Owning rental property is a good investment, but it’s also a lot of work. Some landlords want to do everything themselves, while for others, hiring a property management group to take control makes more sense.
But property management can take many forms; it does not have to be an all-or-nothing decision. Duties and responsibilities can be shared. The parameters of an owner-management relationship can be customized and outlined in a property management contract. It all depends on how hands-on the landlord wants to be.
There are two types of rental property owners. First, there are those who are only interested in the investment. They may be an individual or a company with a portfolio of properties. Hiring a property management group is typically part of their business plan. The owner relies on these professionals to take charge of operating the property by finding and screening tenants, maintaining the building inside and out, collecting rent, and responding to requests and emergencies.
The other type of owner is an individual who somehow ends up with a property they don’t intend to live in. This could be a house they inherited, or the “extra” condo resulting when two homeowners decide to move in together. If they have trouble selling it or want an extra source of income, they may decide to rent it out. These owners are more likely to try managing the property themselves—at least at first.
But time is valuable, and landlords trying to do it all often find out just how much time and effort is necessary to take care of just one unit. Taking care of rental property by yourself requires people skills, knowledge of marketing, contracts, accounting, and fair housing laws, as well as maintenance skills. A landlord must also be “on call” for the tenant's needs, making it difficult to enjoy the weekends or take a vacation. And trying to do it with a family and while holding down a full-time job can be exhausting.
Other factors can make hiring a property management group a good idea, or even a necessity, such as:
Whether a landlord is feeling burned out and is ready to hand over control completely, or just needs a bit of help, hiring a property management group is often the best solution. And for owners concerned about losing decision-making power, there’s good news. The relationship with a property manager can almost always be customized to suit their needs.
Property management companies range from full-service professional agencies that are able to take over all day-to-day operations for a landlord, to small companies (or even individuals) that can fill in the gaps of service for a landlord on an as-needed basis. What a manager can offer and what the landlord needs will define the owner-management relationship.
Typical services that are offered by a property management company include:
Taking care of a rental property both inside and out involves ongoing maintenance as well as periodic repairs and handling emergencies. Property managers may be responsible for cleaning and painting vacant apartments, fixing things, replacing fixtures and appliances, taking care of common areas, landscaping, snow removal, and much more. They also need to be available at a moment’s notice for emergencies like a burst pipe or broken window.
For a single house or even a handful of rental units, a landlord might be able to make do with hiring a handyman or simply having a good network of contract workers to hire when needed. With a property management team taking responsibility for these tasks, however, a landlord can rest assured that problems will be solved without them having to get involved.
Property management professionals are experts at knowing the local rental market and how to price a house or apartment competitively. They also have the inside track on the best way to advertise and attract good tenants. These tasks can be more frustrating and time-consuming than some landlords realize.
If a landlord only needs help finding tenants, they could hire a leasing agent instead of a full-service property management company. Leasing agents handle everything up until the lease is signed, then the landlord takes over. Property management companies, on the other hand, offer more comprehensive services. They can act as the tenant’s primary point of contact throughout the entire time they live in the rental property, as well as handling maintenance, rent collection, and everything else.
Conducting background checks on prospective tenants is essential. A property management company knows what to look for and has access to the various screening services available. Most landlords are more than happy to hand off this cumbersome task.
Dealing with rent can be stressful for a property owner. Luckily, they can give a property management company the authority to handle rent collection, late fees, and raising the rent.
Hiring a property management group also saves a landlord the headaches of dealing with tenant complaints and conflicts. Property managers can enforce rules (laid out in the lease) and even begin eviction proceedings if they are necessary.
Owning and managing your own rental property requires understanding and keeping up with federal, state, and local fair housing laws. Since these are subject to change, failure to comply could make an owner vulnerable to lawsuits. On the other hand, property management companies make a point of keeping current with all statutes and laws that apply to the properties they oversee.
When landlords are tired of managing their rentals by themselves, the decision to hire a property management company is easy. But some owners are capable of (or enjoy) doing some of the work themselves. For example, a landlord might feel more comfortable finding their own books. Another might be a CPA who doesn’t mind doing the books. And another might be retired and likes keeping busy doing the maintenance.
No matter how much or how little help is needed, look for the following traits in a property manager:
In the United States, there are roughly 326,000 property management companies. No matter what type of relationship you are seeking with a property manager, you’ll be able to find it. If you want to stay involved in some of the day-to-day operations, the key is to find a property management group with complementary skills so that together, you can provide full service to your tenants.
If you are ready to share your property management responsibilities or have more questions, contact Select Leasing & Management. It could be the start of a wonderful relationship!
Cover Image by Andrea Piacquadio from Pexels by Canva.com
12851 Manchester Rd., Ste 110
St. Louis, MO, 63131
