Whether you’ve been managing your property alone for some time or you’ve recently started, you’re likely faced with the choice of whether to continue alone or engage the services of a third party.
Both options have benefits and drawbacks and may lead to different situations. When you’re taking on the task of a direct manager in your rental operation, you can save on the management fee but this also means exchanging your time and energy for it.
Having a property manager supporting your business may cost a fee but escaping the rigors of daily management and property maintenance tasks is also worth it.
At Real Canadian Property Management, we believe that a partnership between an investor and a property management company is highly beneficial for both. Below are some of the reasons why.
Defining Property Management
Before going into the benefits of partnering with a property management company, we need to understand what a property management company is.
When talking about rental property management, it refers to having a third party take care of a rental home and its residents. Property managers are paid by rental property owners to handle its daily operation. They’re also the people renters will approach should they have concerns and issues.
Property Management Tasks
Hiring a property manager means spending a management fee, but this could be considered an investment cost. In return, property managers. Sometimes the fee becomes negligible since your income can be optimized and steady due to the skills of the property manager.
Here are some tasks that property management companies perform:
- Handling the rent collection from tenants
- Addressing concerns and catering to maintenance requests
- Communicating with delinquent tenants
- Marketing vacant rental units
- Organizing business records such as leasing agreements, receipts, and invoice
Cost of Property Management
What makes some property owners hesitate about turning over property management to another party is the cost. Management fees can differ but normally 10% is acceptable in the industry. It can range from 8 to 12% in reality. It just depends on the kind of services offered by the company.
Though it can sound a lot for some, the benefits that come along with it can’t be discounted. Property owners can pursue more investment opportunities instead of being swamped with the tedious tasks of property management.
Having a Property Management Company’s Support
A lot of property owners who have since taken the plunge to hire a property manager, never look back. For one thing, some property investors prefer a hands-off management style when dealing with rental operations.
Some also find the property management tasks time-consuming, and they may even need to learn new skills. Others are more focused on looking for more investment ventures and don’t want their time and energy to be taken.
- Property managers offer this value by performing tasks and sharing these responsibilities with the property owners:
- Marketing expertise: Compared with a first-time property owner, a property manager has greater professional marketing skills and is much more adept at attracting high-quality tenants.
- Local market knowledge: Exposed to the property management industry, property managers are able to set the right rental rate that’s optimal to the property owners and reasonable to the tenants.
- Property showings: Property managers have the free time to work out a schedule with prospective renters to view the rental unit. Long-distance landlords can enjoy this special service as they don’t have to travel far and spend a lot of money to meet the prospects and give a property tour.
- Dealing with tenants: Even if you have exemplary tenants, it still requires effort to build your communication skills and tend to them.
- Attending emergency maintenance and repairs: A large part of a property manager’s responsibility falls on property maintenance and addressing repairs. They have a team of contractors that help them achieve the goal of keeping a habitable rental for the tenants.
Benefits of Hiring a Property Management Firm
Simply stated, having professionals manage your rental investment makes a ton of difference. As your professional representative, they have more experience and skills in handling potential renters and tenants. You reduce your stress since they’ll be using effective management practices that have worked for years.
Property managers are well-versed in property laws and can apply their industry knowledge and experience to make your rental business a success. They’re also responsible for assigning the right rent price, keeping up with the maintenance work, advertising vacancies, customer service, and scouting for new prospects.
As a property investor, having a property management company working for you presents numerous advantages. This becomes even more apparent when you own several properties and have a lot of responsibilities on your hands.
In return for the monthly fee, working with property managers provides you with:
- High-quality tenants
- Shorter vacancies
- More efficient processes
- Reduction in legal conflicts
- Fewer responsibilities and stress
The Necessity of Having a Property Management Company
While the decision to hire a property manager may rest with you, here are scenarios that may make it necessary to hire one:
- Growing your rental units as part of an investment strategy.
- Being a long-distance landlord affords you little time to oversee your investment property. It’s best to have a local manager supervise your rental home.
- Actively managing your property is not your preferred way to spend your time. Treating your rental unit as a passive income means engaging the services of an external party to run the business operation for you.
Reputable property management companies provide a significant value that can end up maximizing your returns. You’re also able to access professional expertise at a small fee in the grand scheme of things.
If you have any questions or would like to take up a property management agreement with us at Real Canadian Property Management Solutions, contact us today!