Property management companies are third-party businesses that handle many aspects of rental properties – from keeping the property healthy to ensuring excellent and high-quality tenants are living within its walls. They run all the day-to-day operations of rental properties, so the investor doesn’t have to. And, since keeping vacancy rates low can mean the difference between making money or losing it, it’s good to involve the professionals.
Whether you are a new rental property investor or have been in the game for years, you have likely heard someone mention a property management company or know someone who uses one. Or maybe you have wondered whether or not it would be a good choice for you. Many investors turn to property managers to handle their rental properties. Why? For many different reasons, but mostly because managing rental properties can take a lot of time and requires a specific skill set. Plus, they handle all types of properties, including:
- Condos and apartments.
- Single and multi-family homes.
- Commercial offices and retail spaces.
Let’s look at what property management companies do – and the benefits they bring.
The Cost and Value of Property Management Companies
While having a property management team makes sense for an investor, you don’t have to have one. You can invest in a piece of property, maintain its condition, market the property, select your tenants, collect your rent, and answer calls at 1:00 am that the air conditioner stopped working. Or, you could hire a property management team to handle it all for you – because it just makes good business sense. Maintaining a rental property – let alone more than one – can take up a lot of time as there are many things involved. So, if you are on the fence about a property manager, this is when you may want to consider one:
- You own more than one rental property.
- You don’t reside near your rental property.
- You don’t have much spare time to dedicate to the property.
- You aren’t interested in being an active landlord.
- You can afford to pay a small percentage of your rental revenue to a management company.
The Role of Property Managers
Property managers are professionals when it comes to managing property. They know exactly what to do and how to do it. They also have the right team to get it done. Sure, you will have to pay for their service, but as an investor, you know that you are making a wise move when the benefit you receive far outweighs the cost. And that is what most find when they turn their properties over to the pros. A property management company will:
Having property marketing knowledge, knowing where or which channels to advertise through, and effectively reaching your target audience is essential. A property manager understands just how to do that, so you don’t have to worry about extended vacancy rates. This also includes setting the rental rate, drawing up leases, showing the property, etc.
Attracting and Retaining Tenants
You don’t just want any tenants on your property; you want good tenants who will pay their rent and treat your rental as if it was their own. They will provide a thorough tenant screening and keep your unit occupied.
This is, perhaps, the easiest part of the job. Because they are set up for managing properties, they don’t have to go from door to door to collect rent from tenants. Most have online platforms that give tenants the ability to pay online. And when it comes to those tenants who are hard to collect from, a property manager knows just what to do – even handling the eviction process.
Repairs and Maintenance
It doesn’t matter how great of condition your rental property is in; it still requires regular maintenance. This means handling repairs for broken appliances, blocked plumbing, and so forth that come in from the tenants – and it also means regular, routine maintenance such as lawn care and tree trimming, clearing the gutters, replacing broken screens, replacing the carpeting, give it a fresh coat of paint, etc.
For an investor, having a property manager means being able to continue investing – or working your full-time job while earning your passive rental income. If you choose to handle your rental properties on your own, you may be surprised at how much work is involved. Unless you are making being a landlord your main gig or you have a lot of extra time to spare, you may find that having a company handle it all provides relief.
Benefits of Property Management Companies
Hopefully, you are seeing the benefits of having a property management company handle your rental property by now. But just in case, here’s why you need one:
- Find quality tenants you can trust.
- Reduce your vacancy rate. Remember that you are losing money when your rental units aren’t occupied by paying tenants.
- Reduced costs for maintenance and repair. Property managers have their team of experts to get the job done, so you don’t have to hire an outside, unknown source.
- Minimize your liability – especially if you aren’t sure what you are doing. There are various landlord-tenant laws surrounding many aspects of owning rental properties – and working with professionals who know these laws can reduce your risk.
- Finally, tenants prefer maintenance companies. They know that when they need something, they can reach out at any time and get a response. They understand that a team is available to take care of any issue. And that it’s often a better overall rental experience.
Many investors begin focusing on rental properties with the idea that becoming a landlord is an easy job. Yet, spending just a short amount of time can prove otherwise. There is a lot of work to maintain a rental property – especially if you want to keep a healthy rental property. And an experienced team like RPM Evolve can be a welcomed help.