Being a landlord requires a lot of time, energy, and focus. You may be wondering, is a property managers fee worth it? To be a good one, you must invest time and resources into maintaining both the property and the relationships with tenants. You must be nearby to take care of regular and emergency maintenance issues, handle rent payments, and help facilitate the move-in and move-out processes. You also must be current on landlord-tenant laws to avoid legal trouble. Not to mention have the time and resources to handle all of the budgeting, accounting, and taxes.
Owning a rental property can be a lucrative investment, but it does require a lot of effort on your part- unless you hire a property manager. If you’re interested in reaping the rewards of a successful rental property but don’t have the time or resources to do it effectively, hiring a property manager may just be the solution. Here are five reasons why a property manager is worth every penny:
Property Managers Reduce Vacancy Lengths
Every day that your rental property is vacant is another day you are losing money. Vacancies, no matter how long, can significantly impact the income that your rental property generates. A property manager has the network and resources available to market your property effectively and reduce the amount of time that your home sits empty. If you are managing the property on your own, as soon as the house is vacant, you have to start at square one and begin marketing and looking for qualified tenants. Property managers, however, have a pool of interested and qualified renters at their fingertips. They are connected with people regularly who are looking for properties just like yours, which works to your advantage. This reduces vacancy lengths and helps avoid interruption in cash flow on your end.
A successful property manager will not only take care of the property but will also maintain positive relationships with tenants. This combination usually results in fewer vacancies altogether.
Property Managers Can Attract Higher Quality Tenants
There’s only one thing more expensive than an empty rental, and that’s a rental occupied by inconsiderate or problem tenants. Without proper screening and background checks, you could be opening your doors to tenants who do not pay rent on time, do not take care of your property, and cause you stress and headache in a variety of ways. Part of a property manager’s responsibility is to find high-quality tenants that have a history of paying their rent on time, taking care of their properties, and following the rules. But the screening process takes a lot of time and resources that you may not have access to. A professional property manager will know how to screen tenants that may be trying to scam you and avoid a time-consuming and costly eviction process.
Property Managers Can Reduce Maintenance Costs
A property manager acts as another set of eyes, ears, and hands-on your property when you are not around. They can perform regular inspections of your property, and be the first to spot a maintenance issue before it gets out of hand. They typically work with an in-house maintenance team and have a network of contractors that they trust to do specialized work on their rental properties. Many property managers work their maintenance fees into their monthly management fees, which means you’re not paying for every single light bulb that needs to be changed or a toilet that needs to be fixed. If the in-house maintenance team cannot perform the specific repair on your property, they typically use one of their licensed, bonded, and insured contractors that they trust to do the work. This means you do not have to spend time looking for a qualified contractor and that the contractor that they choose is qualified to do the job.
Most property managers handle more than one property, which means when it comes to contracting home repairs out, they can get a discount based on volume. These savings are typically passed down to you and can save you money on regular and emergency home repair services. Overland Management works with an extensive network of contractors and vendors in the area to ensure your property is well taken care of.
Property Managers Have A Tighter Rent Collection Process
The success of your rental property depends on the consistent cash flow that comes from the tenant. Ideally, your tenants will pay their rent on time, every time. However, sometimes collecting rent from tenants can be a process. Tenants who are consistently late with their rent can negatively impact the cash flow that your rental property generates. While we can all empathize with tenants who are struggling financially, your rental property is still a business. If you’re going to be successful, you will need to be firm and set strict expectations and boundaries when it comes to rent collection. A property manager can serve as a buffer between you and the tenant. They can enforce the rules associated with the rent, charge late fees, and can start an eviction process if necessary.
For landlords who don’t have experience working with problem tenants, or who are not local and available to handle rent disputes regularly, a property manager will make sure you get your rental income regardless of the tenant’s excuses or specific situation. If you are a rental property owner and don’t want to deal with the negotiations, excuses, delays, organizational change and legalities that come with collecting rent, a property manager is worth every penny.
Property Managers Are Worth Every Penny With Fewer Legal Problems
Another way that a property manager can save you money is by staying up-to-date on the legal issues regarding rental properties including new rent control laws. Their job is to stay current on matters regarding the Fair Housing Act, which protects tenants from discriminatory renting practices. Failure to abide by these rules can cost landlords thousands of dollars. They will also be able to keep up with any changes in the law and ensure your property, and you as a landlord, are compliant.
When it comes to taxes, a qualified property manager will be organized and knowledgeable. At tax time, it is your responsibility as a landlord to claim the right number of deductions. If you don’t, you could face penalties from local or federal tax agencies. If you do not claim the correct number of deductions, it could increase the amount of tax that you owe. A property manager can help you carefully determine which deductions to claim and keep a detailed income/expense report for your property throughout the year. If handling taxes, accounting, and budgeting is not your strong suit; it could be worth hiring a property manager just to help you with this aspect of the investment.
Hire A Cost Effective Property Manager
Hiring a property management company will typically cost you anywhere between 8% and 12% of the monthly rental value of the home, plus any additional expenses. Some property management companies charge a flat rate per month instead of basing their fees on the rental value. Either way, it can be a significant expense that landlords pay to ensure their rental property is being managed correctly.
Overland Management handles tenant screening, rent collection, accounting, budgeting, marketing, taxes, and is responsible for reducing vacancies and regular emergency maintenance repairs. We will take the stress of owning investment property off of your hands and into ours. We work hard so you don’t have to, and our expertise is worth every penny.