If you’ve only got one or two rental properties and live close by to them, maintaining them is not really a big deal, if you’ve got the time. However, if you’ve got a few properties on the books or aren’t located anywhere near them, hiring a property management team is a necessity.
That said, you don’t necessarily want to hand over the keys to just anyone. Instead, the property manager that you hire needs to assure you that your properties are in good hands and will be cared just as carefully as if you were doing it yourself.
The following are the characteristics that the right property management firm should possess before you leave your unit in their care.
Ideally, the property management firm that you choose will have a long track record of successfully managing investment properties. The best way to find out what their experience is like is to ask a lot of questions.
For starters, what types of properties have they managed before? How many properties are they currently managing? How long have they been in the business? The answers that they give you will provide you with a much better idea of what type of experience they have and whether or not you feel they would be able to effectively manage your property.
They Visit Their Properties Often
Investment properties need to be kept tabs on regularly, which means frequent visits are warranted. The property manager who you hire should be visiting the property at least once or twice a week to make sure all is well and to be able to catch any issues before they become major problems.
For this reason, it’s important that the property management team is not so overwhelmed with properties that they don’t have the time to make such frequent visits. At the very least, their staff should be adequate enough to cover all the properties that they have on the books so that you are able to receive the personal touch that your property requires.
They Know How to Effectively Market Rental Units
Hopefully, your unit won’t experience a high turnover rate that leaves you scrambling to find a new tenant often. That said, you should still expect to have to deal with vacancies from time to time, which means you will be depending on effective marketing tactics to ensure the unit is filled in a reasonable amount of time. The longer the unit sits vacant, the more money it will cost you.
Part of the many tasks that property managers are responsible for is filling vacant units, which means they need to market the property effectively to attract the right tenants. In addition to marketing on various platforms, the property should be presented in an attractive light. That means quality photos should be taken, an attractive description should be drafted, and the posted rental rate should reflect the current market. A successful property management team will be able to tackle these tasks with little issue.
They Make Use of Current Technology
These days, a big part of the success of property management is making use of innovative software. Not only does technology make the job of the property manager easier, it also makes it more effective.
Plenty of tasks can be simplified and streamlined with the use of technology, including collecting rent, marketing vacant properties, requesting maintenance and repairs, and so forth. Renters themselves can communicate with property managers digitally, making it much easier and faster to have questions answered. Renters certainly appreciate that, especially the technologically savvy millennial generation.
Their Fees Are Fair
The fees associated with property management is fairly standard across the board. That said, it’s still a good idea to compare rates with other property management firms to make sure what you are quoted is reasonable and falls in line with the industry standard. Generally speaking, property management companies charge somewhere around 10% of the monthly rent. The rate can fluctuate slightly in either direction depending on the type and size of the property.
There are also extra fees that you may be asked to cover, such as lease renewal fees, maintenance costs, tenant finder fees, and others. Your best bet is to find out what extra fees you will be charged for on top of the regular management fee so you’re aware of how much it will cost you to have your property managed by a third party.
Their Renters Are Happy
A good way to gauge how well your investment property will be managed is to see how satisfied the residents of some of the properties that they currently manage are. If the tenants are happy, the property management team most likely is treating them fairly and taking good care of the property.
The quality of the tenants also speaks volumes about how good the property management firm is at their job. Finding good quality tenants is a critical component to a successful investment property. They’re much easier to deal with and are more likely to pay their rent on time.
Bad tenants, on the other hand, can be a real nightmare to handle and can end up being costly. If the property manager is able to find solid tenants for other investment properties that they manage, they’ll be more likely to find good ones for you too.
The Bottom Line
Managing an investment property is a big deal and requires plenty of time and effort to ensure everything runs smoothly. From marketing a vacant unit, to collecting rent checks, to dealing with tenants inquiries, owning and running a rental unit can be a hassle.
Luckily, you can hire property managers to deal with all of that work for you, especially if you’re nowhere near the property, or if you simply don’t have the time nor the desire to do so on your own. But before you pick a property management company, do your due diligence to make sure you select the right one. Looking for the above traits can help you pick the ideal firm that will leave you with some peace of mind knowing that your unit is in good hands.