You have decided to rent out your property. Now, you need to decide whether you will try to manage it yourself or hire a property management company to do the work for you. Some property owners have the time and flexibility to be very hands-on, but many do not. The costs of hiring a property manager may seem high, but the costs of poor management are even greater, leading to loss of valuable time, resources, and money. A good property manager can be worth their weight in gold. Let’s take a look at six ways a great management company can help see you the greatest return on your investment.
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TENANT SCREENING
It is definitely possible to get a bad tenant out of your rental once they are in, but it can be a huge and expensive hassle. It’s better not to have rented to them in the first place. A property manager can effectively screen candidates, weeding out those with a poor rental history. They use their experience and resources to perform background checks, including information on credit history, criminal records, bankruptcies and evictions, alerting them to any red flags. They also help you avoid rental scams directed towards property owners and avoid discrimination lawsuits which stem from an inconsistent screening process.
TENANT/LANDLORD MEDIATION
When landlords develop a relationship with their tenants, they may find it hard to collect late rent, mediate disputes, or evict someone from their property. Failing to collect tenant rent on time can mean the difference between success and failure for a landlord. Collecting rent on time every month brings a steady cash flow and should be non-negotiable with your tenants. A property manager acts as a buffer between you and your tenants, enforcing the rules and lease terms without involving you directly.
AVOID LEGAL ISSUES
A property management company will be familiar with the local, state and federal fair housing laws regarding tenant/landlord relations. They will keep you out of legal trouble and free of tenant lawsuits. Failing to make repairs in a timely manner or discrepancies in returning security deposits can lead to fines, lawsuits and other legal issues. Having your legal bases covered is a compelling reason to consider hiring a property management company.
SHORTER VACANCY CYCLES
Property managers can effectively market your property. They will determine the best rental rate as compared with other similar properties through local market knowledge and rental rate tools. If your property is priced too high, you lose money waiting to fill the vacancy. If the price is too low, you lose money every month the tenants are in the unit. Good property managers will maximize revenue and minimize time spent filling vacancies.
LOWER MAINTENANCE COSTS
They handle all repairs, saving you time and money in hiring your own contractors or repairmen. They make sure the process is done efficiently and cost-effectively, often employing their own reliable contractors. Most companies have an on call 24-hour service to take care of tenant problems, freeing you from having to respond to a call about broken pipes in the middle of a winter night.
MORE TIME, LESS STRESS
Your time is valuable. Property management companies take the time, stress and hassle out of the rental process, leaving you to pursue other entrepreneurial pursuits rather than chasing down rent or responding to tenant complaints. Choose a management company wisely. Look at their background in management and customer relations. Get references from other property owners. Choosing a great property management company will save you time, stress and ultimately money!
