Being a landlord requires you to have a jack of all trades - juggling finances, home maintenance, sourcing tenants, and more. As your rental property business grows, these tasks can become overwhelming and can take away focus from building your real estate portfolio. This is where property managers come in. Property managers can play a crucial role in the day-to-day operations of your business, alleviating many of the administrative and maintenance burdens that come with owning multiple properties.
But, finding a trusted partner to care for your asset can be harder than it sounds, and for new landlords it can be difficult to assess what to look for in a good property manager. In this article, we'll provide some insight on the role of a property managers, the benefits of working with one, some of the associated costs, and considerations when hiring and onboarding.
You can use this information to consider your needs and decide if now is the right time for you to hire a property manager or if you're more suited to continue embracing the landlord role yourself.
The Property Manager's Role
Property managers are often employed by real estate companies, property management companies, or consultants. Their primary role is to take on the day-to-day management of a rental property/s for private or commercial landlords.
A property manager can take care of repairs, maintenance, rent collection, tenant relationships, admin tasks, and all those little things that can plague a landlord's mind. They can help increase the value of your property by keeping it well-maintained and rented to qualified tenants.
While these practical features are appealing on their own, the personal benefits help you enjoy your free time more, by providing peace of mind knowing that your property is in good hands. Having a company act as landlord for you also helps protect your privacy and allows some degree of personal safety.
Not All Property Managers Are Created Equal
Rest assured that investing in a credible and professional company is more than likely going to return a great experience with your property manager. However, it's crucial to remember that some people may not have the passion or expertise you might be expecting.
There is a lot to consider, but you mustn't let yourself succumb to decision fatigue and go with the first person you interview to avoid overwhelm. Choosing the right property manager will be a vital decision in determining the outcome and value you receive, this will be explored in more detail later.
The costs incurred may impact the return on your investment however, the benefits you receive from the service may save you money as well, so it can balance out.
The cost structure varies between organizations, often it will depend on the price you rent your property out for. You can expect to be invoiced initially for a percentage of the monthly rent when moving tenants in, and a monthly fee up to 10% of the rental price or simply a flat rate designated by the company.
Benefits of Having a Property Manager
A good property manager can be worth their weight in gold. They can save you time and hassle by taking care of all the little details associated with owning rental property, freeing up your time to focus on other things.
As a landlord, it's important to have someone you can trust to take care of your property. This is especially true if you don't live near your rental property and need to rely on another person to make crucial on-the-spot decisions regarding your investments.
The benefits of onboarding a property management company to assist with your real estate portfolio are exhaustive, here are just some of the ways a property manager can help.
1. Screening Tenants
One of the most important tasks of a property manager is screening tenants. They will run background and credit checks to make sure potential tenants are capable of paying rent and will take good care of your property.
Generally, property managers have the experience that enables them to accurately judge the suitability of a potential tenant. You can expect they've seen it all before and therefore, their character assessment can be relied on.
2. Handling Repairs and Maintenance
Another big plus is that a property manager will handle all repairs and maintenance issues as they come up. They will go through the process of finding contractors, negotiating responsibility with tenants, and sourcing items. Once again their industry contacts are going to help get reliable and fairly priced work. This will save you a lot of money time and hassle down the road.
3. Rent Collection
A good property manager will also make sure rent is collected on time, every month. This can be a huge relief for landlords who have had problems with late or delinquent payments in the past.
4. Handling Eviction Proceedings
If it comes to it, a property manager will also handle all eviction proceedings. This can be a difficult and stressful process, but they will know how to do it properly and efficiently.
Related Reading: The Pros and Cons of Being a Landlord
When Should You Consider Taking On a Property Manager?
If you're thinking about hiring a property manager, consider these signs that indicate it might be time to take the plunge.
You don't live near your rental property
If you don't live close to your rental property, it can be difficult to manage it effectively. This is especially true if you have multiple properties in different locations.
You want to be sure you are hiring someone who is trustworthy and will do a good job managing your property while you can't be there. Your property manager will take care of those face-to-face tasks, such as showing the property, repairs, maintenance, and performing property inspections.
You're having trouble finding tenants
If your vacancy rate is high or you're consistently having difficulty finding qualified tenants, it may be time to consider hiring a property manager. Not only do they know the ins and outs of accurately assessing a potential tenant, but they also spend their days creating contacts in the industry.
A good property manager will have extensive experience in marketing and advertising vacant property. They will have access to a wider pool of potential tenants through their networks and relationships with local real estate agents. They can find the right tenant for your property, recognizing potential tenants with a low flight risk and high reliability.
You're Consistently Dealing With Issues at Your Property
A property manager can be a great asset to any landlord who finds themselves frequently dealing with tenant complaints or maintenance issues.
Help alleviate some of the burden by hiring a professional who will take on responsibility for repairs and respond to tenant concerns. They can deal with problems as they arise so you don't have to worry about them.
You Don't Have The Time
If you don't have the time to manage your property, it's worth considering hiring a property manager. A good manager will take care of all the details for you, so you can focus on other things in your life.
Even if you live nearby, managing a rental property can be time-consuming and stressful. If you have other obligations that prevent you from giving your full attention to your rentals, then it's probably time to bring in some help.
Related Reading: Guide For Landlords - How to Deal With a Bad Property Manager
Advice for Hiring Property Managers
Enlisting the services of a property management company is a big decision. There are many benefits of having a property manager, but there are also some important considerations to think about when making this decision.
You want to be sure to find someone who is reputable and who has experience managing similar properties. Remember these tips while on your search for a compatible organization or person to hire.
Ask friends or family who own rental properties or have owned them in the past and used a property manager for contacts. Sit down with them and have chat about what they learned and things they would do differently next time. Testimonials from people close to you can provide nuanced context on qualities and experience that you might require in a property manager.
Spend time online researching candidates and ensure you have multiple candidates to add to a shortlist. If possible, engage professional research organizations to assist with information gathering.
Before making your final decision, read as many online reviews as you can and pay attention to what the landlord is trying to say about their experience with that person.
Meet with your favorite potential candidates to get a better sense of who would be the best fit for your needs. Meeting in person can sometimes show you a completely different person than you were picturing from reading reviews and background info. Remember while hiring a property manager does come with some cost, they are a great asset and the peace of mind and free time they can provide may be well worth the investment.
If you're considering hiring a property manager, you're likely dealing with one or more of the issues discussed in this article. Finding an expert property management company can help alleviate these issues and provide many other benefits.
With the help of a property manager, you can enjoy being a landlord without all the stress.