Being a landlord involves wearing many hats—managing finances, handling home maintenance, finding tenants, and more. As your rental property business expands, these responsibilities can become overwhelming, potentially diverting your attention from growing your real estate portfolio. This is where property managers can be invaluable. They play a crucial role in managing day-to-day operations, easing the administrative and maintenance burdens that come with owning multiple properties.
However, finding a reliable property manager can be challenging, especially for new landlords. Determining what to look for in a quality property manager is key. This article will provide insights into the role of property managers, the advantages of working with one, associated costs, and considerations for hiring and onboarding.
The Role of a Property Manager
Property managers are typically employed by real estate agencies, property management firms, or as independent consultants. Their primary responsibility is to handle the day-to-day management of rental properties on behalf of private or commercial landlords.
A property manager can handle various tasks including repairs, maintenance, rent collection, tenant relations, and administrative duties. By maintaining your property well and ensuring it is rented to qualified tenants, they can enhance its value.
Beyond these practical benefits, a property manager can offer peace of mind, allowing you to enjoy your free time knowing your property is in capable hands. They also help preserve your privacy and provide an added layer of personal security.
Not All Property Managers Are Created Equal
Investing in a reputable and professional property management company is likely to result in a positive experience. However, it’s important to recognize that not all property managers possess the same level of passion or expertise.
While it can be tempting to make a quick decision, especially when overwhelmed, it’s crucial to carefully evaluate candidates. Choosing the right property manager is essential to ensuring you receive the value and outcome you expect. We'll delve into this further later in the article.
Cost Considerations
The costs associated with property management can impact your return on investment, but the benefits may offset these expenses.
Cost structures can vary between companies, often depending on the rental price of your property. Typically, you may be invoiced for a percentage of the monthly rent when new tenants move in, along with a monthly fee that can be up to 10% of the rent or a flat rate set by the management company.
Benefits of Having a Property Manager
A skilled property manager can be invaluable, saving you time and hassle by managing all the details associated with rental property ownership, allowing you to focus on other aspects of your life.
For landlords, particularly those who don’t live near their rental properties, having someone reliable to make on-the-spot decisions is crucial. Here are some key benefits of hiring a property management company:
Tenant Screening
One of the most critical functions of a property manager is tenant screening. They perform background and credit checks to ensure that prospective tenants can pay rent and will take good care of your property. With their experience, property managers can make informed decisions about tenant suitability.
Handling Repairs and Maintenance
A property manager will address repairs and maintenance issues as they arise. They manage the process of finding contractors, negotiating responsibilities with tenants, and sourcing necessary items. Their industry contacts often ensure reliable and cost-effective work, saving you time and money.
Rent Collection
Property managers ensure that rent is collected on time each month. This can be a significant relief for landlords who have previously dealt with late or delinquent payments.
Handling Eviction Proceedings
If evictions become necessary, a property manager will handle all the proceedings. They are experienced in managing this complex and often stressful process efficiently and in accordance with legal requirements.
When to Consider Hiring a Property Manager
Consider hiring a property manager if you identify any of the following situations:
Distance from Rental Property: If you live far from your rental property or have multiple properties in different locations, managing them effectively can be challenging. A property manager can handle tasks like property showings, repairs, and inspections on your behalf.
Difficulty Finding Tenants: High vacancy rates or trouble finding qualified tenants may indicate it’s time to hire a property manager. They have the expertise and industry contacts to market your property effectively and attract reliable tenants.
Frequent Property Issues: If you frequently deal with tenant complaints or maintenance problems, a property manager can take over these responsibilities, alleviating some of your stress.
Lack of Time: If you’re unable to dedicate sufficient time to manage your property, a property manager can handle all the details for you, allowing you to focus on other priorities.
Advice for Hiring Property Managers
Choosing the right property management company is a significant decision. Here are some tips to help you find a suitable candidate:
Referrals
Seek recommendations from friends or family who own rental properties and have experience with property managers. Their insights can provide valuable context and help you identify qualities and experiences that are important to you.
Research
Conduct thorough online research to create a shortlist of potential property managers. Reading reviews and gathering information from professional research organizations can help you assess their reputation and performance.
Interviews
Meet with your shortlisted candidates to gauge their suitability. In-person meetings can reveal aspects not apparent from reviews or background information. Although hiring a property manager involves a cost, the peace of mind and time savings they provide can be well worth the investment.
If you’re contemplating hiring a property manager, it’s likely due to one or more of the issues discussed here. At Northmode we can help address these challenges so you can enjoy being a landlord without the associated stress.