If you've owned income property for any length of time, you know that managing a rental can be financially rewarding. At the same time, you've also likely discovered that property management requires a large commitment of time and effort.
While
it may make sense to take the do-it-yourself approach if you're a handy person,
live close to your property, and don't mind devoting several hours per month to
the task, in many cases this just isn't practical---especially if you hope to
expand your business. With this in mind, here are some critical tasks a
property manager can help you with:
1.
Setting
the right rental rates: While
looking through the classifieds to see what other landlords are charging for
similar properties is a fine way to ballpark your rent price, a good property
management company will conduct a thorough market study in order to set a
rental price for your property, ensuring that you achieve the perfect balance
between maximizing monthly income and maintaining a low vacancy rate.
2.
Collecting
and depositing monthly rent payments on time: If you've ever worked in a billing department, you know that
securing payment from clients can be difficult, not to mention awkward.
Property management companies have efficient, tried-and-true systems in place
to effectively collect rent and maintain on-time payments. You'll find this
particularly important if you have a limited number of properties, and
collecting payments on time is crucial to maintaining your cash flow.
3.
Marketing
and advertising your property: Through long experience, a property manager will know
exactly where to market your property and how to craft compelling advertising
materials---a significant advantage when it comes to filling your properties quickly
and avoiding long vacancies.
4.
Finding
the right tenants: Experienced
property managers are experts at finding good tenants, and will take care of
all the details, including the securing all criminal background and security
checks, running credit reports, verifying employment, and collecting previous
landlord references.
5.
Managing
tenants: In addition to
finding good tenants, a property management company will manage all aspects of
the tenant-landlord relationship. The property manager will handle both routine
and emergency maintenance, take care of routine inspections, and manage any
situations where conflict resolution is required.
6.
Managing
vendor relationships: Property
management companies have relationships with maintenance workers, tradesmen, contractors,
suppliers, and vendors that it's almost impossible for an independent landlord
to duplicate. Not only will your property manager get you the best work for the
best price, they'll oversee any necessary maintenance projects.
7.
Ensuring
that you're in compliance with housing regulations and property laws: There is a multitude of applicable laws
and regulations to abide by when renting and maintaining your rental property.
These include local, state and federal regulations, as well as fair housing regulations
(such as the ADA). A property manager can help you avoid lawsuits by keeping
your property up-to-date and in compliance with these regulations.
8.
Enabling
you to invest in geographically distant properties: If you manage your own properties, you're
pretty much limited to investment opportunities within a tight radius of your
own home. By hiring a property manager, you can take advantage of investment
deals in any location you wish.
9.
Maximizing
the profitability of your time: By having a property manager take care of the day-to-day
aspects of running your income property, you’re free to spend your time
identifying further investment opportunities or otherwise furthering your
career.
10.
Maximizing
the profitability of your money: Most property managers charge a percentage of your
property's monthly rental rate in exchange for their services. The rate
typically runs anywhere from 6-10%, which is generally less than the money you
save by hiring a professional to take care of your property.