Everyone knows that owning a property can be a great investment that does not entail too much of a risk. Even if you are not planning to use the property yourself, it can generate income for you if you rent it out to tenants. However, the process of finding good trustworthy tenants and maintaining your property to be in the best condition possible is quite tiresome, especially if you have other businesses or work that takes up a lot of your time. Luckily, there are property management companies out there that are more than willing to take on your property and manage everything from A to Z so all you have to worry about is what you are going to be spending the extra income you are getting monthly on. There are tons of benefits that you get when hiring a property management company.
What is Property Management Company?
Property management is the daily supervision of residential, commercial, or industrial real estate by a third-party contractor. Property management can also refer to facility management. In most cases, the day-to-day repairs, ongoing maintenance, and upkeep, as well as the safety and protection of the properties, fall under the purview of the property manager. The majority of the time, they are employed by the proprietors of investment properties such as apartment and condominium complexes, private home communities, shopping centers, and industrial parks.
Their primary responsibilities are to handle the day-to-day responsibilities that are delegated to them by the property owners, as well as to protect the value of the properties that they manage while simultaneously generating income from those properties.
Benefits of Hiring a Property Management Company
1. Saves Time
As mentioned above, the different tasks that are required to properly manage any kind of property, whether it is a residential or a commercial one, can take up a lot of time from your busy life. Going through the hassle of personally being available to tenants almost all the time for any issues including the most minimal ones can be extremely frustrating, not to mention really time-consuming. Ooi Kee Liang suggests that having a third party managing your property for you will ensure that your tenants have someone to report everything to without wasting your own time in the process.
2. Ensures Reliable Tenants
Finding reliable tenants can be difficult, especially if you have certain conditions that need to be met to rent out the property. Hiring a company to sift through the different applicants and finding the right tenants will make the entire process much faster. Because of the various forms and surveys that a management company makes tenants fill in before they are accepted, you are going to get reliable tenants who will not cause you trouble when paying rent or when the tenancy contract is up and they need to leave.
3. Better Quality Maintenance
Another benefit you get when you hire a property management company is you get better maintenance for your property. Most, if not all, good property management companies have deals with general contractors and different maintenance professionals in the area they are in. It is important that before you settle for a company, you need to start looking up different management companies around your area using a simple online search. Searching specifically for a Perth property management company, rather than not mentioning any area at all in your query, can lead to more reliable results which you can then easily go through. This will ensure that the different contacts they offer to provide maintenance for your property are available to you. Not only will this save you a ton of time trying to find a good contractor to finish the task, but it will also save you a lot of money because of discounts and deals offered by the management business you are associating with.
4. Consistent Rent Collection
Instead of having to deal with tenants one on one and basically running after them to get your rent each month, hiring a property manager will make the entire process more effective and efficient. It will guarantee that by a certain day all your rent will be deposited directly for you into your account. This creates stability and removes a lot of the stress associated with renting out properties to tenants. Likewise, if the tenants miss out on paying rent, then the company is going to handle the eviction process professionally from start to finish.
5. Professional Marketing
A great benefit that you get from a well-established property management company is professional marketing. These companies have the resources and finances needed to properly market your property for you. This can make a really big difference in how well your rentals are doing. You should keep in mind whether it’s going to have the right resources to add to your property’s value through marketing when choosing a company to help you manage your real estate. This will also affect the periods of vacancy that your property will have. Since your property will be marketed before the current tenants’ contract is completely up, you can have new tenants lining up to move in as soon as possible.
6. Fewer Legal Issues That Are Both Expensive and Time-Consuming to Resolve
Landlords who have been in the business for a while are aware that it only takes one difficult tenant to cause significant legal and financial headaches. A reliable property manager is up to date on all of the laws that apply to landlords and tenants, and they will watch out for you to make sure that you are not leaving yourself open to the possibility of being sued. Every state and municipality has its own set of laws, and together with federal law, these laws cover a wide range of topics, including, but not limited to the following:
- Tenant screening
- Safety and property conditions of the property
- Evictions
- Inspections
- Lease addendums
- Terminating leases
- Handling security deposits
- Rent collection
You can save yourself time, money, and mental anguish by avoiding even one lawsuit, which can more than pay for the property management fees.
7. Shorter Vacancy Cycles
A property manager can assist you in performing three essential tasks that have a direct impact on the amount of time it takes to fill vacancies in your rental properties:
- Make necessary repairs and get the property ready for rental – A property manager is responsible for suggesting and supervising any cosmetic improvements that will increase revenue.
- Determine the most appropriate monthly rental fee – If you set the rent too high, you will have to wait, but if you set it too low, you will lose money each month that the tenant is in the unit. Knowledge of the local market, information on recently sold comparable properties, and access to rental rate analysis tools are required to determine the optimal price.
- Make sure that your property is effectively marketed – An experienced property management company will have written hundreds of ads in their time and will know what to say and where to advertise to attract a larger candidate pool in a shorter amount of time. In addition to this, due to the volume of their business, they are typically able to negotiate lower rates for advertising both online and offline. Last but not least, they have experience in sales and can make a sale when they answer calls from potential customers or accompany them on showings.
8. Better Tenant Retention
When there is a high tenant turnover rate, the most obvious negative impact is the loss of income from rent payments; however, there are other issues that are just as problematic. To complete the turnover process, the property must be meticulously cleaned, the locks must be changed, the walls must be painted, and possibly new carpet or minor repairs must be made. This is in addition to the work that must be done to market the property, show it to prospective tenants, screen them, and settle in a new tenant. This is a time-consuming and costly process that can frequently be avoided by ensuring that tenants are satisfied with the care that they receive.
A reputable property management company will have a tenant retention policy that has been tried and true over the years. This policy will ensure that your tenants are happy and will stay in your properties for a longer period. These kinds of programs call for an approach that is consistent and methodical, and this is the area in which an excellent property management company will shine.
9. Help With Regards To Taxes
A property management company can not only assist you in understanding which deductions you are eligible to claim, but they can also organize the forms and documentation that are required to make those claims on your behalf. In addition to that, the actual property management fees that you pay can be deducted from your taxable income.
10. Increase the Value of Investment
It is possible to achieve preventative maintenance by putting in place systems that can detect and address maintenance and repair issues at an early stage before these issues can develop into larger, more expensive problems. This necessitates the creation of a written maintenance check program, the creation of detailed maintenance documentation, and the scheduling of routine maintenance visits. In addition, the management company can provide you with recommendations and comments on possible enhancements and alterations, including how these changes will influence the amount of rent you can collect, as well as how they will influence the cost of ongoing maintenance and insurance.
11. Personal Benefits for Owners
- Less stress – You can avoid having to deal with emergencies in the middle of the night, chasing down rent, evicting people from your property, tenants who wreck your property, rental scams, lousy vendors, and piles of paperwork if you have a property management company.
- More freedom – You are free to live and invest wherever you want, but you will need to be physically close to the properties you own. In addition, you are free to live your life and pursue other interests without the obligation of being constantly accessible if one of your tenants has a requirement that must be met. It is irrelevant whether you live in the same state or not once you have discovered a good management company and hired them. Some landlords are located in other countries and simply wait to receive their rent checks each month; they have never set foot on the rental property.
- Free up more of your time – When it comes to making money, time is money, and for many investors, there are other ways to spend their time that are more lucrative than maintaining their properties. When you devote your attention to asset management, you are working on your company, whereas when you manage your properties, you are working within the company. In addition to this, you have more time to spend with your loved ones or friends engaging in activities that bring you joy.
Conclusion
Now that you have an idea about the different advantages of hiring a company to manage your different properties in your stead, all that is left to do is look up which company will suit your needs. If you want a hassle-free experience when renting properties out, then this is right up your alley. Not only will you save time, money, and effort, but you will also get a steady income from your properties quite easily.