Some people go into residential, commercial and multi-family investments thinking it will be a breeze. After dealing with collections, maintenance, complaints, and repairs they will soon realize, being a landlord is a lot of work! At what point should you hire a property management company? It is a decision many landlords face.
Do the benefits outweigh the cost? Each situation is different. We have put together some points to consider before you hire a property management company.
What They Can Do:
Market the Property:
Pros: They will be able to showcase and highlight the property across many platforms. Property management firms often subscribe to the most effective online tools. Your property will likely be featured and placed in a more visible location on print and web materials. They will also post signs, list on the MLS, schedule showings, and process applications.
Cons: Many Property managers make most of their money form real estate sales as an agent make sure the manager you choose is going to be dedicated to taking care of your rental property as you would.
Pros: High-quality tenants vs. low-quality tenants will make or break your investment. Figuratively and literally. The average person doesn’t have as much experience as a property management firm when it comes to finding the best tenants for your home. An experienced property manager will spot red flags a mile away.
Cons: Be aware of property managers that have a, “first applicant with the money gets it” mentality. We have had managers put tenants with a walker in a house that had more than a dozen steps into the front door. This is not what we call “matching demographics to the house”. That’s why we got in the business… to offer landlording services that works properly and makes money.
Pros: Your property manager will collect the monthly rent on your behalf and enforce any applicable late fees the tenant owes. They are often paid in a more timely manner as a private landlord is typically more flexible. (read: Statistically, private landlords are more likely to get “trained/ walked on” by the tenant.) Your property management company can act as collections, chasing down rent if need be. They can also handle the majority of the eviction process which can be tedious and tiresome.
Cons: A good property manager will handle all of the eviction process in a timely manner and keep you up to date on any new developments as they arise. MANY DON’T. letting late fees and past due rents pile up for months and not communicating with the landlord or explaining why the tenant is still in the house. The system used by the new “Professional landlord” forces us to take action swiftly and decisively.
Raise Your ROI:
Pros: They will take a good look at the living spaces and the grounds. They should immediately be able to recommend cosmetic touches and upgrades that will boost ROI. A good property manager will be abreast of what competitive properties are offering as far as upgrades and unique property features. They should be able to provide information about taxes including deductions and necessary paperwork for the property. A good property manager will help you maximize your investment.
Cons: Ask your prospective property manager if they actually own rental properties themselves. Most don’t. A professional Landlord knows these aspects of investment properties because they practice what they preach on their OWN RENTAL PROPERTIES first. Don’t use a manager that can’t put their money where their mouth is.
Manage Maintenance & Repairs:
Pros: Your property manager will be able to keep up with maintenance and report repairs you might not be aware of. Experience goes a long way here. Knowing what to look for, as well as the most effective and efficient way to resolve the problem is a skill learned over time. They will receive multiple bids for repairs, ensuring your property receives the best service at the lowest cost.
Cons: The reality is that many property managers have backdoor deals with local handy men that cut them in on high priced repairs that don’t really get done or done properly. Again, this is why we became professional landlords. Ask a property manager if THEY WILL PAY for certain repairs out of their pocket. None will! Many of our clients have moved over seas to serve our country (PCS) and don’t have time or ability to worry about their rental investments. That’s what we are here for. We have no loyalty to any contractors and we WILL pay out of our pocket to take care of a rental property if we need to. Improvise, Adapt, Overcome!!
Why You Need One:
You Own Many Properties:
If you own more than one property or unit, being a landlord can turn into a full-time job. Piles of paperwork, vendor relations, tenant needs, maintenance, accounting.. it will eventually make your head spin. A property manager is key to managing multiple investment properties.
Investment rental property (especially residential rentals) is a people business. Sometimes, it’s best to delegate tasks like that to the professionals that can handle such tasks. The best ones are willing to put their own “skin” in the game. Ask if the property manager if they are willing to pay to get your rental house ready out of their pocket to take that burden off your plate.
Need Assistance Managing Funds:
The accounting alone on a rental property can turn into a full-time job. If you do not choose to employ a property management company, you should definitely make sure you have a competent accountant running your books. There are many deductions available to property owners. Only a Professional Landlord that has their own rentals at stake will stay current on the tax laws like section 197, “real estate professional” and “trade or business” expense deductions. Ask us why your taxes will be cheaper working with us.
You Are an Absentee Owner:
You can’t very well manage a property you own in Georgia if you live clear across the country or PCS over seas. Trusting friends to help “keep their eye on it” is likely to end in a dispute with the tenant or your friend (especially if your friend is not getting compensated). You would be better served to use a reputable and local property management company. Someone who is looking out for your best interest and has experience in taking care of disrespecting tenants, leaking roofs and busted water heaters. The people at Better Than Property Management make money providing good service to good homeowners that want a long term investment to produce… long term.
When you are ready to hire us, we will answer our OWN phone. Ask us any questions you like. Call us NOW.
Some people would rather keep this money in their pocket, while others see the incredible value in having someone else take care of the dirty work!
Are you considering a property management company in Warner Robins? If so, we want to help! Send us a message,or give us a call today! (478) 256-9947