Research indicates that the global property management industry has been predicted to grow at a 9.2% CAGR and may cross the $23 billion mark by 2026. While most people dream of buying a home at some point in their lives, hot real estate markets and skyrocketing property prices have led people to opt for renting over purchasing.
This has resulted in a gigantic rise in the number of people reaching out to landlords and property management companies, leading to a massive surge in rental demand.Real estate is one of the most profitable asset classes. And while renting out a property can help you build a consistent and reliable passive income source, being a landlord is not easy. In fact, it’s one of the most stressful jobs in the world.
A few of the most common challenges landlords face include late rental payments, frequent evictions, screening tenants, staying organized, and more. That being said, whether you are looking forward to renting out your residential or commercial property or vacation rental, hiring a property manager will help you save valuable time while also allowing you to oversee and manage your property effectively. This blog post lists out the most common services property managers offer.
Let’s have a look.
The 8 Most Common Services Property Managers Offer
Here’s the list:·
- Property Evaluation & Accurate Rental
- Rate Determination·
- Marketing & Advertising·
- Tenant Screening & Selection·
- Repair & Maintenance·
- Rent Collection·
- Accounting·
- Handling Any Legal Issues or Evictions·
- Property Inspection
Let’s look at each of them one-by-one.
Property Evaluation & Accurate Rental Rate Determination
First, the property manager will evaluate your property and determine an accurate rental rate based on its value and the local real estate market. One of the biggest challenges most landlords or vacation rental hosts face is determining the right rental rate. Setting it too high may scare your tenants or guests away. This may result in your property sitting on the market forever. So, it’s critical to carefully evaluate the property and determine its accurate rental rate. Property managers hold deep expertise and years of experience in the real estate sector, allowing them to set the perfect rental rate for your real estate property. Some of the most important things they take into consideration are property size, location, local real estate market, competition. Property managers will not only carefully evaluate your property but also prepare detailed documentation comprising your property's interior and exterior photos and data on rental rates in your neighborhood and the surrounding area.
Marketing & Advertising
Marketing and advertising will help you find the right tenant(s) for your property. Property managers are excellent networkers and know how and where to advertise or market a property. Not only will they use the traditional channels, but they will also harness the power of online marketing for the purpose. They will create custom-tailored ads suitable for different advertising channels. On top of this, they will work with other realtors in their network to help you find the right tenant(s). Also, property managers run numerous online and offline marketing campaigns and meet prospective tenants for showings frequently.
Tenant Screening & Selection
Finding the right tenant for your property is one of the most difficult tasks. It’s one of the major burdens landlords face, but with the right property manager, it'll be a piece of cake. Based on your preference and rules, property managers will narrow down the list of tenants and perform a background check for verifying their identity, credit history, income, and rental history. Most property managers handle dozens, if not hundreds, of such screenings every month. And they have a fool-proof refined guideline for identifying the right tenants. The potential tenants will be asked to fill a form, where they are required to fill in their required data, helping property managers make sure that they are the perfect fit based on your requirements. They'll also reach out to previous landlords to know more about a particular tenant's rental history. After these screening sessions, they will present the list of eligible candidates in front of you, and you may choose the candidates you'd like to rent out your property to.
Repair & Maintenance
Before the tenants or guests move in and after they move out, property managers will carry out a thorough property evaluation and look for any potential maintenance issues. Usually, they have a team full of experts in place to manage a property's interior or exterior. For vacation rentals, this team will make clean the property before the guests move in and after they move out. Whereas for rental commercial or residential properties, they will not only help the tenants move in and out, but they will also clean and paint the property and make the interior and exterior feel more appealing. So, you don't have to address your tenants' maintenance issues on a Sunday afternoon anymore. Your property manager will deal with those.
Rent Collection
Your property manager will reach out to tenants to collect rent on the due date. And in case the tenants fail to pay it on time, they hold the right to take strict actions against them. They may also choose to evict them. Most property management companies have dedicated software for rental collection. They'll collect the rent and charge it to your account every month. So, you don't need to head over to your tenants' place and ask them to pay their rent on time.
Accounting
Most property managers provide accounting services, which include bookkeeping, maintaining historical records, providing annual reporting, advising owners on relevant property tax deductions, sending easy-to-read cash-flow statements each month, and more. In addition to this, some of them make the mortgage, insurance, HOA dues payments on behalf of the property owners. They will also send your way detailed documentation of expenses via receipts and invoices. Keeping track of all your financial records is important, and trying to handle it all by yourself may turn out to be incredibly stressful. Property management companies have their own accounting department, which they rely on to help landlords or hosts with their accounting needs.
Handling Any Legal Issues & Evictions
Property managers deal with all the legal paperwork and also offer valuable advice in case there’s a legal dispute or litigation. Some property management companies have their own legal department, which property owners can reach out to in case of a legal dispute. Otherwise, they can always tap into their rich network and refer a qualified attorney when required. They are the local real estate experts and understand and abide by the latest enforced local, state as well as federal legislation in terms of renting out and managing rental properties. In case tenants don't pay their rent on time, they will even file the required eviction paperwork. They'll also represent the owner in the court and coordinate with law enforcement for removing the tenants as well as their belongings from the property.
Property Inspection
Property managers conduct period property inspections based on the tenants' availability. During these inspections, they'll look for any repairs required, code violations, safety hazards, and lease violations. For every inspection they perform, they send out a detailed report to the owners.
Conclusion
Managing a property all by yourself may get stressful. Dealing with those late-night or early Sunday maintenance calls, reminding tenants to pay their rent on time, handling the paperwork, and evictions may leave you both emotionally and physically drained. And the same is the case with vacation rental management as well. Being a landlord is tough - from scheduling appointments to welcoming guests to maintaining the property to handling the finances, you may find yourself spending too much time and effort. So, the best way to tackle this and turn this process a lot smoother is by hiring a property manager.