It's going great, Alex. Thanks.Alex: Awesome. Always a good sport, Scott is. He is the founder of a company called Raymond Property Management in Sacramento, which is now part of Mynd. Very exciting. He is also an avid investor with over a decade of experience running all kinds of seminars and very interesting stuff he covers. So we're lucky to have him, today. The topic today is going to be the three reasons investors or landlords may fail in Sacramento. What are your top three, Scott?Scott Raymond: Top three today, Alex. Number one: they overpay for the property relative to rents. I've fallen into this trap. It's very easy when doing your analysis on whether or not to purchase an investment property to overestimate the rents that you can get on it, which could very quickly send the investment return into negative territory. So before you purchase any investment property, make sure you really, really understand the rents that you can get for it. Number two: they fail to adequately budget for expenses and vacancy. In that same analysis, it’s very easy to underestimate the cost of maintaining that property, getting the vacant units ready, and basically factoring in the time it takes to lease up a unit, which results in lost income which you'll never get back. And then they try to manage it themselves. Unless they're a full-time investor like me with the time to essentially look after the property on a day-to-day basis and show vacant units, do the bookkeeping and stay up on all the laws, investors really should hire a professional property manager and factor in that cost of management into their investment analysis.Alex: Now, I've had another interview with our expert from Seattle, and he was talking about fines being levied on unsuspecting landlords who don't follow fair housing and some of the more complex rental control, rent control laws. Do you see that impact in Sacramento? Have you seen some of the people you know getting fined or getting in trouble with the local city or the law?Scott Raymond: Yeah, absolutely. It seems like, as landlords, we have targets on our back from many, many different angles. The City of Sacramento has a rental housing inspection program, which is a city-mandated program that says all rental stock needs to be basically registered with the city, and then the city then has a team of inspectors that comes out on an annual basis to make sure that the unit's habitable and that there are no code violations. So if you don't have the property in that register, you can get fined. If you have the property in the register and they come to do an inspection and they find some code violations, you can get fined and be required to do the code violations. And now with rent control that just got implemented in September of 2019 in the city of Sacramento, there's all kinds of new regulations that could end up being very, very costly for owners.Alex: Mm. Here we go, boys and girls—pay attention to the laws. Hire a good property manager if you are not a full-time investor. But the market is still hot. Check out the other episode Scott and I have done on the five ways investors are actually successful in Sacramento, because it's one of the hottest markets in the country. And one of the things that Scott said is that there's a lot of flow from the Bay area money going into Sacramento. But you’ve got to watch that episode yourself. Go to mynd.co and search for Sacramento investing. You'll find a number of episodes Scott and I have done. So hopefully today this helped you out. Thank you for watching and Scott, thank you for your time.Scott Raymond: Thanks, Alex.Success starts before you buy a property. This means knowing which properties will offer the best return when thinking of making an investment. By necessity, investors will face expenses that, if not accounted for, could compound and become a major concern. This can mean everything from factoring in the time a property may be vacant, to complying with city codes and ordinances.Many such headaches can be avoided outright by hiring the right property manager. With the knowledge and foundation to account for such expenses or city codes, hiring a property manager can inoculate an investor from mistakes that might otherwise be avoidable.

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How to Choose the Right Property Management Company

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Technology has made choosing the right property management easier than ever, giving investors a better understanding of the range and quality of services a company can provide. Today we are speaking with Scott Raymond—founder of Raymond Property Management, now part of Mynd—about how investors can easily choose the right property management company for them.Alex: All right. Boys and girls, Alex with Mynd Property Management, talking all about investing in Sacramento. My guest today to help us demystify and build your successful portfolio in Sacramento is Scott Raymond. Scott, how are you?Scott R: Doing great, Alex. Thanks.Alex: Hey, Scott's got over a decade of experience—an extremely successful investor in Sacramento. He's also the founder of a company called Raymond Property Management, which is now part of Mynd. Very exciting. And today's topic is going to be an interesting one. Scott, as an avid investor, how would you go about choosing a property management company in Sacramento?Scott R: Great question. For me, it starts with determining basically who has the strongest online presence—both from a professionalism standpoint and also a customer rating standpoint. To me, this is important because the industry is really transforming itself into one that relies on technology basically to do everything from marketing units to receiving tenant applications and approvals, handling maintenance dispatching, owner communications, and a lot more.As for ratings, it's really easy to get poor Yelp and Google ratings as a property management company just because of how hard the business is, to maintain happy tenants and happy owners. So I think ratings, Google ratings, Yelp ratings will give you a pretty good starting point of who the top management companies are. Also, check out the quality of the marketing of the vacant homes that the property management companies are offering. Everything from how they take photos; do they have 3D touring of the units? Do they have a good editorial on the units themselves? Is the tenant application process easy? These things are critical to helping you get the units full.Obviously, cost is an important factor but shouldn't be the overall determining factor. It's really about the management company's coverage and depth of experience in your area that you're investing in, as well as the breadth of their services. So those are probably my top reasons.Alex: Those are really good top three. I've heard a lot of topics, I mean, I've done this for 10 years, and I think checking into how property management companies market rentals is—I've heard it maybe one or two times before—it's rare, but I think that's an important piece. Because, look, at the end of the day rent needs to come in and if the rent doesn't come in, the property is losing money. So that's a really good tip.Now a question for you, Scott. What do you think about published versus unpublished pricing? Do you care? If you find somebody who meets your criteria and you pick up the phone and call them versus somebody that has pricing up there on the website, how do you feel about either?Scott R: Well, as for me, pricing transparency is important. If they're not willing to put the price on the Internet, it makes you wonder: what is it they're hiding? What is the pricing strategy? It sounds like their pricing structure might be complicated. They haven't boiled it down into a simple, digestible pricing structure for tenants or for owners to understand. And so that would be a little suspect for me. All property management companies are generally within the same range. So if you're not willing to put it on the Internet, I would consider that a little suspect.Alex: Interesting. Well, Scott, thank you very much for your time. Folks, thank you for watching. And if you want to go and find more wisdom nuggets from Scott, go to mynd.co, M-Y-N-D.co. Type that up and search for Sacramento investing, and there'll be a number of episodes just like this one. Thank you for watching.Scott R: Thanks, Alex.Choosing the right property management company is imperative for investors thinking of entering Sacramento’s competitive rental market. Technology has made such a decision easier than ever, providing investors with instant access to lists of provided services and customer ratings.The way a property management company advertises their services is crucial, as well. Transparency in pricing can give an investor a fuller understanding of what services are provided and how much these services will cost. And though cost should always be a factor when choosing the right property management company, it is equally important for investors to know a management company's coverage and depth of experience in the area in which they have invested.

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What Do Property Management Companies Do?

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Property investment can come with a diverse set of challenges and responsibilities—especially in a competitive market like Sacramento. Today, we will be speaking with Scott Raymond—founder of Raymond Property Management, now part of Mynd—about different services that property management companies provide and how to choose the right one to meet your needs.Alex: Boys and girls, Alex here with Mynd Property Management talking all about investing in Sacramento and being successful at doing so. My guest today is Scott Raymond. Scott, how are you?Scott Raymond: Doing great Alex. Thanks for having me.Alex: Scott is the most experienced person I know in terms of investing in Sacramento. He's got a decade of experience being very successful. He's a founder of a company called Raymond Property Management, which is now part of Mynd. Very exciting. So today we get to poke Scott's brain and see if we can get some wisdom nuggets falling out. And we've done a number of episodes already. You would see those at Mynd.co. Search for Sacramento Investing. But today—right now—today's topic is: what do property management companies do? Specifically, in Sacramento—what's the scope of services? What do they do?Scott Raymond: That's a good question. You would think it would be an easy answer, but there's really a variety of different ways property management companies approach services. The entire property management service continuum, as I like to call it, includes everything from getting the vacant units ready to rent, marketing the vacant units, screening and choosing tenant applicants, collecting rents, obviously, paying bills, preparing audit reports and bookkeeping, handling maintenance issues and emergencies, interfacing with tenants and whatever they need, and then being responsive owners' needs, and then also managing the group of vendors that are required to work on these properties.Some companies will only do leasing, for example, or only offer a portion of these services. For example, doing leasing only. Some will collect rents but not pay bills. Or they'll charge you extra to pay bills, but they don't handle maintenance, for example, or preparing units for rent. Other companies offer the entirety of services. They're called full-service companies, and they—soup to nuts, from beginning to end, from getting the unit ready, to leasing it, to collecting the rents, to paying the bills, to sending the reports, and everything in between. It's really a variety of services, from lease up only to full service, Alex.Alex: As an investor yourself, how would you go about choosing one, and why would somebody just do a lease-only, and does their incentive align with the investor more or less than a full-service property management company? Give us a little bit more color on going and choosing one for yourself.Scott Raymond: No, I don't think there's a misalignment in services. I mean, a company that only does lease-only is going to have the same energy and incentive to lease up that property as a company that does full-service, which includes leasing the property. So those interests are aligned with the management company's standpoint. But, why would an owner hire somebody for leasing only? Well, maybe the property's next door to the one they live in or right down the street, and so it's easy for them to look after it. It's easy for them to collect their rents. It's easy for them to fix a broken appliance or something. But they realize that they don't have the technological prowess that a property management company would to do solid online marketing and showing and screening and all the fair housing compliance that goes with it.So it does make sense for some investors to hire a company that just does lease only because they'll do a better job, a quicker job, and get higher rents than somebody who’s self-managing. But they don't need all the other bells and whistles of a full-service property management for a variety of reasons.Alex: Got you. Very good. Thank you for giving us some color on the subject. Boys and girls, thank you for watching. As I said, go to Mynd.co and see if you're interested in Sacramento as an opportunity to invest in or if you want to potentially look into a property management service in Sacramento. Check us out, Mynd.co. Scott, thank you for your time.Scott Raymond: Thanks, Alex.Alex: Thanks for watching.The types of services property managers provide are as diverse as the needs of investors. From preparing and marketing a property to screening potential tenants, the expertise and infrastructure they provide can turn a vacant property into a profitable rental. And from bookkeeping to maintenance services, a good property management company can easily meet the challenges, responsibilities and specific needs of any real estate investor.

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What Does Property Management Cost

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As a real estate investor, hiring a property manager can be one of the best decisions you make. Today, we’re speaking with Scott Raymond—founder of Raymond Property Management, now part of Mynd—about the sorts of expenses or fees an investor must account for when deciding upon the right company to manage their property or properties.Alex Osenenko: Boys and girls, Alex with Mynd Property Management. Today we are talking about investing in Sacramento and how to be successful in doing so. Specifically, Sacramento real estate. I have a guest to help me unpack this vast topic and his name is Scott Raymond. Scott, how are you?Scott Raymond: Hey Alex. Doing great. Thanks for having me.Alex Osenenko: Yeah, we're lucky to have you, man. Ten years of successfully investing in Sacramento area. Founder of a company called Raymond Property Management, which is now part of Mynd. And today, Scott and I are—well mostly Scott—is going to unpack the question: what does property management in Sacramento cost?Scott Raymond: Yeah, this is a good one. Obviously a topic near and dear to many investors looking for property management companies in Sacramento. So basically property management companies in Sacramento generally either charge on a percentage of rent collected each month, like five percent and up to as high as eight or nine percent, or a flat fee per month. So typical management fees would range from say $75 per month to as high as $150 or $175 per month. If you had say ten units, and the rate was $100 () per month, you would expect to pay somewhere around $1000 per month for that property.The next typical leasing property management fee that's charged in Sacramento is leasing fees. These are essentially commissions that the property management company charges to lease up a unit. And they also can either be a flat fee of say like $250 or $300 for each new lease or they could be a percentage of the actual rent or the first month's rent. Many companies charge anywhere from 25% to 50% of the first month's rent. So, for example, if the property management company leased a unit for $1000 and the rent was $1000 per month, the cost for that lease up would be somewhere between $250 to $500.For companies that basically have their own in-house maintenance staff in Sacramento—they generally bill them out at hourly rates of between $55 per hour up to as high as $95 per hour.Other types of costs for property management companies in Sacramento include markups on vendors like HVAC and plumbers and electricians, administrative fees for posting notices, collecting utility reimbursements and those sorts of things.So one thing that's really important to keep in mind in closing is the lower the base fee from the property management company, the more likely there will be a bunch of other different fees that they charge you for throughout the process, while some companies in Sacramento offer an all-inclusive price. So, it's really up to you to kind of vet those out and see which one's right for you.Alex Osenenko: Excellent. That's good. Lots of wisdom here, Scott. Thank you very much for sharing.Thank you for watching to our viewers. If you find this on YouTube or other video sites, go to mind.comynd.co and you'll find a number of episodes that Scott and I have done on and around investing in Sacramento.Scott, thanks a lot for your time.Scott Raymond: Thanks, Alex.Alex Osenenko: And thank you for watching.A property management company can provide investors with the infrastructure and expertise to save them time and money. But this can come at an expense. Whether they are providing in-house maintenance or supervising the leasing process, it is imperative to know not only what types of services your property manager provides, but what these services will cost. As hiring a property manager can mean the difference between staying afloat and creating a profit, an understanding of these fees is crucial in making your investment a long-term success.

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Five Reasons Why Investors are Successful in Sacramento

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For almost a decade, has topped the national market in year-to-year rent growth. With the right knowledge and decisions, this can translate to serious money for real estate investors. Our guest today is Scott Raymond—founder of Raymond Property Management, now part of Mynd. Scott is here to share his top five ways investors have found success, especially in such a competitive rental market.Alex Osenenko: Boys and girls, today we're talking about investing in and how to be successful in doing so. My name is Alex. I'm with Mynd Property Management and my guest today is Scott Raymond. Scott, how are you?Scott Raymond: I'm doing great, Alex. Thanks.Alex Osenenko: Guys, it's a treat to have Scott on this cast. With over a decade of experience, he’s a very successful investor in and, I should mention, the author of an upcoming book. We'll tease that out. Look him up later when he's done with his writing—that should be a Bible for real estate investors. He is a founder of Raymond Property Management, which is now part of Mynd; so, very exciting. Today's topic, we're going to cover five reasons why investors are successful in . Scott, what are your top five?Scott Raymond: Alex, yeah, great topic. So my top five starts with number one: they understand the market. And what I mean by that is, they understand the price of purchasing a property—a condo, a single-family or an apartment building—relative to the rents they can receive on that building. This basically keeps them from overpaying for a property where the rents don't generate a sufficient return. Say, for example, you bought a condo in Midtown for $400,000, you put 20% down and your mortgage rate was 5%. And let's say you were expecting a 5% return on your investment. The condo would have to generate approximately $3,500 in rent per month assuming expenses—typical expenses of, say, 40% on top of your mortgage. Now, if you didn't understand the market and you bought that condo without understanding rents—you only ended up getting $2,500, for example, for that same condo—you're going to end up paying out of pocket each month. Your return is going to be negative and you're going to be feeding the property. So, understanding the price of rental units that you're purchasing relative to the rent you can get from them is critical.Number two is to keep expenses low. The big killer of return for investors is really the cost to fix things that inevitably break, or updating things that are past their useful life like roofs, appliances and water heaters. And then also the cost of getting the unit ready for the next tenant after the prior tenant moves out.Number three: they keep the properties full. I can't stress this enough. One of the costliest and most damaging aspects to an investor's return is a vacant property that's sitting there waiting to either be re-rented or fixed up. So, for every day or week or month that a property sits vacant, think about it; that's lost income—income that can't be used to pay the mortgage or taxes or ongoing expenses.Alex Osenenko: And it's lost forever, right? You're never going to recover that.Scott Raymond: You can't get it back. So many owners we run into find themselves with an extended vacancy for a variety of reasons, including that they don't have a reliable maintenance person or contractor to help them get the unit ready. And so, weeks and weeks go by while they’re waiting for a painter to get out there and paint the property. Or they don't have effective marketing tools to reach the broadest market for prospective tenants. Or the price of the unit too high because they don't understand the market and tenants aren't responding to it. Or they tried to show the units themselves because they don't have a property manager and they keep missing showing appointment opportunities with prospective tenants because their schedule just doesn't match up.Number four, they keep up with rising rental rates under the lease renewals and new leases. has averaged 5-8% year over year rent growth for the past eight years. This is phenomenal growth and () has led the nation in rent growth. And so, if investors aren't on top of it, they find themselves well below the market. So really keeping up with rising rental rates.And then, frankly, if they hire a professional property manager versus self-managing. Unless they're a full-time investor—which I happened to be when I was investing in —with the time to essentially look after the property on a day to day basis and show vacant units—if they don't have the time to do that, they really should consider hiring a professional property manager and just factor in the cost—the very reasonable cost of what a management company costs relative to the overall investment expenses.Alex Osenenko: Yeah. Very good. There are your top five reasons. And if you have any questions, go on mynd.co. We have a number of casts, these sort of short investor education episodes with Scott. Check them out. Scott, thank you very much for your time.Scott Raymond: Thanks Alex.Alex Osenenko: And thank you for watching.Every dollar counts, especially when entering ’s increasingly competitive rental market. Having the right knowledge and making the right decisions is essential to saving money and getting a return on your investment. Whether it’s choosing the right property to buy or setting rental rates, successful investors secure their investments by knowing the right decisions to make.For many, this means turning to an expert with an understanding of—and experience in—such a competitive market. By applying their expertise, property managers can help investors keep expenses low and properties full, giving them the knowledge and infrastructure to save money and make a profit.

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How to Handle Emergency Maintenance

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Maintenance emergencies are always a possibility, especially when renting a property. As such, having a team of experts and vendors to rely upon can mean the difference between fixing the problem now and fixing the problem in the morning. Scott Raymond is the founder of Raymond Property Management—now part of Mynd—and today he is here to discuss how to tackle such emergencies when they do occur and how some emergencies might be avoided, altogether.Alex: Boys and girls, Alex here with Mynd Property Management. Today we're talking all about investing in the Sacramento area. My guest today is Scott Raymond. Scott, how are you?Scott Raymond: Doing great, Alex.Alex: Great. Scott has a decade of experience investing in Sacramento, specifically. He's very successful in doing so. He founded his own property management company, Raymond Property Management, which is now part of Mynd, so very excited about that. The topic we want to cover today is what to do or how to handle an emergency maintenance situation with your rental.Scott Raymond: That's a good one, Alex. Most non-life threatening maintenance emergencies really have to do with plumbing or the HVAC system not working in extreme weather. Plumbing issues would be like a water leak or a sewer backup. An HVAC failure would be, the air conditioning's not working and it's 110 degrees outside or the heater's not working and it's freezing outside.So if you're self-managing, you need to have a reliable, stable group of vendors that you can call on—that will be there when you need them, like in the middle of the night or holidays, and won't completely price gauge you.Otherwise, my suggestion is to hire a property management company that has a dedicated staff of maintenance techs and vendors that can handle any problem, pretty much at any time.Alex: Yeah. So, we've done a similar interview with Enrique Jevons in Seattle. His sort of advice was—I think very similar to yours, but he was more specific into building a team—you have to have a team in place before you need them.Scott Raymond: Absolutely.Alex: Do you have any tips on how to build a team as an investor? I mean, I understand hiring a property manager gives you access to those teams, but folks who are not currently involved with property management companies, how would they go about building a team?Scott Raymond: I’ve got to tell you; the bad news is it's very tough. You know, if I'm a real estate investor and I have one rental house, I'm not going to get on anybody's radar, I'm not going to be considered a top client or top person for a plumber or an HVAC vendor or electrician to call.When I call them, I'm just going to be like any other customer. So it's really, unfortunately not until you get some real scale, three, four or five properties where you can give these people consistent work. When you start to give these vendors consistent work, that's when they put you on their team, you put them on your team and that's how that really works. But other than that, you're just another client calling off of Google to the local plumber trying to get a priority fix on an emergency issue.Alex: There you go. Get big or hire a property manager or be smart and do both. That's the advice. Thanks for your time today, Scott.Scott Raymond: Thanks, Alex.Alex: And all of you watching, thank you for watching. Go to mynd.co to find a number of other interviews Scott and I have done on investing in Sacramento. Until then, much love.Maintenance emergencies are bound to occur when owning a rental property. So, having the right team of vendors is the best way to tackle any emergency you may encounter. Building relationships with reliable experts and vendors can be quite difficult, however, especially for new investors or those with relatively few properties.Having an infrastructure in place before you start renting is imperative. By hiring a property manager, you gain a devoted team of vendors to handle whatever emergency may arise. And while self-managing is a viable option for many investors, the scale and expertise of a property management company can save you time and money by providing dedicated experts to fix any problems before they become worse.

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Do You Really Need a Property Manager in Sacramento?

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With one of the hottest rental markets in the country, Sacramento is growing more competitive by the day. Today, we’re speaking with Scott Raymond—founder of Raymond Property Management, which is now part of Mynd—about what makes Sacramento’s rental market so competitive and why having a property manager is key now more than ever.Alex: Hey boys and girls. Alex here with Mynd Property Management. Today we are talking about investing in real estate in Sacramento and how not to lose your butt, so to speak. My guest today is Scott Raymond. Scott, how are you?Scott: I'm doing great. Thanks, Alex.Alex: Scott has over a decade of experience investing in Sacramento. He's a founder of Raymond Property Management, which is now part of Mynd. Scott—the question we're going to tackle today is, do you really need a property manager in Sacramento?Scott: Yeah, I think that's always been the case, Alex, but now more than ever for a variety of reasons. Probably first and foremost, within the last couple of weeks—we're in early September right now—the city of Sacramento just adopted rent control. What this does is, it imposes rental caps—how much you can increase rents on your properties—and then also imposes very specific rules and restrictions on how you move tenants out. So, not understanding these restrictions and regulations could prove very costly for an investor.Secondly, Sacramento remains one of the hottest rental markets in the country. So, having a management partner that really understands market rents and how to get there is pretty important. You know, next, getting units filled quickly is another key to success of any rental property. So, having a management partner that's really an expert in marketing to and locating tenants is going to be vital.Then you've got the costs of supplies, materials, and labor that have all increased as a result of tariffs and other factors—just a good economy. These can be very important aspects of keeping expenses low on properties. So, having a property manager that has economies to scale, that has a labor pool that they can rely on and groups of vendors that they get pricing breaks from can be very critical. And then not to mention, just the real inherent value of having a property manager. What I call the sleep-at-night factor. The property manager insulates you from all kinds of liability, tenant complaints, and hassles, to make sure your code compliant with fair housing, keeps your phone from ringing in the middle of the night with leaky water heaters and these sorts of things. So, I think now more than ever property management is key.Alex: Man, those are solid reasons. I've attended one of your seminars when you spoke about the viability of investing in Sacramento area. Can you drop just a couple of knowledge nuggets into why Sacramento is still red hot for investors?Scott: Yeah, Sacramento is red hot because, for the last literally eight years, Sacramento has topped the national real estate market in terms of year over year rent growth. This was a function of a couple of things. Sacramento has always been the little brother of the Bay Area. The Bay Area always got the jobs, always got the population migration and so forth. And Sacramento, even though it's only an hour's drive—maybe an hour and a half of traffic—and even though it is the state capitol, has universities and its close proximity to Tahoe and other great lifestyle type things, it was always kind of a second tier market to the Bay Area.Well now that what's happening is, with the Bay Area’s cost of housing getting so astronomical, people are looking to other areas. They're looking to Oregon. They're looking to Washington. They're looking to Arizona and Nevada, and then they realize Sacramento is just an hour drive away. I could still be close to my family and my friends that I went to college with or whatever. And so, Sacramento has benefited and will continue to benefit from those trends. And the fact that Sacramento developers, in Sacramento, have not built a lot of new properties or new units, you've got a pretty stagnant set of available properties for a lot of people that want them. I think that bodes pretty well for Sacramento.Alex: Wow. Very, very, cool round up. Well, Scott and I will be doing a few more episodes on investing in Sacramento. Check them out at mynd.co. Scott, thanks a lot and hopefully we helped you out today.Scott: Thanks, Alex.Between new regulations and increased competition, property managers are a must when thinking of entering Sacramento’s rental market. With resources and knowledge to successfully market and manage your rentals, a good property manager can insulate you from those factors that would otherwise keep you up at night, all while saving you time and money. Whether navigating new regulations, securing price breaks from vendors, or simply keeping your phone from ringing in the middle of the night, having a property manager is critical to successfully navigating Sacramento’s increasingly competitive rental market now and in the years to come.

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