A rental property of mine has recently become vacant and I’ve done something unimaginable, I’ve decided to hire a property management company to manage the property! In the past I’ve always managed the handful of properties I have on my own and for the most part it has been fairly simple. The most stressful and most labor intensive part of managing my own properties has always been cleaning up the property and getting it rented again. Cleaning up others grime is not a job I enjoy at all, from the actual yuck factor of it to the (why didn’t they take care of my home?) annoyance factor it’s just no fun. Calling contractors to schedule work is a big drain on time as well and once again impinges on my “funhaving” time. After the property is rent ready there’s the workload associated with getting it rented; advertising, accepting applications, showing the property, tenant screening, lease signing, etc. Wow, I just read what I wrote and I want to clarify that I am not whining “poor me to be burdened with rental properties” I just have decided that property management is a worthwhile investment and it goes beyond the convenience factor.
A good property management company will ensure that I’m dealing with quality tenants by thoroughly screening each prospective tenant. Having detailed background and tenant credit checks is crucial to the success. By implementing a tight screening process they will be able to select tenants that; stay in your rental for a long time, they pay there rent on time, cause less problems with neighbors, and take good care of your home.
2. Vacancy Rate
Highly qualified property managers will reduce a landlords vacancy rate. As I look over at my growing pile of receipts next to me, I can tell you without a doubt, tenant turnover is expensive; cleaning, changing the locks, painting the walls, and other repairs add up quickly. Having long term, reliable tenants in place will reduce expenses significantly. Property management can oversee improvements to the property, determine what would be a competitive rent rate, and market your home to a wider pool of people.
Using property management provides a buffer between you and the tenant and can alleviate some of the legal problems that landlords would normally have to deal with. Property managers are expected to know the state and federal tenant/landlord laws and have a better pulse on changes then a part time landlord might. They would know all of the legal and correct procedures for tenant screening, rent collection, the eviction process, move in and out inspections, lease writing, security deposits, etc. Lawsuit avoidance in and of itself can make using a property management company appealing.
4. The Bad Guy
Hiring property management to deal with the issues when they come up keeps you from having to say “no” when a tenant asks for an extension on rent, to have a pet, let aunt Myra move in etc. Property management companies implement tight regulations when it comes to rent collection there world is pretty black and with and they don’t accept any excuses. A good property management company will track down tenants to collect the rent, they’ll handle evictions and keep the landlord from being taken advantage of.
Using a property management company will give you the freedom to invest and live wherever you want. You won’t have to be near your properties, you can take that extended vacation to Peru to climb machu picchu . Spend the time working on other projects and investments. You can use the time doing whatever you like because it’s yours given to you by the use of property management.
Did I miss anything? There are a lot of reasons that having a good property management company on your side is valuable. Do you think it’s valuable enough or do you manage your own properties.