Becoming a property owner is not an easy feat. There are responsibilities to uphold, expectations to meet, and risks to be taken, especially when it comes to rental property. Venturing into the real estate business and becoming a landlord like Shanna at Continental Realty means being liable not just for your property’s welfare but also your tenants’.
In other words, you will have to deal with rent collection, tenant complaints, damage repair, tax filing – the list goes on. If you don’t wish to deal with all these management tasks every day, then you might want to consider the services of a property management company.
What is a Property Management Company?
A property management company takes on your role in the oversight, control, and regulation of real estate. Property managers make decisions on your behalf, removing you from the hassles of supervising both tenants and property. With their training and experience, they generally have a knack for running your business smoothly.
Despite these advantages, however, hiring a property management company does not come for free. On average, they will charge you between 4% and 10% of your property’s monthly gross income. Are you financially prepared for such an undertaking?
Even if you are, employing property management companies is not for everyone. You might want to consider the following questions before making a decision to run your own property or to let someone else run it for you.
Do You Want to Get Involved with the Business of Rental Property?
This should be one of the first questions that you should ask yourself; the answer would determine whether or not you are up for the challenge of being a landlord. The management tasks mentioned previously are just some of the many things that concern property management. Are you prepared to handle whining tenants? Are you capable of maintaining your property on a daily basis? Are you willing to settle monthly taxes and other legal matters?
If not, then you certainly need a property manager.
Do You Know a Landlord’s Job Well?
Great businesspeople are risk-takers, and you might be one of them. You may have had entered the real estate business without really knowing the rudiments of property management. Of course, you could always learn as you go; however, mistakes such as hiring the wrong people and making wrong decisions could lead to the quick demise of your investment.
If you are not quite sure what you are doing and that you are already seeing poor results, it is best to hire a property manager to reroute your business. This is especially necessary if you are not well-versed in the everchanging laws and regulations of a state. You might end up getting entangled in some legal predicament if you continue to work blindly.
Do You Have Time to Manage Your Property?
If you have other time-consuming responsibilities aside from investing in property, know your priorities. If you think that you are not meeting your properties’ and tenants’ needs, it might be a good move to hire an outside manager to take care of rental matters for you. With this, you will not miss out on other important commitments, and your business will get the full-time attention it deserves.
Do You Live Far from Your Properties?
The farther you are from your investment property, the harder it is to manage. Tenants, for one, would have a hard time communicating their concerns if you are not physically with them most of the time. More so, it would be harder for you to deal with issues that need immediate action such as accidents and emergencies. Employing a property manager might seem best for this circumstance to quickly address, if not prevent, such issues.
Do You Own Multiple Rental Units or Properties?
Your responsibility increases with the number of units you own. This is especially true if your properties are spread in different locations. You would have to go through twice as much trouble, and you may tend to leave out other units in the process. Do not overdo yourself; this is the perfect opportunity to get a property manager to lessen your burdens and to let you focus on one thing at a time.
Guided with the questions above, it is for you to decide whether you need a property management company or not. If you do feel the need for one, ensure the credibility of the company so that your property will be safe in the hands of another, even if you are not directly managing it.