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All About Property Manager
Owning an investment real estate property means being responsible for its daily operations.
Being a real estate investor, handling the day-to-day operations could be challenging especially when you own more than one investment property or multi-unit investment property.
Taking care of lease collection, repairs, finding new tenants, keeping up with the market rent, etc are a few of the responsibilities that you need to take care of as an investment property owner.
You can hire a property manager who can take care of all these responsibilities for you. In this post, we will understand what are the roles and responsibilities of a property manager in detail.
What Is A Property Manager?
The property manager is the owner’s partner that helps in maximizing the return on investment of the property by effectively fulfilling the basic functional duties of the property.
PM helps maintain investment properties on behalf of property owners, communicate with tenants, collect rent, improve budgets, property maintenance, and keep records.
Property managers usually take care of investment properties in areas where real estate investors don’t live or don’t want to manage them personally.
Based on the needs of real estate investors, they can hire a single person or an entire management company.
The property managers would charge a fee to take care of these basic duties. The amount and method of payment depend on the asset manager’s business model.
Some managers charge a flat fee, but most commonly it is a percentage of the unit’s total monthly rent in addition to any other costs.
What Does A PM Do?
All real estate investment property has different requirements, but in general, responsibilities of the real estate managers are as follows:
- Taking care of the security deposits and arranging rental agreements
- Taking care of the maintenance requests and helping tenants to move out or move-in
- All documents management: Rental agreements, maintenance records, insurances, additional requests, etc.
- Interviewing and gaining the attention of potential tenants
- Recruitment and management of maintenance contractors when required
- Taking care of maintaining the physical condition of the property and all its units
- Collecting monthly lease and following up on unpaid lease
- Setting competitive rents to attract more tenants
- Keeping track of the budget for maintenance and repairs.
What Are The Pros And Cons Of Hiring A PM?
The Pros:
- No responsibilities for operational duties: Another major benefit of having someone else manage your property is maintenance care. Instead of doing the repairs yourself, you can rely on the building manager or their maintenance team to do the work.
- Advantages for multi-property investors: Owning multiple properties can be difficult to manage while satisfying tenants. Hiring a real estate manager can provide the work and attention your property and tenants need, even if you don’t have the time to manage it yourself.
- Freedom of investing elsewhere: One of the key benefits of working with an asset manager or management company is the ability to invest in remote properties while managing remotely without getting yourself involved.
The Cons:
- No control over your property: When you work with property managers, you have to give up direct control of your property and let them manage things for you. This will help you avoid the actual duties of property management, but it also means you can do things differently than they do.
- High Management Fees: Working with property managers has a cost associated with it. As mentioned above, several fees may be charged in exchange for the services of an asset manager. These costs may vary, but usually represent a significant portion of the total monthly rent. Before hiring one, research your asset manager to make sure it will work within your budget.
- The tenant selection process can be imprecise: Property managers are usually tasked with selecting potential tenants to live on your property. Even if there are some screening parameters to be followed, property managers can be lenient in handpicking tenants, which some landlords may think to differ.
Conclusion
Hiring a property manager to maintain your property may seem like the most logical idea. However, you might want to consider the cost of hiring one and see if it falls within your budget.
Though you might have the freedom to invest in other real estate opportunities, you might not have complete control over your real estate if you choose to hire an asset manager or a property management company.
Check with your state requirements as some states require the property managers to be licensed, while other states don’t.
