When acquiring a rental property, most prospective landlords worry about three issues: finding a suitable property in the best location within their budget, raising a down payment, and securing mortgage approval. They often forget about a vital aspect of being a landlord: the daily running of the rental property. That is because they believe managing a rental property is less stressful and wouldn’t be a problem.
These landlords often get to learn it the hard way. That is because property management can be very technical and stressful. It is one of the most difficult aspects of owning a rental property. How you approach it will determine whether your investment will be lucrative.
Landlords who manage their properties themselves often encounter several challenges, such as leasing to bad tenants, lease agreement violations, high tenant turnover rates, complaints from tenants or neighbors, late or non-payment of rent, eviction processes, liabilities, taxes, and maintenance issues.
However, working with a property management company can avoid all these issues. You may wonder how this is possible. This article will explain the benefits of hiring a property management company.
Benefits of working with a property management company
Below are some benefits of having a property management company handle the daily activities of your rental property:
1- Marketing your rental property
If your rental property stays empty, you spend money on maintenance without making any interest. The longer that happens, the more money you spend. That becomes a bigger problem if you have to pay the mortgage.
However, property managers have the necessary skills, techniques, and expertise to market a rental property. They will help you advertise your property to suitable potential tenants and fill it within the shortest possible time. As a result, your vacancy rate will also reduce. A property management company will help you to achieve this without spending too much.
2- Comprehensive Tenant Screening
It is one thing to get renters, but another thing to have quality tenants. Bad tenants can make you lose your investment. They may be non-compliant with the renter’s agreement, owe rent, pay late, damage the property, etc. But your property management company will help you avoid all these by doing a thorough tenant screening and background checks. That is because they have a vast network and the necessary tools to select high-quality renters.
The property management company will do a background check during tenant screening to know their criminal records, eviction history, references, employment status, etc. In that way, they will avoid leasing your property to bad tenants.
3- Interface with renters
Experience shows that most tenants do not like direct interactions with landlords. They prefer to deal with an intermediate party that will relate information or handle their concerns. That is why you will need the services of a property management company. Your tenants will feel at ease and less tense with this approach.
4- Handle Emergency Situations
Sometimes, your tenants may have emergency issues that require your presence at odd times. This may be an issue if you are unavailable. However, working with a property manager will ensure that tenants can always have their issues attended to when the need arises. As a result, your renters will give positive reviews about your property and even lease it for a longer term, generating more rental income for you.
5- Repairs and Maintenance
Working with a property management company will help you stay current with your scheduled maintenance and repairs. They will perform regular daily, weekly, monthly, quarterly, or annual maintenance to prevent issues and boost your property’s value. Property managers have a network of handymen, specialists, contractors, and vendors who will offer you services and products at a discounted rate because of their high volume of patronage.
6- Financial Reporting
It may be difficult to know if your rental property is making gains or losses if you don’t keep accurate financial records. Property managers are experts at keeping financial records and ensuring your investment property is profitable. Some records you may expect from your property managers include a general ledger, balance sheet, general income and expense statement, and so on. These reports will help you with your taxes and tax rebates.
7- Save more money
Some landlords may think it is expensive to work with property managers. That is because those landlords do not know the financial losses they are making because of their decisions. Property managers will help you save more money than you pay to hire them because they help lower maintenance costs, boost the property’s value, timely rent collection, tenant retention, fewer vacancies, and select quality tenants.
Working with a property management company helps you set up an efficient system for your rental property. Such systems reduce liability risks, free up your time, and expand your portfolio of investment properties.