Quarterly Report July 2009

The economy here in Southern Oregon is pretty tough right now.  Oregon ’s unemployment rate as of May was 12.4%.   Jackson County , which is fairly representative off our region, has unemployment close to 14%.  As bad as that sounds, it is not nearly as bad as where I was born and raised, Mount Vernon, WA .  Mount Vernon is near the Canadian border, between Seattle and Vancouver BC. Unemployment  in winter ran as high as 35%.  Even in the best of times and seasons, the unemployment rate never dropped below 15%.  I say this to encourage us to keep looking on the bright side.  More than 85% of us have a job, income and prospects for an improving personal economic situation.  Rents are still soft due to the large seasonal rental inventory,  but on the other hand,  the plunge in property values has pretty much stopped.

Apartments are experiencing higher than usual vacancy rates.  Some apartments have a 35% vacancy ratio, while others have a 15% vacancy ratio.  There are plenty of houses competing for apartments plus the natural vacancy due to college summer break. The housing vacancy rate will improve beginning August in preparation for fall quarter.  As always in mid-summer, fewer tenants are moving.  Our records indicate a 50% drop in 30 day move-out notices from June.   Quality Property Management vacancy rates continue to be considerably lower than the other property management companies.  The local Southern Oregon Residential Owners Association’s (SOROA) latest vacancy rate is 9.4%.  (Property management companies reported 10.5% to 12% vacancy rates)  Our current vacancy factor as of July 14, 2009 is 5.61%.

On an entirely different subject, we are making a change in our accounting periods.  Our accounting system was originally set up on a “fiscal month” , from the 20th to the 20th.   This can be confusing as your current statements cover account activity in two calendar months. The change will also end our need for year-end adjustments.  Beginning in August, we are changing accounting periods to a calendar month.  That means several things.  (1)  Your statements will cover only the days of   calendar months and will not include any days from any other month. (2)  Since your net rent check is of prime importance, you will continue to get it in the middle of the month. (Again, I highly encourage you to sign up for direct deposit. You’ll get your check a week earlier).  (3)  Your statement period will close at the end of each calendar month.  When you review your statement, you will see all activity for the previous month.

August statements will be as usual. However, your September statement will be mailed early in October covering August 20th to September 30th.  Thereafter, your monthly statements will cover the calendar month indicated at the top of the statement.  I trust you will like the change and find it easier to understand.

Enjoy the remainder of the summer. 

Bob Rood

Pres. QPM