|Property Owner Frequently Asked Questions
What is the Homes In Transition Program?
Homes In Transition (HIT) breathes life into vacant houses! HIT offers a unique program matching qualified Caretaker occupants with vacant houses which greatly improves the marketability of the property while preserving both the value of the property and the neighborhood around it.
Why should I enroll my house in the HIT program?
- Keeps the property Insurable because it is occupied and not vacant.
- Preserves the value of the asset through regular maintenance and oversight of the property.
- Cost of the program is minimal and pays for itself after 30 days of Caretaker occupancy. (See program cost below)
- Problems get reported in real time rather than being discovered after causing major damage.
- A HIT Caretaker Occupied house competes better in the marketplace resulting in better offers and faster sales.
- Keeps the property safe and more secure.
- Keeps the neighborhood safer and preserves the image of the neighborhood.
- Brokers are more willing and able to show a HIT occupied house than a vacant or tenant occupied house.
- Use of program may keep the property from going into foreclosure.
- Owner can rest easy the property is being protected and free of unwanted visitors.
- Provides safe environment for Brokers and their buyers.
- Utilities and other regularly occurring property service expenses are paid.
- Caretaker occupants are subject to regular and random inspections of their performance and care of the property.
Who would be caring for my house?
Caretakers are individuals or families that are carefully placed into our vacant houses where they live until they sell. The Caretaker we would be placing in you or house is pre-qualified through HIT's comprehensive background check process. They are matched to the house based on their needs and the quality and quantity of their approved furnishings. Caretakers are professionals, blue collar workers, single, married, with kids and without and some have pets that we place only with your written approval. Many are referrals from Brokers that need a little time to correct some credit issues before they can buy a house - kind of like an incubator for potential buyers! They are NON smokers, and all must agree to a high level of accommodation for your Brokers selling process and marketing of the house.
What is the cost of the program?
There is NO UPFRONT COST for Property Owners to use the HIT program. All applicable fees are collected after closing!
The cost of the HIT program is $1500.00 but diminishes by $500.00 every 30 days the Caretaker occupies the house. After 90 days of our Caretakers occupancy, if the house is not sold, the fee for the HIT service diminishes to zero (no cost) and you continue to enjoy the same professional service till your property sells. If the house sells within the first 90 days of our Caretakers occupancy, the small applicable fee is collected after closing.
To illustrate the net savings, when you consider the costs to insure, maintain, secure, stage, heat, cool and maintain the landscaping for a vacant house, it's estimated to cost over $1000 per month to provide the same level of service HIT provides for the average vacant property. That's in addition to the monthly mortgage payment (holding costs) and insurance costs. Therefore excluding the mortgage and insurance costs for simplicity, if the house sells in the first 30 days (WOW!) the average net cost to use the HIT program would be only $500.00 ( $1500 - $1000) for the first month! If the property were to sell in the first 60 days (still not bad) the cost to use the HIT service becomes less than ZERO ($1500- $2000!). The fact of the matter is that beginning the first day of our Caretakers occupancy of your once vacant house, you keep more and more money in your pocket to the tune of $1000 OR MORE per month. The fact that you are not spending this money to provide for the maintenance, security, utilities, and MARKETING of your house, means you have more money every month to put towards other better uses besides breathing life into your vacant house. Yes, we are motivated to help sell your house! We earn a little bonus from the Diminishing Fee arrangement if we do and you keep a lot more money in your pocket!
If you are bank or government institution, HIT will be happy to negotiate a service program tailored to your needs. The fact HIT can eliminate by 100% the monthly asset management / preservation costs while promoting faster sales and higher offers and provide a far more neighbor friendly option for your vacant house holdings, means a lot less RED INK!
How does having a Caretaker in my house effect my insurance?
If your house is owner occupied your coverage will only change a little bit. There is usually a slight cost adjustment for a HIT Caretaker Occupied situation (Homeowner Fire Policy). However, if your house is currently vacant and has been for the last 14 days, your property insurance could be void! The cost to obtain vacant house insurance is anywhere between 3 and 7 times more expensive than a standard Homeowner policy.
IF YOU'RE NOT SURE ABOUT YOUR CURRENT INSURANCE COVERAGE ON YOUR VACANT HOUSE PLEASE CALL YOUR AGENT NOW. Paying premiums every month DOES NOT mean you have coverage! If your agent tells you they will not insure a tenant occupied house, contact our office for an insurance agent referral that will get you the coverage you need while your house is enrolled in the HIT program.
What if I don't like the Caretakers performance?
Caretakers, like everyone else,are human and not perfect. If you or your Broker ever have a complaint, we will listen, gather all the facts from all parties involved and take decisive action to remedy the situation that day! We have ample staff to field the call, perform an emergency onsite visit of the property, if necessary, and resolve the issue quickly. If the issue cannot be resolved the Caretaker is removed from the program and the house refilled. While this situation has only occurred less than .02% of the houses that have been served thought the HIT program, the consequences of NOT using the HIT program would expose the vacant house to even greater risks that have a much higher percentage of occurrence.
Is Anybody watching over the Caretaker?
Yes! HIT maintains a staff responsible for the regular and random inspection of every property in our program starting on day four in which we carefully review and modify the furnishing setup inside the house with our Caretaker. Weekly inspections are conducted thereafter to ensure our Caretaker understands their role and has the house show ready. We inspect the property regularly until it is sold and leaves the program.
What happens when the house is sold?
First, we cheer another success story!
The Property Owner provides HIT with notice of the closing and arrangements are made by the HIT to relocate the Caretaker. The property is cleaned and ready for the new buyer on or before the closing date specified in the notice. Because it is HIT's goal to accommodate ALL closings, under extreme cases your property can be available in as little as 30 days. The Notice process is dictated by state law by which we all must abide. Because each Caretaker in the program is highly valued and we can all appreciate the moving process, providing Caretakers the longest notice possible is always HIT's goal.
How can I be sure the house will be in good shape when the Caretaker leaves?
Our goal is to always return the property to you or the new buyer in as good or better shape as it was when enrolled into the HIT program. To ensure we get it right, we video tape the property floor to ceiling, inside and out, front curb to back wall before the Caretaker moves in. This provides as good a record as possible for both the Property Owner and the Caretaker establishing the existing condition of the house. Upon the Caretakers departure from the property, HIT performs a Move-out Inspection and reviews any suspicious areas against the video record. If there is an issue that needs to be resolved HIT's Customer Service Department mobilizes the necessary services to resolve the problem quickly and efficiently.
What happens if the Caretaker doesn't move?
Unfortunately a Caretaker is human and their performance can never be guaranteed. Since the first caretaker in 1986, there have only been 2 known cases of Caretakers not surrendering a house in time for closing. This is not to say our Caretakers are near perfect, but it does mean that HIT's professional approach and years of experience provide the broad base of knowledge to resolve these issues before they affect a closing. In a combined total inventory of houses reaching well over 2400 properties, it's a very small percentage risk. Could it be an expensive risk? sure, but compared to the level of risk and possible expense of holding the property for a longer period of time, possibly having to accept a low ball offer, having the house sold on the court house steps, having it vandalized,burned down, damaged by a major system malfunction that causes significant damage, having an unnoticed roof leak, broken water pipe or other possible situation occur without notice, the risk of having a Caretaker hold up a sale has a much lower risk factor. To further insulate the Property Owner for this acceptable risk, HIT provides a modest daily liquidated damages provision in the Property Mangement Agreement to help offset this type of unusual occurrence should it happen.
The bottom line - HIT has the experience and vast array of tools and unmatched knowledge to help prevent or mitigate this type of situation.
Can I choose who is placed in my house?
Because we are responsible for the placement and the successful performance of the Caretaker, we like to have control over who gets placed where. You can be sure that while we are not perfect, we have years of experience and a feel for our Caretakers and an understanding of their needs and the experience in creating the kind of relationship that is vital to a successful process. Our goal is to not create a long term relationship for you but to get your house sold and move on to the next. Nobody has the level of skill at performing this task like our very experienced Staff.
What about Utilities, Home Owner Association fees and the like?
Association fees, utilities, refuse service and other required “public service” expenses are costs that get paid for any home in our program that is occupied by a HIT Caretaker. Pest control, window cleaning, lawn maintenance, pool cleaning services, septic tank pumping, and services required to get the property in its best possible selling condition are typical of optional services that are not covered by our program without agreement to do so written into the Property Lease and Services Agreement
In General, Utilities will be transfer from the Property Owner to the Caretaker upon the Caretakers occupancy of the property. This process is verified by the fact you will not get further bills once the property is occupied and the fact that we record the confirmation number of the service switch. When the property becomes vacant the utilities will revert back to the Property Owner. If the utility is lienable, like the water in Albuquerque, it will be paid monthly by Homes In Transition and billed to the Caretaker thus avoiding any liens at closing.
Unfortunately, some neighborhood associations charge their fee on a quarterly or even an annual basis, along with delinquency charges, if the entire bill is not paid in full and on time. HIT pays these fees on a monthly basis to the Property Owner, not the association. HIT occupies vacant houses until they sell, it is impossible to tell how long this term might be. Because we are not represented at the closing table there is no way for HIT to recover any monies paid in advance for association fees and the like. As a result, HIT does not pay any of these fees in advance of our occupancy. Rather, we pay all these types of fees in arrears much like one does for the public services that are delivered to the house.
Utility Providers have become very strict about providing service to vacant houses and in many cases are pulling meters from these houses. If the meter is pulled, there is considerable cost involved in getting new inspections and service restored. We encourage you to check with your utility provider to understand these costs if you plan on leaving your house vacant.