If you own a rental property that, you rent to others for which you must collect monthly rent and provide maintenance, you may need a property manager. Do you have the time to see to your investments, as you should, to maintain their value? If you are finding that, your investments are becoming a burden that leaves you very little time to enjoy the fruits of your labor you may need to consider the cost of typical property management fees and whether or not this solution will work for you.
Do you need a Property Manager?
If you are one of the many property owners who have enough rental properties that taking care of them is a full-time job you need to decide if you want to be a property manager or investor. It is hard to be both because at some point you will not have time to do anything but collect rents, to repairs and perhaps perform some of the maintenance tasks yourself.
This is fine if it is what you want to do but the point of investing is to reach a point where you do not need to work so hard. If you have reached this point with your rental properties, you need to work smarter and retain the services of a reputable property management company to relieve you of some of your current duties and give you time for other pursuits. If you have two or three rental properties, though, and that is all you want, the cost of a property management company may not be feasible.
Can you afford a Property Manager?
Most management companies require payment in the form of the first month’s rent on your property or a percentage and a four to ten percent of the income. If you go this route, make sure that you are getting a company that takes care of all of the maintenance, including the HVAC, housekeeping, rent collection, and accounting. Make sure, too that their services include applications from potential tenants, a way to screen applicants and knowledge of the landlord/tenant laws of your state.
When you first begin acquiring rental property, you will probably work from your home and will not have access to the resources that property managers have and you will have to take care of the above-listed services, yourself. Forms for the rental and leasing of a property are readily available online or at your local office store and will allow you to act as property manager for your own property if you are not yet able to afford a property management company. If you must take this route, have your attorney educate you on the landlord/tenant laws of your state.
The cost for property management of just one property may be prohibitive unless the rent that is paid can support a six to ten percent loss of rental revenue. If you have one or two rental properties paperwork may not be an issue. However, if you build up to three, four, five or more rental properties or have rental properties peppered around the city, or in another state, they can become a time burning issue.
Are you tired of Dealing with Tenants?
Having a property manager will relieve you of dealing with tenants and their myriad of issues. Your only job will be to collect the rent from your property management company.
What are the benefits of Outsourcing?
Property managers have personnel in place and vendors for maintenance readily available and will save you time. The headaches that come with owning investment property will be relegated to the management company so angry tenants, 2:00 AM maintenance issues and rent collection will be someone else’s problem. This convenience has a monetary cost but the time and aggravation that you will be released from will be worth it.
What are the benefits Managing your own Property?
There are benefits to managing your property yourself and the greatest on is cost. You may not be able to or wish to give up five percent of your annual revenue from your rental properties and if you are required to give up ten percent the cost may be prohibitive. If you manage your own property you have complete control of decisions to be made about maintenance and tenants and will care more than a third party. After all, the property is yours, not theirs and although many property management companies say they care, there is no way they will care as much as you do.
Another benefit of managing your property yourself is the avoidance of fraud. Not all property management companies are the same and while one may be ethical and above board, another one may not be. Vetting a potential management company is recommended; otherwise, they could cause you more headaches than you currently have while charging you for them.
What is the Best way for you to Manage your Property?
Whether you choose to manage your properties yourself or hire a professional property management company, be sure to look at the financial outcome of both situations. Typical property management fees can be negotiated so you may be able to get services at a reasonable price. Be aware, however, that sometimes a lower price means a lower level of service, so if you go with a property management company read the fine print and know what you are getting when you hire a property management company.
2 Point Highlight
If you own a rental property that, you rent to others for which you must collect monthly rent and provide maintenance, you may need a property manager.
Property managers have personnel in place, and vendors for maintenance readily available and will save you time.
