Ski season is right around the corner and rental properties are already being booked for the 2014/2015 ski season.  Make sure your property is in tip top shape to ensure the best revenue.  Check out these great tips…

Be street legal.

First, look in to local laws and HOA restrictions so that you can be sure to conduct business legally. You may find that you need to obtain a license or permit before renting out your home. You may also find that your area specifies a minimum night stay for short term rentals. Additionally, I recommend consulting with a tax professional to make sure you know how to report your income and what you will need to set aside for taxes.

Ensure you’re insured.

Next, make sure that your insurance policy allows renting and will cover damages. You can require renters to purchase $1000, $3000 or $5000 worth of damage protection, for which they only pay a small fee. You may also want to consider additional medical liability insurance to protect yourself in the event that someone gets hurt on your property.

Make your property enticing

When someone is going on vacation, they want to stay in a clean, comfortable place.  I suggest getting a professional deep clean at the beginning of every rental season.  You may also want to look into getting the carpets cleaned and putting a new coat of paint on the walls.  Adding new, more modern furnishings will go a long way to attract potential renters.  Consider updating one piece a year to make the property feel fresh.  This may include your technology, such as replacing an old box television with a new flat screen.  Make sure to remove all clutter and anything breakable, families don’t want to have to worry about their child breaking something.  Also, updating the bedding and towels every year will keep your guests more comfortable.  Don’t forget, the small touches like nice soap or shampoo will make an impact on your guests when they come to stay.

If you market it, they will come.

I suggest hiring a professional photographer to stage and shoot your home. Take new pictures each year after a fresh cleaning to keep your property looking new and inviting.  You should also write a short description of the property including all of the amenities that it offers.  Even though your guests are not buying your home, they often look  for the same upgrades they would when making a purchase so highlight those in your description.  Location, Location, Location – your guests want to be in the best possible place for what they are looking to do so make sure to highlight surrounding attractions. Providing maps and activity guides to all your guests will make their trip easier and stress free.  They will be more likely to come back and stay with you again.

Outsource when necessary

If you do not live close to your rental, you may want to consider hiring a property manager to handle business for you. Property managers can help with marketing, screening tenants, handling contracts and deposits, maintenance, repairs and cleaning. This typically costs 20-40% of what you make from renting, but can be invaluable for far-away owners.  When the management company is in charge of the cleaning, ask to view other units in the rental program before making a decision.  Remember, guests are most impressed by cleanliness so this can be one of the most important things to evaluate.

Check out Land Title Guarantee Company June market analysis.  Below if a synopsis but click this link for the full report as well as informational graphs.  Land Title Guarantee Company June 2014 Market Analysis

June 2014 Highlights:

• Market Analysis by Area for June: June was the second best month of 2014!  There were 148 transactions with $62,036,850 in gross monetary volume. The average transaction price for all 18 reported areas at $414,814, average residential price was $436,991 and the median residential price was $415,000. The average residential PPSF was $295.
• YTD Transaction Summary: There have been a total of 743 transactions with $366,456,756 monetary volume, the average transaction price for all 18 reported areas is $493,166. The average residential price is $510,313. The median residential price is $405,000. The average PPSF is $316. Breckenridge ( between Blue River and Farmer’s Corner) holds 48% of the $ volume in Summit County.
• Market Snapshot for YTD 2014 vs. 2013:  Values are as follows: Average Indicators for $: Single Family +8%, Multi- Family +6% and Vacant Land +10%. Median indicators for $: Single Family +7%, Multi- Family  +5% and Vacant Land +49%.  These indicators translate into the stabilizing pricing in Summit County for 2014.
• Market Analysis % Change showing years 2004-2014 YTD:  June monetary volume ($62,036,850) is up 1% from June 2013, transaction volume (148) is up 6% from June 2013.  2014 YTD (6 months) monetary volume is still up 6% from YTD 2013. YTD 2014 transaction volume is still down by only -1% down from YTD 2013.  Inventory continues to be low in Summit County compared to years past.
• Residential Market Sales by Price Point : Residential volume in June had 119 transactions with $52,001,950 gross volume.  There were only 6 properties that sold for $1M and above in June.  The most active price point in June hovered between $200K to $300K. However, the price point of $500K to $600K was much higher than months past with 24 transactions in that price range. There were 40 Single family, 79 Multi-family and 14 Vacant land transactions in June.
• 2014 Average Price History: Average residential pricing continues to be highly consistent as of June – Single family is $808,086, Multi- family is at $363,564 and Vacant land is $357,573. This graph ( page 7) is a great piece to show your clients that our market has held it’s value over all these years.
• Historical Cost Breakdown YTD 2014 : There have been 624 residential transactions YTD 2014 and $318,435,356 gross volume with 53 properties $1M – Compared to 2013 YTD, there were 601 transactions and $304,101,400 gross volume, 51 properties at $1M and over and in 2012 YTD, there were 490 transactions with $252,960,700 gross volume, 37 properties at $1M and over.
• Top Lender Graph: There were 326 loans in June, 87 loans were related to sales at 59% of the 148 sales transactions and 41% of the sales were cash at closing. There were 117 REFI’s and 122 loans related to Timeshares.
• Market Highlights: Please see page 10 of the Market Analysis-View the higher priced purchases in June with no bank sales.
• Foreclosures:  There were 17 Foreclosure actions in June 2014 ( mainly from timeshares) compared to 20 in June 2013.
• Land Title Purchaser Highlights ( Page 15):  There were 6 higher end sales in June to note- you can see the details on this report.  In June, the majority of our buyers for real estate transactions continue to be the Front Range demographic at 42% of our market, only 23% are local and 34% are out of state buyers.

Check out this great article about where to spend your warm summer afternoons in Breckenridge having a cocktail or beer

Check out this helpful article curtosey of Land Title: Topic of the Month

Tips for a Smooth Closing

All parties involved in a real estate transaction want to experience the smoothest closing possible. Communication is key. Some helpful tips are featured below that will assist in creating a positive experience in the closing for your Sellers and Buyers.

Providing Information to the Title Company
A great way to capture all of the information needed by your closer is to use a Closing Control Sheet. Utilize this to fill in commissions and other pertinent information needed. This will prevent numerous phone calls and emails being sent to request this information. If your office doesn’t supply one, a Land Title sales representative would be happy to provide you one with a blank form if requested.

• It is imperative that along with a fully signed contract that the closer receives e-mail addresses, physical addresses and phone numbers for the Buyers and Sellers. The new lender information is also needed so that their is immediate access to the fees for the preparation of the Good Faith Estimate for the buyers. Please note that the information you provide is not shared.
• It is extremely important that any contract amend/extends are sent to your closer as soon as possible. Any change to buyer(s) names, additional credits from seller to buyer, or any change of closing date, etc. affects your closing.
• The closer will also need information on any current loans on the property. The closer can contact your seller directly- please notify your seller that the closer will be contacting them for their loan numbers and social security number, which is required by most lenders when ordering the payoff statement. Many lenders also require a written authorization from the seller to release a payoff statement.
• If you would like the closer to order the Association documents, please notify the closer immediately so that the contract deadline can be met. Land Title staff can also order these documents for you when Land Title is not the closing agent on the transaction. Contact a Land Title sale representative or closer for the applicable fees. Please Note: Not all offices outside of the Metro area can provide this service.
• Will all the parties be able to attend the closing? Will a Power of Attorney need to be prepared or is a mail out of the closing documents required? If a buyer cannot attend the closing, the new lender must either approve the use of Power of Attorney or approve mailing out their documents for signing. Also, if the party is out of the country, they will need to arrange for the acknowledgment of their documents, which will then need to be authenticated by a document called an Apostille.
• Notify the closer if your seller has an out-of-state address and the property being sold is an investment property or second home. They could be subject to a 2% State of Colorado withholding. Also, inform the closer if the seller is a foreign individual or entity without a taxpayer ID.
• If your seller has owned their property for more than 10 years and is older than 65 years of age, check with them to see if they have applied for the Senior Tax Exemption on their property taxes with the county assessor.

Scheduling the Closing

• Because of the high volume of closings at the end of the month and on every Friday, you may have more options and have a more enjoyable closing if you choose to close mid-month or mid-week.

What to Bring to the Closing

• All buyers and sellers must bring a valid driver’s license or picture ID issued by the state, or a valid passport. If there has been a change to marital status that is not reflected on the ID, then the party must provide a marriage license or divorce decree as documentation.
• Any funds due at closing must be brought in the form of “good funds” as required by Colorado law. Good funds can be a cashier’s check or wired funds. Money orders, ACH payment systems and Western Union transfers are not considered good funds.
• Seller’s Social Security numbers or Taxpayer ID’s will be needed.

Funding the Closing

• All original documents must be received from all parties prior to disbursement of funds. This includes Powers of Attorney and any documents mailed to the parties for signature. An email copy of these documents is not sufficient for funding.
• Your closer must be in receipt of all funds due at the time of closing. In most instances, the new mortgage lender now requires the closer to email some of the signed documents for their review. They will then give the closer authorization to “fund” the closing by providing them with a funding number. Until the closer receives this number from the new lender, they are not authorized to disburse any funds in the transaction.
• If your seller pre-signs their documents prior to the buyers, inform them that any proceeds being wired to them might not be sent the next business day. The wire cut-off time for the bank Land Title utilizes is 2 pm.
• If unable to fund a transaction at the time of closing, the closer will have an “Extension of Escrow” signed by all parties. As an agent, you are also required to obtain an Amend/Extend signed by all parties.
• When your seller is an entity such as a Trust, LLC, Corporation, etc., the closing agent is required to have the proceeds payable to the entity. For example, we cannot have the proceeds payable to the “trustees”, they must be payable to the actual trust. We have found that many entities, such as a trust or an LLC, do not currently have a bank account under that name. Most likely their bank will not accept a deposit of the seller proceeds into an account held by a different name. So your sellers will need to provide their trust documents or operating agreement to the bank to open an account prior to closing. It is advisable for the seller to contact their bank for its individual requirements.

Disclaimer: This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is distributed with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal or accounting advice or other expert assistance is required, the services of a competent professional should be sought.
© Copyright, 2014, by Land Title Guarantee Company

The Dillon Arts Festival will be going on this weekend on Main Street.  July 18th ( 9 am to 6 pm), July 19th (10 am to 6 pm), and July 20th (11 am to 5 pm)

Don’t forget to also stop by the Dillon Farmers Market for fresh produce and other local goodies.  Buffalo Street and Main Street in downtown Dillon.  They also have live music from 10:30am-1:00pm.

They also have concerts most Friday and Saturday nights throughout the summer at the Amphitheater on Lake Dillon.  The concerts start at 7:00pm.  Bring a blank and enjoy the live music!

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