What Does a Property Management Company Do?
Posted by: John Crow
Date: August 16, 2019
Posted by: John Crow
Date: August 16, 2019
When you put most of your eggs into a real estate investment property, you are making a life-altering decision. It’s true, real estate has created many wealthy people around the world, so it’s not crazy to think that managing equity is a sound investment, right?
It depends really. Are you a hands-on, or a hands-off type of person when it comes to big projects? Can you repair a drywall? Unclog drainage? Do you have time to prepare your unit so it’s ready to rent? How are you going to manage finding tenants to rent from you? Can you keep your records and reporting accurate and stay within compliance during tax season?
And that’s just the tip of the iceberg on the expectations of being a property manager. If you’re someone who is hands-offs, but loves to profit, then looking into what a property management company can do for you might be in your best interest.
So, let’s go a little deeper into what the expectations are if you’re considering taking on the management role of the investment property you purchased, over hiring a professional property management company to oversee it for you.
If you decide to go the way of acting as the landlord for your investment property, then you will be responsible to oversee the following operations:
If you must do all this for one property; imagine what managing multiple properties would look like. Aside from the demanding responsibilities you will surely be weighed down with, there are few other variables to consider before deciding on acting as your own property manager.
Are you able to juggle the time constraints of your everyday life with cumbersome, time-consuming responsibilities? Have you considered the potential health effects of being a landlord such as spiked stress levels? You will be needed at a moment’s whim if anything happens to the property. For example, imagine being called at 3 a.m. in the morning during a sweltering stretch of heat in the area because your property’s A.C. unit broke.
Another issue to consider is that, currently, you may be inexperienced. What do you know about the legal regulations of the city and state where your property will lie? How will you handle your first tenant eviction? Are your leasing agreements at risk for loopholes, or possibly non-compliant?
Finally, you may put yourself in a bind if you set your rent too high or too low compared to market standards. You could be sitting on an empty property for a long time, without any return on investment due to you overpricing yourself out from prospective renters. On the other hand, if you’re low-balling yourself, then you’re simply losing out on potential income right there.
It’s simple really. With an experienced property management company managing your investment property, you can avoid the hassle and stress that come with being a landlord – aka, make money and have less worries.
If you’re someone who is considering the more hands-off approach to equity management, then enlisting a property management company to supervise your investment should be right up your alley. So, what does a property management company do? Whether you want one task outsourced, or all operations, hiring a third-party company can help you take on the following responsibilities:
When it comes to the management of rent, there are three stages of responsibilities that need to be focused on that an experienced property management company can handle. Those include:
Another area of focus that can be enhanced with the help of a property management company is the management of the tenants who rent from you. Like with managing rent, there are a few specific areas that need to be highlighted. Those include:
When you let a property management company take the reins on governing your property, they will be required to ensure that the property is in a safe and livable condition for the tenants living there. They make sure that regular maintenance of the property is conducted and that emergency repairs are addressed as soon as the problem is known.
An example of regular maintenance to a property could be the scheduling of garbage and landscaping to pest control and HVAC checkups.
One huge benefit to hiring a property management company is when it comes to maintenance and repairs, they often have a reliable network of contractors including builders, plumbers, electricians and other skilled tradesman.
If you’re not a numbers person, and/or do not have very good project management skills, then hiring a property manager to oversee this area of your investment property might be a good idea. Because, when it comes to records and budgets, there is a lot to account for.
For example, when managing records, the property manager will oversee and audit the process for you, ensuring that the following materials are up-to-date and easily accessible. Those records should include:
Also, another benefit includes when tax season arrives. Your property management company will be able to assist you with filing your taxes on your investment property.
You won’t have to worry about city, state or national laws when it comes to the management of your investment property. The property management company you hire out can assure that all compliance is met when it comes to your assets and who it houses.
Your property manager will have extensive knowledge navigating the various laws including:
If you are considering hiring a property management company, you should see if you fit within the following circumstances beforehand:
When it comes to the management of your investment property, it makes sense to hire a professional, well-regarded property management company like Century 21 Northwest Property Management to handle the nitty-gritty of overseeing it for you. Companies like ours will be your best defense against having to deal with time-consuming maintenance activities, navigating compliance laws, communicating with tenants and much more.
Wouldn’t you rather sit back, relax and watch the equity rise on your investment(s) property then deal with the stress and hassle of being hands-on yourself?
© 2020 Centurion Investments, Inc. All rights reserved.
CENTURY 21® and the CENTURY 21 Logo are registered service marks owned by Century 21 Real Estate LLC. Centurion Investments, Inc. fully supports the principles of the Fair Housing Act and the Equal Opportunity Act. Each office is independently owned and operated. Any services or products provided by independently owned and operated franchisees are not provided by, affiliated with or related to Century 21 Real Estate LLC nor any of its affiliated companies.