REAL Income Property™ Standards
Available properties are low in supply across the nation and sell very quickly. If you hope to acquire rentals you need to be able to move quickly. That said, it’s important to not make any mistakes in your haste. We created our REAL Income Property™ Standards to help you with this process.
Here’s what the REAL in REAL Income Property™ stands for:
R – Renovated (to REAL Income Property™ Standards)
E – Examined (through inspections)
A – Appraised (purchase price at or below market value)
L – Licensed property management
Please Note: If you’re working with a Property Team and are considering purchasing a property and that property does not meet the REAL Income Property™ Standards above, please contact your investment counselor.
R – Renovated
|Roof||Replace if less than 5 Years remaining life, approved per either Home Inspection or 4 Point Inspection.|
|Furnace||Replaced with new or serviced with one year warranty certified by a HVAC Contractor|
|Boiler||Replaced with new or serviced with one year warranty certified by a HVAC Contractor|
|A/C||Replaced with new or serviced with one year warranty certified by a HVAC Contractor|
|Plumbing||Home Inspection accepted by the buyer and updated Finish Plumbing.|
|Hot Water Tank||Replaced with new or serviced with one year warranty certified by a HVAC Contractor|
|Foundation||Home Inspection accepted by the buyer.|
|Electric||Home Inspection accepted by the buyer.|
|Flooring||Updated or functional; Approved through Home Inspection.|
|Kitchen||Updated or functional; Approved through Home Inspection.|
|Bathroom||Updated or functional; Approved through Home Inspection. property teams agree to ensure Bathroom/Flooring and Kitchen is at or above Neighborhood and Tenant Standard.|
|Interior Paint||Freshly painted.|
|Exterior Paint||Home Inspection accepted by the buyer. Additional cost if repainted requested.|
|Appliances||Market Specific. Refer to your provider.|
The following are the Property Management Standards Agreed Upon by the Property Teams:
- 1st Tenant = 80% of Monthly Rent (20% discount from National Standard)
- Lease renewal = 25% of Monthly Rent.
- Maintenance Warranty – 60 days maintenance warranty.
- There are no other additional vacancy and maintenance warranties.
Note: Please check with each Property Team; some are still in process of making these changes.
E – Examined through Inspections
Before purchasing a property, it’s essential to have an independent inspection completed. Property Teams will provide you with 3-5 licensed, local inspectors who understand rental property. The expectation should verify that the property meets or exceeds our REAL Standards.
A – Appraised Below Market Value
If you are getting traditional financing, you will receive a bank appraisal. If you are paying cash, we will recommend you get a third-party home appraisal.
L – Licensed Property Management
As we all know, property management is the most important ingredient for success in long-term real estate investing.
Property managers within our Referral network are required to be properly insured and licensed according to their state laws. It’s also recommended that they have at least 2 years’ experience with a great track record, and use professional management software.