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My blog two weeks ago refers to some basic upgrades that help both current and future investors in the Las Vegas rental home market. I would like to add to this every few weeks so that the information I provide may help you understand other points of consideration when analyzing your current and future rental home purchases.
Homeowner associations? Do you buy in one, or avoid them? The Las Vegas real estate market has roughly 70% of homes in active homeowner associations. Many institutional investors purchased homes outside of associations simply do on their 30 year analysis of that monthly cost. I have seen firsthand the aftermath of these communities. In lower end neighborhoods, the homes tend to become "Sanford and Sons" properties. They simply become a junkyard, amassed with various items sitting in plain view for all to see.
Having a homeowner association in place helps keep the exterior of your property in check. But this goes with a cost, not only the monthly dues, but more important are the "monthly" violation letters you receive. A property owner needs to avoid dealing with these letters and understand they will come and come often. This does not mean your resident or property manager is a knucklehead, but simply being analyzed by the full-time property inspectors that the association employ. Their sole job is to inform you of any exterior issues that may arise. The most common violations are garbage cans not put away at the end of garbage day, oil stains on the driveway, landscaping issues, and exterior paint defects or corrosion.
These notices are standard and the law allows 30+ days to remedy these violations. So don't be upset when the violations come in, many times these are simply the beginning stages of a problem and can ultimately help with addressing something before they get worse. However, a new investor should consider this and the minor cost that comes with it. But being hostile with your property manager and assuming that they are not doing their job, will only lead to a property manager terminating his management agreement and putting you the property owner in the driver seat. Which ultimately is a headache and most homeowners don't know the laws or time frames to remedy and communicate with the associations. My office has one full-time person dealing with these associations and ultimately these problems are resolved, even the ugly ones.
