Owner FAQs

Just give us a call at 650-867-1150, or send our Business Development Manager an email at BDM@gofivestarpm.com.

Is your property management company really doing all that you need them to do? It can be hard to tell if you are new to professional property management, or haven’t had the chance to investigate what different management companies provide. The California Department of Real Estate – the state government agency tasked with licensing and regulating real estate brokers, agents, and companies – offers the following list of specific duties a property manager must perform:

• Establish the rental schedule that will bring the highest yield consistent with good economics.
• Merchandise the space and collect the rent.
• Create and supervise maintenance schedules and repairs.
• If applicable, insure independent contractor license status and insurance coverage.
• Set up payroll system for all employees.
• Develop a tenant/resident relations policy.
• Supervise employees and develop employee policies, including an Injury Prevention Plan.
• Maintain proper records and make regular reports to the owner.
• Qualify and investigate a prospective tenant’s credit.
• Prepare and execute leases.
• Obtain decorating specifications and secure estimates.
• Hire, instruct, and maintain satisfactory personnel to staff the building(s).
• Audit and pay bills.
• Advertise and publicize vacancies through selected media and broker lists.
• Recommend alterations and modernization as the market dictates.
• Inspect vacant space frequently.
• Keep abreast of the times and competitive market conditions.
• Obtain and pay insurance premiums and taxes.
• Be knowledgeable about and comply with applicable Federal, State and local laws.

A Homeowners’ Association (HOA) is a legal entity charged with the marketing and managing of single family homes, condominiums, or lots in a residential subdivision. Typically, buyers of residences in such a subdivision must join the HOA as a condition of purchase.

Once you decide to change from your current property management company to Five Star Property Management, the process is actually very simple. Just call your existing property management company and let them know that you no longer wish to do business with them. At this time you will also need to request that your existing property management company send you all keys to the property, as well as any maintenance reserves or security deposit funds. That’s all there is to it.

After you contact Five Star to request property management services, one of the Five Star Property Management will personally visit your property to assess the condition of the unit(s), meet any existing tenants and make note of any other items that may affect our decision to accept the management of your property. Ideally, you, as the owner, will accompany us on this site visit so that you are able to immediately point out any additional information about the property that might present an issue now or in the future. The great part about a personal site visit is that we have the opportunity to point out simple improvements that can dramatically increase the rental price of your property!

Trust

For most people a rental property is their single largest asset and represents a potential source of college funding for children or a safe and secure income stream in retirement. Why anyone would leave the management of this asset to someone they didn’t implicitly trust is simply beyond our comprehension.

Vision and Values

Again, for most people a rental property represents their single largest asset. As a rental property owner, you should look for someone who shares your vision for your property, be it to keep rents as high as possible, reduce turn over, make capital improvements that will lead to even higher rental income, or even focusing on the acquisition of additional rental properties. Regardless of your goals, you should look for a property manager who shares your vision and values, and will work diligently every month to earn their fee by staying on top of any maintenance, tenant, safety or other issues which may arise, while still holding on to and working to meet your broader vision for your property.

“One Stop” Service

Part of the reason for hiring a professional property management company is to reduce your time and stress. So, don’t settle for a management company that can only do part of the job. You’ll just find yourself running around managing your management company. Many of our property owners live overseas and rely upon us to handle all of their rental/ investment property needs, be it something simple like finding a new gardener, to something more complex like roof replacement or kitchen/ bathroom renovations. Thanks to our experience and expertise, you can rely on Five Star Property Management to handle all of your wants and needs.

Knowledge of and compliance with local, city, state, and federal housing laws.

Far too often we have heard horror stories of rental property owners who were faced with double or triple-digit dollar amount lawsuits because they relied on the advice of a property manager who did not understand (or worse yet, chose to ignore!) the many varied and complex rules and regulations which surround the managing rental property.

Simple things are important. For example, an annual inspection should be performed by your property management company in order to catch little issues before they turn into big issues. Additionally, care should be taken that all tenant security deposits and all client funds are dealt with in a proper and legal manner, such as the paying of interest on tenant security deposits in San Francisco, and ensuring that all client funds are maintained in properly protected and titled trust accounts.

Reliability

Property owners need to know that they can rely on their property management company to always look out for their best interest. Property owners should also know that any requests or questions they may have are promptly and honestly answered. Lastly, property owners should know that their property manager is always available, 24/7, 365 days a year.

It can be tempting to attempt to manage your own investment properties. After all, who knows better your goals and ambitions for your property than you? But, professional property management has many benefits that you may not yet even realize. Professional property managers are experts in seeking out and creating efficiencies that ultimately save you money while increasing the value of your investment property. Property managers are also licensed professionals who have formal training in the legal and financial intricacies of dealing with tenants, lease agreements, security deposits and financial reporting. Finally, using a property manager means that you don’t need to spend your time collecting rent, finding new tenants or responding to maintenance requests.

AB1482 was introduced by Assemblyman David Chiu (D-San Francisco) and signed into law by Governor Gavin Newsom and has put two notable statewide tenant protections in place. First, AB1482 has extend just cause eviction protections to tenants living in residential properties not currently covered by just cause eviction laws; and second, AB1482 prohibits owners from increasing rent by more than 5%, plus the rate of inflation, or 10% (whichever is less) more than once per 12-month period for tenants who have occupied the same unit for more than 12 months. Many property owners will now be responsible for assisting vacating tenants with relocation payments of up to (1) one full month’s rent. However, there are many exemptions to AB1482, but you MUST ACT and notify your tenants if your property is found to be exempt. Failure to do so could end up costing you large amounts of time, money and stress!

If you are a “do it yourself” type of person, have a high-risk tolerance and don’t mind getting your hands dirty or answering emergency maintenance phone calls at 3am, the LEASING ONLY PACKAGE maybe right for you! The LEASING ONLY PACKAGE offers you the advantage of professional tenant placement and screening with the most up to date and landlord friendly lease available in your area at a cost that is easy to live with.

However, if you are like most people, you would likely prefer to let our experienced team of professionals handle all of the dirty work so that you can have complete peace of mind with our all-inclusive services such as no charge tenant placement, video and written move in/move out inspection reports, no charge annual property review, 24/7 emergency maintenance response and eviction protection of up to $2,500.00. If this sounds like you, then the TOTAL CARE PACKAGE is the right one for you!

“On-Demand” showing technology allows interested parties to view the unit at pre-set times after passing a security and identification verification procedure. This works best for properties in high traffic areas.

The lease commission covers all services and costs related to marketing your property for lease. This includes professional photography, showing service, listing your home on the local Multiple Listing Service (MLS), screening tenants and preparing all lease agreement paperwork.

Our Eviction Protection Plan protects a property owner when a tenant fails to pay rent. In the event that a Five Star Property Management placed tenant fails to pay rent, we will process, serve and file all of the necessary eviction paperwork and handle the entire process with our attorneys, which includes covering legal fees and court costs of up to $2,500.

Once you decide to change from your current property management company to Five Star Property Management, the process is actually very simple. Just call or email your existing property management company and let them know that you no longer wish to do business with them. At this time you will also need to request that your existing property management company send you all keys to the property, as well as any maintenance reserves or security deposit funds. We will then notify your tenants via mail, email and phone regarding the change in management and will instruct them on how to pay their rent, submit maintenance requests or report any other issues moving forward. That’s all there is to it!

We know that there are companies out there who charge less than we do. However, the reason they are forced to do this is because they cannot compete with our award winning levels of service! So yes, you end up with a discounted fee, but only because you get a much lower quality level of service (which usually ends up costing you more in the end due to lower quality tenants and less overall experience in the industry)

The difference between an experienced company at a 10% fee VS. a less experienced company at a 7% fee is less than $3.00 per day! See for yourself:

• $3K monthly rent x 10% mgmt. fee = $300/Per month
• $3K monthly rent x 7% mgmt. fee = $210/Per month

$300 – $210 = $90/ 30 days = $3.00 Per Day difference (or less than the price of 1 cup of coffee)!

We have been in this industry long enough to realize that you cannot have both quality service and low fees!!

We have found that the most successful rental properties are owned by owners who understand the following:

• Owning rental property is a business: With any business there will be expenses. In this case, they will come in the form of appliances, painting, flooring, windows, landscaping, roofing, etc. The good news is that most of these expenses can be tax deductible, and any improvements you make to the property will reap countless rewards in terms of higher rent and higher quality tenants.
• The nicer the property, the higher quality the tenant: Once again, the most successful property owners out there realize that you can’t put lipstick on a pig and expect it to become a supermodel. You need to start with the basics and work your way up. The property needs to be well put together, with good working appliances, clean and updated fixtures and paint and attractive curb appeal. Once you have the property in tip top condition, your property will appeal to a much higher end demographic which means higher rents for you!

By leveraging our experience and team of dedicated professionals, we create steady cash flow, limit liability and simplify your life!

Our standard Property Management agreement authorizes us to approve repairs up to $500 per occurrence (some agreements may vary). Anything in excess will need to be approved by the owner in writing or email. Through your owner portal you will be able to view maintenance requests we receive from tenants and you are always welcome to call or email to discuss any questions or concerns regarding such maintenance work.

Of course, just ask!

Per the IRS, many of the costs associated with your rental property are tax deductible including Management fees. Please see https://www.irs.gov/publications/p527.

No. However, considering the high level of service and the high-quality results that we get for our owners, we are more than worth our fee! One other way to look at fees is like this: There are many price levels for parachutes, but do you really want to jump out of the plane with the cheapest one?

Prior to move out the tenant may request a pre-move out inspection with us. We will also provide them with a list of items they must clean and we will go through the home with them in order to make them aware of any conditions that would cause us to deduct from the security deposit. This provides the tenant with the opportunity to fix the issues prior to moving out. With our strict screening, pre- move out inspections and high cleaning standards, the home should be left in good condition with just normal wear and tear. If there are any items which require repair, the costs of those items will be deducted from the security deposit. As a side note, there are common industry standards in regards to what conditions can be deducted from the security deposit based on the time the tenant had been living in the home and we can discuss those standards with you. In the end, we have 21 days to provide the tenant with a breakdown of what they are being charged out of their security deposit.

By adhering to our strict screening standards we attract a higher quality of renter. However, there will be times when even the best renters do not take care of the home as well as the owner would like. Condition is very subjective and normal wear and tear is expected. We always look to our lease agreement in determining if a tenant is inside or outside of his legal obligations regarding condition of the home. If we determine the tenant is not acting in accordance with the lease we will take the appropriate steps.

The lease contract does cover maintenance of the yards and watering, however, this condition is very subjective and hard to legally enforce. In the event the tenant is not keeping up the yard their lease agreement does allow us to hire a gardener and charge the tenant for upkeep. However, many times the issue is a watering issue (if the tenant is paying the water bill). If you are concerned about the exterior landscaping of your home we suggest that you have the lawns maintained by a professional gardener and consider paying the water bill. This can be part of the original lease agreement and can be accommodated for in the rent amount.

Legal notice must be given in non-emergency situations. Although a 24 hour notice of entry is sufficient in some situations, there must be legal cause for this. Annual inspections are usually scheduled 1-2 weeks in advance.

We will hire and work closely with a professional Eviction attorney to handle the Eviction process. The approximate cost to the owner for an un-contested eviction is $850 – $950 in attorney’s fees for the Peninsula and slightly more for un-contested evictions in San Francisco.

Five Star Property Management performs annual Property Maintenance reviews which allow us to ascertain the condition of the home and confirm that plumbing, electrical, health and safety issues are addressed and the home is in habitable condition. We also do a drive by/exterior review every three months and at various other times if we are alerted of issues or have concerns.

Yes, we do this as well. Call for a quote.

It depends. If the item is a legitimate wear and tear item, the owner would be charged for the repair. However, if it is found that the tenant is responsible for the issue, we would bill the charge back to the tenant. As a reminder, you will be required to deposit $500 into the Broker’s trust account as repair reserves. When this amount is depleted it will be replenished either when the rent arrives or we will request a check from you. We have an approval process we follow to allow you to authorize repairs and it will be a part of your property management agreement.

Security Deposits are usually held in the Broker’s trust account as most owners have found that this arrangement works best.

We distribute paid rents (minus management fees) by the 10th of every month.

Nationally the average is somewhere between 5% -7%. However, our average is much lower as our screening criterion is very strict! But keep in mind that even the most reliable tenants can lose jobs, get divorced or face illness that changes their personal circumstances and ability to pay rent. Thankfully, we have found that in even the most challenging of circumstances, higher quality tenants do their best to give us advanced notification and will work with us to find replacement tenants so that the owner’s income stream is uninterrupted.

Most insurers will recommend what is commonly referred to as a “Landlord’s Policy”. This is not the same as your regular “homeowner’s insurance”, there are important differences. Please consult your insurance provider for the best advice.

They will have several options to get in touch with us. The first option is to go on line to their tenant portal and submit a maintenance request. The second option is to call our 24/7 hour emergency phone line (try it for yourself…650-243-0449). Either way, Five Star will be notified! What happens if my renter is late making rent payments?

The lease agreement gives the tenants a 2 day grace period (Due on the 1st, plus 2 days grace = rent must be in by the 3rd. If the rent is not in by the 3rd we will serve a legal 3 day notice to pay rent or quit. If no communication is received after the 3 day notice expires we can begin a formal legal action (after consulting with you, the owner).

The Peninsula, San Francisco, South Bay and portions of the North Bay. Specifically, San Mateo, Burlingame, Mountain View, San Francisco, Los Gatos, Sunnyvale, Palo Alto, Redwood City, Redwood Shores, Foster City, San Carlos, Belmont, Daly City, South San Francisco, Brisbane, San Rafael, Novato & Sonoma.

If your lease states that a portion of the property will be reserved for Landlord’s storage purposes and the lease is clear on the matter, then yes, this is possible. HOWEVER, it is NOT recommended. There are many issues surrounding this arrangement. For example, if you need something that is in storage you cannot simply walk onto the property and get your belongings as you would have to give the tenant legal notice to enter the property. Also the lease would need to spell out that the tenants are NOT responsible for the security or safety of your belongings and you would have to assume the risk of vandalism, theft or the possibility of your belongings being destroyed. There may be insurance issues involved as well. Lastly, we have seen many problems arise from these types of situations and discourage this. Let’s talk!

Yes and No. 99% of our owners direct Five Star Property Management to handle all repairs because of the discounted rates that we can get for them. Additionally, we have a long list of professionals who can jump right on the job and get it done! Because of this, we have developed systems so that these repairs are done in a timely, cost effective manner and with professional workmanship. When an owner requests to do repair work on their own, these repairs fall outside of our proven system and the opportunity for error is greater. With that said, we have had some owners that are professional tradesmen, such as an owner of a heating and cooling company. In this case, it makes sense to utilize the property owner’s own company to service their rental property.

Yes, we can advertise occupied homes and work with you to find a renter before you move so that your vacancy costs are lowered.

Definitely, we have helped hundreds of investors with the purchase of investment properties and own our own as well.

Five Star typically conducts drive by reviews every 3 months and also upon request or as needed. Interior reviews will be done at least annually. Interior reviews may also be done if there is an emergency or legally justifiable purpose and will be done with proper legal notice. There are many legalities surrounding entering a rental unit (even if you are the owner) and Five Star will always follow good legal protocol on such matters to keep you, the owner, in compliance.

Yes, we can help coordinate major & minor repairs. We will review the scope of work with you and discuss a plan of action that works for you and your budget.

We will sit down with you and review your current situation, including your contracts with the tenant and discuss the problems you are having. We are here to help!! If we feel it’s a problem that can be dealt with, we will take it on! Many times tenants respond more favorably to professional property manager than they do the owner of the home. We have lots of legal and real world knowledge in our arsenal to help you with tenant problems.

Yes.

We will do a rental evaluation on your home after we see the interior of the property. We will discuss the pros and cons of your home and suggest a rental amount to you. We have an abundance of experience pricing rentals correctly and can help you make a good decision.

Provided that we price the property correctly, most of our properties will rent within 15 days or less. However, we can’t guarantee how quickly your home will rent as there are many factors that will affect your time on the market such as condition of the home, amenities, location and price range. But rest assured that we will do everything within our power to get your home rented to the most qualified tenant as quickly as possible!

Our vendors are chosen for many factors. First, we work with reputable companies who have proper licensing, past history with us and are dependable and will respond in a timely manner to repair requests. We are familiar with standard industry pricing and expect our vendors to provide fair pricing, timely response and ethical evaluations of the repairs needed. When we feel a price does not make sense, we will question the price with the vendor. In emergency situations and after hours some costs will be higher than during normal business hours. We will treat your rental as if it were our own!

Your home will be advertised on all the major rental websites including YouTube, Hotpads, Lovely, Rent.com, Craigslist and many more! It will also be featured on our own website which is where the majority of our quality tenant conversion comes from.