Benefits Of Property Management
Most people like to own property but are unsure of how to handle it since they may not be able to. This is where property managers come in. These are people who you hire as a property owner to deal with any issues concerning the property like any legal issues or tenants and so on. It is wise to consider property management as it is often an added advantage since property managers are skilled at their job. The benefits of property management are as follows.
One, you get to have the best selection of tenants if your property is a rental. This means that you will rarely have problematic tenants as the property manager will ensure that they vet all the tenants before allowing them to rent. They will also ensure that you do not have tenants who do not pay their rent on time.
Having a property manager also ensures that you do not have to deal with all the tenants on your own. If any of the tenants have a problem then they can talk it out with the manager who will then report it back to you. If the problem is not major, they can also assist in dealing with it. This saves you a tremendous amount of stress.
Next you get to have someone to deal with any legal problems that may arise. Say maybe there are suspicious tenants that are on the police radar, then the manager can handle these issues with the police without having to involve you.
A property manager will also be able to let you know if there are any improvements needed on the property. You do not have to go check on the property all the time. If the property is due for repair, the manager can also handle this. You do not have to be always present for the renovations. Apart from that, you can leave the issue of rent collection to the manager to oversee. This way, you do not have to always be present during rent collection.
Furthermore, a property manager will ensure that you get tenants in your building if there is a vacancy. If you are working by yourself, chances are that you might be too busy to handle the tenant screening or the vacancy advertisements. With a property manager, you can rest easy knowing that they will put out any notice of a vacant apartment and that they will handle any potential tenants that need to view the apartment.
Having a property manager is also important since they will ensure that there are no illegal activities going on in the building involving any of the tenants. If this is the case, the manager will ensure that they handle the lease termination and notify the tenant of the issue. In addition to that, the property manager will be the one dealing with any security deposit issues that involve tenants that have moved out.
It is important to have a property manager as they can help you in filing your taxes. They will also help in understanding any taxes that you have to pay. If you are too busy to handle the tax business of the property, the manager can handle this and give you the final copy of the taxes.
Although there are numerous benefits to having a property manager, it is important to keep in mind that not every property managing company will have the best personnel. You need to vet any potential property manager that you are looking to hire.
You should ensure that you choose a person who is trustworthy. Since you will be leaving most of the money issues to the property manager, it is absolutely crucial that you trust them. If you get an untrustworthy property manager, you could become a victim of embezzlement. This could cause your property to fail.
You must also have a property manager who is competent. The job requires the property manager to be able to deal with the tenants in an appropriate manner. There should be no harassment of tenants or taking advantage of them. You must interview any potential managers to ensure that they are competent.
Lastly, ensure that the person you get is a fit enough to handle the job and you will not have any regrets.
Why Work With Property Management Companies
If you work with more than one property, then hiring a property management company to handle a lot of the day to day hassle associated with lettings and management could be a good idea.
Property management companies vary in the services that they offer. Some management agents just collect rent and handle things like repairs, but others will address the legal aspects of taking care of property as well.
If you live close to the properties you work with, then being an active landlord could save you some money, but you might find that the basic work – repairs, inspections, preparing tenancy agreements, chasing late rent payments and handling disputes between tenants, for example – can be more work than you bargained for. Advertising to find new tenants and making sure that you are operating in compliance with the latest regulations regarding safety and tenant rights can take up more time than you might expect, and if you slip up you could end up in deep financial trouble.
A good property management company will take the workload off you, and will make things better for your tenants too. Yes, you will need to pay them, but because they make everything go more smoothly they should increase your income overall – especially if you have a lot of properties. They will take on tasks such as:
– Advertising vacant properties
– Checking tenants to ensure that they are suitable
– Arranging viewings for prospective tenants
– Conducting credit checks and reference checks
– Ensuring compliance with regulations in the area of the property
– Writing out tenancy agreements
– Organizing and managing deposit collection
– Checking the inventory and taking photos at the start of a tenancy
– Rent collection
– Accounting and payment processing
– Repairs and maintenance
– Property inspections
– End of tenancy inspections and deposit management
– Re-letting with minimal downtime when required
– Evictions and late payment chasing
– Handling tenant disputes
The property management industry is not really all that strictly regulated but there is a group called the Association of Rental Letting Agents which is well respected in the industry and that would be a good starting point for finding people to work with. You can also look at existing properties in your area and find out what agents those landlords used.
If you do not want to take advantage of a full letting and management service, you can usually select certain duties that the agent will take on for a reduced fee. Sit down and discuss this with the agent so that you know exactly what they are going to do for you, and what will be within your remit. If they tell you that they will do marketing, ask them exactly what that will involve, and whether there is scope for you to do your own marketing as well. Some agents claim to market, but do very little beyond the occasional online or newspaper advertisement. You need to know what you can expect, so that you don’t duplicate their efforts, and so that your property gets the attention that it deserves.
Some agents charge a flat fee, but this is relatively rare – most will charge a commission. On average, the commission will be between five and ten percent for a relatively basic service, and up to 15 percent if they are providing you with a full service. Get a breakdown of everything that the agency will do for you so that you can compare like-for-like quotes. Don’t be wowed by an agent that promises the earth but charges very little. Ask for a list of properties that they manage already, and see if you can talk to those landlords. You might find that the quality of service provided varies a huge amount between companies.
Paying a little extra is worthwhile if it means that the agent is motivated to give you the best possible service. This ties in to that old adage about spending money to make money – if you prove to your tenants that you want to make sure that your properties are well taken care of and that the letting service operates smoothly, you are more likely to retain them, and they will be more likely to recommend your services to their friends and family. In the long run, everyone wins this way.
The DOs And DON’Ts Of Hiring A Property Manager
If you own a rental property, it can be difficult to take care of on your own. As a result, many owners look for a property manager that can help keep things on the right track. Here are a few dos and don’ts that will help you find the best possible option.
DO make sure that any contract you sign has a termination clause. This part is supposed to detail what course of action should be taken in the event that you are no longer interested in doing business with them. The exact terms of this agreement will be up to your discretion, and you will have to make sure that it fits all the legal requirements of the area you live in.
DON’T forget to find someone who is fine with providing itemized receipts. When you hire a property manager, they will be responsible for the upkeep of a multi-unit property. This means that they will have to authorize repairs, purchase supplies and things of that nature. Scribbling a few notes on a pad to explain an expense is certainly not sufficient. Anyone who is unwilling to provide receipts should be taken off your list of considerations.
DO hire a licensed company. Being a property manager is about more than placing a title on a nameplate. You should always look for someone that has taken the time to attend classes and apply for a state license. This will show you that they are serious about what they do and they will strive to offer you the best possible service experience.
Just because someone states that they have a license, that does not mean that it is necessarily true. You should always ask for verification of licensing to ensure that you are working with someone who is honest and trustworthy; traits you will need them to have if you are going to allow them to manage your property.
DON’T forget to take a look at one or more of the properties that they currently manage. Since you are going to entrust this person with your investment, there needs to be a way for you to prove that their work is actually as great as they say it is. The best way to do this would be to ask about the sites they manage right now and make it a point to stop in and take a look. When you are looking around, ask yourself if you would feel comfortable making yourself at home there. If you cannot answer the query with a positive response, this is not the property manager you should hire.
DO find out what the fees are before moving ahead. The last thing you want is to locate the perfect management company before figuring out that the fees they are expecting are far more than you can afford. Ideally =, you should do a bit of shopping around before making your final selection. Use the fees to determine which option to select, but do not allow this to be the first thing that you take into consideration.
DON’T forget to ask about the eviction rate. If the number of people that have to be evicted is very high, this means that the person you are considering is not very careful when they are going through the screening process. They are supposed to be very careful when they are conducting background checks. This will help them determine whether the person is likely to pay on time, safe to have around others and not the type of person that you will have to worry about when it comes to property destruction.
DO make sure that there is an easy way to get in touch with them. This person has to make sure that everything runs smoothly on your property. Make sure that each candidate provides you with several ways to reach them in the event that you will need to communicate.
If you are thinking of hiring a property manager, make sure that you use the tips above. This will ensure that you find a company that you are satisfied with instead of one who leaves a lot to be desired.