If you own rental properties, then you know how time-consuming and stressful it can be to manage various aspects of the business. But did you know it’s possible to own rental properties without having to plunge toilets and chase down rent payments?
The key is to hire a property manager.
What is a Property Manager?
Hiring a property manager is something you’ll want to consider with care, based on your balance sheet and desired level of control.
As Investopedia explains, “A property manager is an individual or company that is hired to oversee the day-to-day operations of a unit of real estate. Property owners and real estate investors typically hire property managers when they are unwilling or unable to manage the properties themselves.”
Although property managers charge fees for their services, the cost is usually tax-deductible against the income your property generates. This makes the prospect less costly than most people are inclined to believe.
Five Benefits of Hiring a Property Manager
If you’re going to spend a chunk of your revenue on a property manager, then you’ll want it to bring a healthy ROI. Fortunately, most real estate investors have found it’s well worth the cost. Here are five specific benefits.
- Better Tenant Screening
One of the most crucial (and challenging) facets of owning a rental property is placing suitable tenants. If you’re doing this on your own, it can be difficult to find reliable people to house in your properties on a consistent basis.
But with a property manager, you don’t have to worry nearly as much about this part of your operation. Many property managers go so far as to offer guarantees.
For example, Green Residential, a Katy, Texas, property management company, provides a tenant placement guarantee by which the firm protects property owners by committing to generate rental income for its clients.
- Lower Tenant Turnover
The most expensive function when you own a rental property is the transition period between tenants. Every time a resident leaves, you have to clean the property, probably repair a few things, market the rental, accept applications, screen tenants, etc.
It’s a time-consuming endeavor. And for every day the property is vacant, you’re losing money.
Good property management companies know how to reduce tenant turnover and lower vacancy rates. They do this by onboarding good tenants and keeping them happy (so the renters are less likely to leave at the end of their lease). This saves you time, money, and frustration!
- No Surprise Phone Calls
If you’re a landlord, there’s nothing worse than sitting at home and relaxing on a Friday or Saturday night with your family – and suddenly your phone rings. It’s your tenant.
The toilet is clogged and they need assistance. So you have to tell the kids to finish the movie without you because you have to drive across town to fix the problem.
Or maybe you’re on vacation out of town and a tenant conflict develops in your duplex. Both tenants call and demand you come down and address the issue. What do you do?
When you manage your own properties, you’re the one who has to put out every little fire. But if you have a property manager, they’re the one who takes the midnight phone call. It’s a huge time saver and stress reliever.
- More Efficient Rent Collection
Rent collection can be a huge headache. Property management companies employ highly streamlined rent collection processes that remove the hassle from the equation.
In most cases, it’s automated through a digital platform so there can be no tenant excuses. Payments come in on time, month after month.
- Ability to Scale
You probably aren’t going to make it rich off one rental property investment. The key is to scale your business over time by adding more sites.
A property management company can give you the capability to scale without demanding more of your time. Theoretically, it doesn’t matter if you have one property or seven. With a property manager handling the details, your time investment will remain roughly the same.
Streamline Your Real Estate Investment
In sum, a rental property manager streamlines your real estate investment portfolio, reduces risk, and minimizes daily friction so you can spend more time enjoying your life and less worrying about the small, time-consuming details that can obsess a landlord and drive you to give up.
The key is to perform the proper research and find the right property manager to become your partner.