The property management strategy a property investor chooses is arguably the next most important factor (after the location of the property) for the success of their investment. Property management affects not only the performance of a rental but the property investor’s ability to grow. This piece will highlight the strengths of hiring an outside property management group rather than managing the properties on your own.
Overseeing the day-to-day running of an investment property involves a list of diverse tasks that take a lot of time. Every property owner will come to the point, at one stage of their investment journey, where they must decide if they want to spend their time managing buildings and tenants.
The choice for the investor is between retaining direct control of their properties versus gaining more time freedom. Resolving this issue is vital because most people who invest in properties do it partly with the hope of freeing up their time to do more of the things they love.
As a property owner, you have a choice of managing the property yourself or hiring a property manager to do it for you. You should know that the property management strategy you choose will affect not only the performance of your rental property business but the lives of your tenants also.
How does hiring a property management company affect you and the tenants in your property?
How a Property Management Company Benefits Landlords and Tenants
We’re going to look at the benefits for both groups of people. First, we’ll start with landlords then we’ll cover benefits that tenants will receive.
Property Management Benefits for Landlords
1. Effective Property Marketing
Property managers use a variety of online and offline tools to spread the word about vacancies in your rental property. This means they can fill vacancies a lot faster than you can. Furthermore, they get bulk discounts on ads and can close deals with prospective tenants faster.
2. Systematic and Timely Property Maintenance
Successful property management companies have developed systems that let them manage the structures and systems of a building in a timely and efficient manner. The property manager does a better job of maintenance than the owner because they have better access to competent workers.
3. Compliance with Local Ordinances
Property management companies typically operate within a given area. If that company has been in operation for a long time – as it should be – it would have become familiar with all the laws that regulate rental properties in that locality. A competent property manager can help you avoid issues that will get you in trouble with the authorities.
4. Access to Local Expertise
The property management company is often the person on the ground. They know where to find the best local experts who can make your experience as a property investor easier. Instead of starting fresh to build your own network and making the inevitable mistakes, you can take advantage of the property manager’s network of vetted professionals.
5. Top-notch Tenant Screening
Accepting the wrong tenant into your property will make your real estate investments more likely to fail. Property managers have seen so many tenant applications; they have developed a sixth sense for sniffing out trouble. The property manager’s processes will ensure you get quality tenants who will rent for the long term.
6. Avoid Legal Problems
Operating a rental property is fraught with legal landmines. From the tenant-screening process to the lease terms, the condition of the property, and how you handle the tenant’s security deposits, there is no lack of opportunities for tenants to sue you. But a property manager can ensure that this does not happen.
7. Better Tenant Relations
Property managers are dispassionate in the way they deal with tenants. As a result, they have fewer problems collecting the rent on time and enforcing the terms of the lease. They also save you from the messier aspects of tenant management, such as evictions.
8. Better Overall Profitability
The combination of quality tenants renting for the long-term, timely rent collection, lower maintenance costs, shorter vacancy periods, and very low probability of lawsuits means that under the care of a property manager, the asset will perform better.
Property Management Benefits for Tenants
1. Greater Sense of Freedom
Tenants feel a little ill at ease living in a home that is managed by the owner. They may find it somewhat difficult to communicate their issues freely to the landlord.
Moreover, having a property manager in charge of the home creates a perception of professionalism. Tenants intuitively view rental properties which are managed by a property management company as high quality.
2. Timely Response
Tenants can expect a high degree of responsiveness when they live or work in a property that is overseen by a property manager. Property managers often have a lot of buildings under their charge.
So they are forced to acquire systems and implement strategies that help them manage more effectively. The tenants in the property can expect emergencies and routine maintenance to be handled more speedily.
3. Better Quality Services
Property managers have access to top-level experts necessary for the maintenance of a property. Because they have many properties under them, the best handymen and tradesmen want to work with property management companies.
This is because they know that with a property manager, unlike a landlord, they have a steady supply of jobs. As a result, tenants in the property manager’s building have access to higher-quality services.