New to owning a rental property? You might be wondering whether you should hire a Management Company or give it a shot yourself. You are not alone on this quest, in fact as you grow your rental portfolio you may continue to ask this question time and time again. Not surprisingly, your answer will change as you move through your journey as a real estate investor and property owner. Wherever you are on your journey, here are a few tips to help you make your decision.
Our Top Ten (10) Reasons why you should hire a Property Manager:
Yes, you read that correctly. There is often the thought that the cost of hiring a property manager is too expensive and takes your profit away. Here’s another perspective, hiring a Property Manager can save you money. In the long term, a good Property Management Company will actually net more revenue due to increased care of the property. You will get quality tenants that remain in the property longer thereby having less damage and repairs to deal with. Having your property always in a ‘rent ready’ state boosts your financial leverage, for example, it will allow you to get the most money out of a property appraisal.
Maybe the most important reason to hire a property management company is that you will have access to a team of trusted professionals who know the industry. You can have peace of mind that your property is going to be managed well, and all of the stress won't rest directly on you!
As the landlord, are you aware of the laws with leasing your property? One of the biggest advantages of hiring a professional property manager is the ability to avoid some legal hassles. With a full understanding of all the state and federal laws when it comes to discrimination in screening and selecting tenants, property managers avoid breaking discrimination laws. In the event that an eviction becomes necessary, an experienced property manager will know how to handle the process that will save time and money while staying within the boundaries of the law.
This point alone makes your property management fee worthwhile! As a property owner, being involved in the day to day activities oftentimes result in you being too lenient on certain issues or too defensive about some complaints. Whereas, your property management company will have an unbiased approach to your tenant’s personal concerns that may threaten to overshadow the business aspect. When issues arise, a professional property manager is better equipped to handle issues effectively.
Buildings and individual houses need ongoing maintenance in structural aspects, plumbing, and electrical systems. Anything can pop up at any time, and repairs have to be attended to immediately to avoid inconveniences to tenants. A good property manager will have a preventive maintenance program in place to alleviate some of these concerns as well as a professional staff attending to the repairs.
It can be a full-time job to collect rent payments, track late fees, respond to complaints and repairs, "make ready" a property for new tenants, find quality vendors, and deal with poor tenant selections. It may also become a constant source of stress. Relinquishing these ongoing responsibilities to a good property manager can allow you to benefit from your investment without sacrificing your time and health.
Property management is a full-time job and it is crucial to routinely monitor your operational cost. Hiring a property management company with a full-service accounting department can help you set accurate market rates and ensure you’re not leaving money on the table with incorrect pricing strategies.
Property managers have a larger pool of applicants to choose from since they aggressively market their listings to the public. If you hire a good property manager with hands-on experience, they will know exactly how to find quality tenants and screen poor tenant prospects that do not match your tenant profile. An established property manager may also have waiting lists of potential tenants. This result provides better quality tenants in less time.
If you have gone through the eviction process, the Property Manager (with an attorney at their disposal) will guide you through the legalities of property laws.
Many property owners assume that simply listing their property on Real Estate Directories, such as Zillow, Loopnet, ZipRealty, etc. A good Property Manager must conduct a good marketing services plan, with several syndicated leasing and social media sites that will give your property the maximum online exposure. They will also be able to have spotlight marketing methods and can create custom advertising plans for each property. As a result, your Property should spend fewer days on the market, reducing your vacancy rate, and increasing your annual profit potential.