Investing in rental properties is one of the best ways to establish wealth. Rental income is passive, which means you can continue working your full-time job while making money on the side.
Additionally, this line of investing is relatively easy to get into. You can start small and build your way up as your income grows. Eventually, you’ll be making enough from your properties that you won’t have to work anymore.
One question you need to consider, however, is whether or not you should hire a property management service. There are a lot of landlord duties and responsibilities that you’re legally bound to uphold. Furthermore, being a successful landlord means taking good care of your tenants.
A property management company can help you cover all of your bases. Keep reading for the top four benefits of hiring a property manager.
1. Property Marketing and Lease Agreements
As a property owner, you’re only earning money when you have tenants in your building. When your property sits vacant, you’re probably losing money. For example, even when you don’t have tenants, you’ll still be responsible for paying for utilities, property taxes, common area maintenance fees, and other expenses.
A property management service specializes in marketing rental units. Whether you have a residential property or a commercial property, they can help you minimize the time that these properties are vacant. This means less time that you’re losing money on your properties.
However, property managers will do more than just list your vacant unit. They will also prepare your properties for rent. After a tenant moves out, they’ll handle the cleaning and any necessary repairs.
Once the property is listed again, they’ll field potential tenants to provide unit inspections and walkthroughs. This way, you’re not taking time out of your busy schedule to provide tours for interested applicants.
One of the most important things about being a landlord is making sure you’re in compliance with your state’s landlord laws. There are a number of legalities surrounding your responsibilities as a property owner.
You’re obligated to provide your tenants with a safe, secure, and comfortable living space. As a commercial property owner, you have to provide the basic amenities for the type of business owner you’re trying to attract in accordance with the local coding laws. For example, bathrooms, heat, air conditioning, fire safety, etc.
However, you also have rights as a landlord. A property management service can help you draft a lease to cover all of your rights and the rights of your tenants. You can customize a lease agreement based on your specific unit.
2. Tenant Screening and Management
Hiring a property manager will save you a lot of time and effort when it comes to screening future tenants. Naturally, you only want qualified renters dwelling in your rental. However, most people don’t have the resources to run background checks and verify financial eligibility.
Property management services will be the go-between so you never have to worry about unqualified tenants in your rental property. People with criminal backgrounds and terrible rental histories can be a major detriment to your success as a landlord.
Additionally, tenant management is one of the most important benefits of a property manager. At any stage of their time in your unit, your tenants may have complaints, questions, or issues with paying rent.
When this happens, proper managers will step in to handle the situation. Of course, if there are any major issues, they’ll keep you in the loop. This is especially useful when managing a multi-family property.
3. Financial Management
While it’s important for you to monitor your cash flow from each of your properties, you probably don’t want to deal with the tedious bookkeeping duties on your own. A property management service will take over your books and make sure all of your tenants are paying rent on time.
This includes collecting security deposits, first and last month’s rent (if you require it at the leasing of the unit), and monthly rent. If a tenant is late on paying rent or their payment falls through, your property managers will take the necessary actions to notify the tenant.
If necessary, your property management service will handle evicting tenants that are past due on rent payments. This can save you a lot of time, stress, and unpleasantness.
Lastly, property managers can help you pay your expenses to ensure you’re keeping up with your financial obligations. This includes things like utilities and services, HOA fees, common area maintenance fees, and any other expenses you’re responsible for.
4. Maintenance and Repairs
Finally, one of the most important benefits of a property manager is that they will take care of any maintenance issues or repairs for your property. If a tenant loses power or their air conditioning stops working in the middle of summer, your property manager will handle it.
This is a major convenience for several reasons. If you still hold a full-time job or own properties outside of your immediate area, handling repairs and maintenance issues on your own might not be an option. Even locking down a repair service could take precious time out of your schedule.
By working with a property management service that provides maintenance and repair, you don’t have to worry about these types of issues when they come up. Expedient repairs will make your tenants happy, which means they’ll stick around longer. This will result in more financial security for you.
Just as importantly, working with property managers that include these types of services will save you money in the long run. Independent contractors and repair companies would charge you far more for each service call.
Should You Hire a Property Management Service?
If you are new to property ownership or are just ready to have someone else take over your landlord responsibilities, consider working with a property management service. As you can see, there are a lot of benefits to hiring property managers.
They can handle all the heavy lifting while helping you improve your reputation as a landlord. Their repair and maintenance services will also help you maintain or increase your property’s value.
Look through the rest of our blog for more property management advice, real estate tips, and home improvement suggestions. Our website was created to provide entrepreneurs like you with the information they need to become more successful.