Rental Market Update
With the shifting economy due to Fed interest rate hikes and other factors the rental market is changing in Austin, and across the country in both the single family and multi family markets. With some reporting indicating Austin is being hit harder than other markets there are things to take into consideration now with renewal and new lease rent rates. The increases in rent seem to be tempering and should be considered when the time comes because it’s better to have a tenant than to force a turnover by increasing the renewal too much, or by listing a property for lease at a rate that is too high. There are a lot of articles being published about the shift in the rental market, so instead of linking them we will just recommend doing some quick research if you want.
Some factors that are impacting the market are:
Seasonal variation- the late fall and early in the new year are typically a slower time overall in real estate
Increased rental inventory- due to the slow down in the sales market many property owners are shifting to renting their homes when they don’t sell. This competition for tenants will lead to lower, stagnating, or slower increases in rent rates
Tech Industry Layoffs- Many tech firms are implementing hiring freezes and layoffs as the economy shifts after many years of unprecedented growth. While the numbers aren’t astronomical it does impact us due to the number of firms that have set up shop in Austin.
Reduced Demand- With the factors above in mind there are certainly renters who are choosing other markets because of the increasing cost of living in Austin with rent rates as high as they are at this time. Rent rates have gone up everywhere, but the speed at which they are going up as well as the possibly lower starting point will make other markets more attractive if it is an option for potential tenants.
Ultimately, we want to minimize vacancies for our clients. When it comes to renewals we want to keep the tenant in the home as long as possible, which may require a smaller increase than previous years or possibly no increase at all.
Leasing a vacant property needs to be much more competitive than before given the factors above and potential tenants having more choices and potentially more negotiating power.
1099 Season is upon us
In the coming weeks you’ll receive an email with the subject “Stone Oak 1099 Address Verification and E-Delivery Notice.” Generally, we want to confirm the address we have on file for the tax forms, and encourage all clients to consider allowing electronic delivery of the forms. This is a much more secure method of sending these forms with sensitive data on them, and every year we see a handful that get lost in the mail.
Maintenance Approval Process Changes
In addition to the info below about funding repairs we want to notify all owners that we are modifying our escalation process when we can’t reach our clients in order to make sure we are complying with property code requirements. In bonafide emergencies we are acting within our authority to mitigate damages, however after it has been contained or in non-emergency situations we reach out to our clients for work authorization that is required above the limit set in the management agreement. In those cases we now have a strict process going into effect that will have a time based escalation if we cannot reach you. The time frame will be that if we can’t reach you by the 3rd day from when we first reached out we will then reach out to your emergency contact who can aid us in getting authorization or contacting you. If you’d like to update your emergency contact we have on file please contact your property manager. Keep in mind that this contact should be someone outside of your immediate household who you trust to make decisions on your behalf if you cannot be reached by them or us.
Office Hours for the Holidays:
December 26th, 2022 we will be closed for the holiday
January 2, 2023 we will be closed for the holiday
Reminders:
We have moved offices! Our new address is:
14050 Summit Drive ste 113B
Austin, Texas 78728
Details of the new location can be found here.
Funding Make-Readies & Maintenance for Your Property
Please note that it is Stone Oak's policy that the owner has reserve funding on hand with Stone Oak to help us commence work faster when it comes to make-readies and maintenance on your property. Stone Oak cannot perform maintenance without first receiving authorization and funding, which can slow down the turn-around times on our vendors and their availability in this market. This can also potentially create a negative experience that tenants will remember when it comes time to renew, and we always want to avoid turning over the tenants. Any time we request authorization for work on your property, the best practice is to immediately fund your account when you provide written authorization to move forward. This is as simple as going into your owner portal and using ACH for a free transfer, or if you prefer a credit card the processor charges a fee as part of the transaction.
Keep in mind that tenant charges on your account are not considered an offset to this amount as we keep a strict accounting system for both our and our client's benefits. Any tenant chargeable items will be posted to their account, and once they are paid it is immediately credited to your account. If you have any questions about this reserve amount held with Stone Oak please contact your property manager.
Happy Holidays and Happy New Year from everyone at Stone Oak! We look forward to another great year working together in 2023. Please don't hesitate to contact our team if you need anything.
