5 Advantages And 3 Disadvantages Of Hiring A Property Manager…

Hiring a property manager takes the hassle out of running your rental properties but choosing the wrong property manager could have disastrous results. Hiring a manager for your real estate investment is a personal decision. You are the only one who knows your business needs. Between maintenance repairs, showings, screenings, and rent collection, you may feel overwhelmed managing your rental properties. It could be time to consider hiring someone who is available to handle the day-to-day responsibilities (and unexpected emergencies) that come with owning rental property. If you feel it is time to hire a manager, read on to learn the pros and cons of outsourced property management.

What Does A Property Manager Do?

Property manager responsibilities include setting and collecting rent. After conducting market research, they will be able to set a fair but profitable rental price. Once the property is rented, they will be responsible for collecting rent checks. They will handle maintenance requests as property managers handle all maintenance orders, whether routine or emergency. The property manager will provide you with a monthly expense report as well as earning statements. They have the skills necessary to manage the budgetary concerns. There are a variety of laws and regulations that go along with owning rental property. The property manager can help you avoid lawsuits by making sure your property is up to date in compliance with these regulations. They conduct contracts with tenants by negotiating leases and collecting security deposits. The property manager will enforce occupancy policies and procedures by confronting violators. So, now let’s deal with the advantages or disadvantages of hiring a property manager.

The Advantages:

• Time and energy for you:  Do you have a full-time job and want to use the rental property as a source of passive income, or do you want to be heavily involved in the management of the property? Managers can handle every aspect of managing a rental property.  They will give you more time for yourself and no direct responsibility for tenant responsibility.  This will give you the peace of mind of knowing that your property is well taken care of.
• Experience in the industry: A property manager likely has years of experience managing rental property. They know the ins and outs of the market, how to price market properties effectively, and are usually able to shorten the vacancy periods of the rentals they manage. They know how to screen tenants and they’ve dealt with tenant disputes, roommate changes, lease breaks, evictions, and more. These are things that can often be overwhelming for an ordinary landlord, especially if you have never managed a property before. Property managers have also studied fair housing laws and local laws that can affect landlords and tenants. Some of these laws are very specific and without reading through all of them, one could easily break them.
• Tenant retention: People often think that once a tenant signs a lease for your property, the difficult part is over. However, that tenant isn’t going to stay forever, and at some point, you will have to find a new one. Property managers are skilled at preparing the home for rent and doing it in a timely manner. They are used to tenants leaving (even at a moment’s notice) and will be prepared to start marketing the home and getting it ready for rent once the old tenant vacates.  They are also skilled at retaining tenants. Both you as the owner and them as the managers want the tenants to be happy and feel like they are in good hands. Many property management companies use software that provides tenants with an easy to navigate site through which they can make routine requests, pay their rent, and directly communicate with their property manager.  A tenant who feels listened to is a happy tenant.  Working with a management service is one way to help them feel listened to and catered to.
• Well-credentialed vendor list: With an investment property, it is important that you work with reliable vendors. You will need electricians, plumbers, handymen, painters, and cleaning professionals. A property manager usually has a well-established network of professionals upon which they can call. Sometimes rental managers even have exclusive contracts with vendors. In today’s swiftly moving marketplace, having a property manager with the right vendor connections vendors is a great advantage.
• Helping achieve your business goals: The property manager understands the rental market.  A good property management company will have a team of people who know the rental market and know it well. They will be able to advise you on rent rates, areas that typically see better appreciation vs. cash flow, areas that don’t rent well, property taxes, and many other valuable insights you do not know. This is all information that is vital to making good investment decisions. All you need to do is tell them what you need and where you want your business to go, and they will work to help get you there.

The Disadvantages:

• Loss of control: If you are the kind of property owner who wants to have total control over every aspect of your business, hiring a property manager is certainly not the best call for you. When you hire someone else to run your rental business, you’re giving up a lot of control over how things get done. A property management company will hire its own employees, screen and approve tenants without your input, and may even make superficial changes to the property in the course of conducting maintenance or upgrades.
• Expense: For the budget conscious property owner, hiring a property manager may feel like an unnecessary expense. The biggest obstacle people see when determining if they want to hire a property manager is the cost. Property management is a paid service, and those initial dollar signs can deter people that think they can do it themselves. A property management fee might be close to 10% of your rental income, which is significant. Some companies charge property owners based on the size of the rental property, the condition of the property, and the type and location of the property.
• Finding a reliable property manager:  You’ll want to take the proper steps to make sure you’re hiring the best property manager to oversee your rental property. You wouldn’t rent your property without screening the tenant first, and you should be just as thorough in choosing your property manager. Unfortunately, not all property managers are honest or competent. If you plan to hire a property manager or a property management company, check references and the Better Business Bureau. The process in and of itself can be time consuming and confusing. But with the help of online search tools, you can find vetted and certified rental managers who offer reliable professional service.

Hiring a property manager isn’t the right choice for everyone. While property management is an expense, the pros outweigh the cons for most people. If you can afford it, your life will be less stressful, and you’ll have more time for other ventures.

Contact us (866-500-6200) for more information today!

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About Real Property Management Midwest

We are local property management experts serving Cincinnati, Dayton, Columbus, & Louisville. We manage Single-Family Homes, Apartment Buildings, and Condos. With years of experience, Real Property Management is Cincinnati, Dayton, Columbus, Louisville and Northern Kentucky’s #1 Property Management and Leasing Company.