Why Investors Use Residential Property Management Companies
Once you have invested in a rental property, the responsibility of maintaining the property can rapidly become overwhelming. For many homeowners, the logical resolution is to rent a Residential Property Management company to supervise their rental property. But is this decision the best for you? Here are the best reasons to consider why you should hire a residential property management company and how the benefits far out
Professional residential property management companies have systems and strategies in place to make the rent collection easy and increase and on-time rent payments. This allows you to make sure you receive fast and consistent rent collection. Swift and consistent rent collection is really hazardous in this real estate market where good cash flow can mean the difference between success and failure as a real estate investor.
Local Knowledge of Rental Rates
Property Managers have extensive local knowledge of rents and the ability to know the highest rental rate possible for your property. With the ability to do giant scale searches for rental properties, potential tenants know if your property is overpriced, even by $25. Properties that are being overpriced remain empty while other properties get rented. Knowledge of rental rates is a key factor to fast rentals and immediate cash flow.
A Professional Manager asks for a detailed written application from each adult with photo identification. Additionally, Property Manager’s will run criminal background and credit checks as well as research previous rental history to determine if the application is accurate. Property Manager’s will also call past and present employers, landlords and other references to ensure they are the best fit for your investment. Property Managers have set requirements and standards for accepting or declining an applicant and thereby ensuring you comply with fair housing rules and local and state regulations.
Property Managers have years of experience in providing best marketing to your properties so they are rented in the quickest time possible. Offline and online marketing is used by the property managers to increase your properties’ exposure and find qualified tenants as soon as possible. Most of the Property Manager’s make use of 10, 20 or even 30 different techniques to rent a property quickly which reduces your carrying cost of a vacant property.
Property Law and Regulations
Property Managers have extensive and up-to-date knowledge of property laws and regulations and will provide an assist for you in making sure you are in compliance with your local, state and federal rules and regulations. These rules and laws embrace compliance with fair housing laws, the Americans with Disabilities Act and other applicable local, state and federal laws. Just one potential law suit will would cost you any Property Management fees many times over.
Tested and Reliable Professional
Residential property management companies will already have vetted great numbers of vendors and contractors to make sure they provided good quality work at reasonable prices. Failure to properly vet these professionals may be a pricey mistake. Many times this can cost the owners more money because they do not know how to do it or because it is a time consuming and laborious process.
Property Manager perform property inspections before, during and after a tenancy. Furthermore, most Property Manager’s will perform routine property inspections at least every quarterly. Your Property Manager should be accountable for preparing frequent written inspection reports for each of your properties. This ensures that your investment is being taken care of and any potential issues are fixed before they become a costly expense!
Financial Records and Security Deposit Escrows
Property Management companies will provide income and expenses reports as well as cash statements which will save you from a bookkeeping headache. Moreover, security deposit will be managed by the property manager for your escrow funds and make sure you are in compliance with local and state regulations. Management companies will give end-of-year tax reports for your investment property’s.
Emergency Calls From Tenants
Residential property management companies will protect you from emergency maintenance calls and tenant headaches. Just imagine never having to deal with late night call from with tenants again.
A Property Manager should only be charging around 8% to 15% of the monthly rent collected. Assuming a monthly rental rate of $1200 per month that is a fee of $96 to $180 per month. This is less than $6 per day. Can you possible do all these things for less than $6 per day!
Finding the Best Tenants
As it has been stated earlier, a professional residential property management company will save you all the time and effort associated with finding tenants for your income property.
But not only that! A residential property management company will even make sure that whoever that rent your property will be the best tenant for you. A high-quality management company will have its own screening process to avoid renting out your investment property to tenants that shows no sign of responsibility and who might be a potential headache down the road.
Saving Time and Effort
One of the advantages of hiring a professional residential property management company is saving time and effort. A management company can handle all the “dirty” work related to your property investment. This includes the presumably unpleasant tasks of finding high-quality tenants, going through their applications, conducting interviews with them, and acquiring their credit reports.
Moreover, your tenants are going to be expecting you to produce variety of services additionally to the rental property that they’re staying in exchange for the monthly rent that they’re paying. Your attention will be at any cost needed at any time of the day in case the sink gets jammed or the lock brakes. As the owner of the rental property, you will be the one who will be responsible for analyzing and solving different problems whenever anything goes wrong with the property. This can be terribly time consuming and overwhelming, especially if you have another full-time job besides your real estate investing business.
A management company can handle all of these tasks – and more – for you. These professionals have the required connections to make excellent deals on home maintenance and services that you may need to manage your investment property.