Buying a rental property can be a great move if you want and long-term capital growth.
But not everyone wants to be a landlord. And even if you start out wanting to do just that, you might come to the realization sooner rather than later that it isn’t all it’s cracked up to be. Tenant screening, repair requests, rent collection, and legal headaches are just a few responsibilities that landlords must shoulder.That means you should hire a
For the average property owner, especially one with multiple properties or an owner who works full-time, it might be better to bring aboard a property management firm.
A professional property management company can shoulder some or all of the landlord duties and, by doing the heavy lifting, ensure the passive rental income is truly passive.
Here are five reasons to invest in a good property manager for your rental property.
1. Enhanced Tenant Screening
The most critical aspect of buying a rental property is obtaining good tenants. A single bad tenant can cost you thousands of dollars in rental income, lawyer’s fees, and damage to your property.
Experienced property managers, meanwhile, have developed thorough screening procedures to help them do the following for their clients:
- Conduct background and credit checks
- Validate income and employment
- Check references and rental history
- Determine the likelihood of timely rent payment and long-term occupanc
Because they’ve worked with hundreds — if not thousands — of tenants, property managers know the red flags to watch out for. Their experience will reduce the risks of tenant issues and boost the odds of finding good tenants who’ll take care of your property.
2. Efficient Rent Collection and Money Handling
One of the most popular reasons property managers are used by landlords is for collecting rent. This seems straightforward, but it is not, especially if tenants are late or troublesome. A property manager will ensure that rent is paid on a regular and timely basis, late fees are charged according to the lease, overdue accounts are actively pursued, and evictions are initiated when necessary.
Most property managers also provide full financial reporting. You’ll receive regular income and expense statements, so it will be easier to know how your investment is doing. Since someone else is handling the books and collecting rent, you’ll be less likely to have cash flow issues. It’ll also be a load off your mind.
3. Time Savings and Convenience
Managing a rental property takes time, particularly if you have more than a single unit or are not in close proximity to the real estate. You can make things easier by hiring a property manager that is close to where your investment property is based.
That means you should hire a Houston-based property manager if you own units in a Houston apartment building. Finding help close to where your property is will help with tackling tenant problems, repair calls, showings, inspections, and lease renewals.
If you can’t afford to waste your time — or simply don’t wish to be on call 24/7 — a property manager offers peace of mind and allows you to benefit from the rewards of rental income without being on call at all times.
4. Legal Expertise and Risk Minimization
Landlord-tenant law is nothing to take lightly. All it’ll take is one misstep — rejecting a tenant for reasons that aren’t supported by the law — to result in costly court fights or fines. A good property manager will help prevent this sort of scenario.
It will understand fair housing laws, lease agreements, security deposit handling, and tenant rights and evictions.
A property manager will reduce the risk of legal disputes that could arise from not knowing the rules. It’ll ensure your leasing and management strategy is compliant and will protect you from liability exposure. If evictions or conflicts arise, your property manager can handle the legal paperwork and court visits for you.
5. Better Property Value and Tenant Retention
A property manager can perform regular inspections, prompt repairs, and routine maintenance. This will preserve property value and enhance it over time.
A good property manager will ensure tenants are well taken care of, and satisfied tenants renew their leases, which means the following:
- Fewer vacancies
- Less turnover cost
- More stable income
High tenant retention also keeps you away from the cost and hassle of having to constantly market your building, show apartments, and screen prospective tenants.
Although there is a fee for using a property manager, the benefits typically are worth the cost. From getting better tenants and facing fewer lawsuits, a property manager can make a big difference to your overall rental property investment strategy.
Source: Cosmo Politian
