When you become a landlord, you are faced with the options of hiring a property management company to handle your properties, or self-managing your real estate. If you decide to take on the task alone, you will be faced with all tasks related to rent, tenants, property maintenance and repairs, business operations, and more. When you hire a property management company, you will pay a monthly percentage of your rental income to someone else responsible for filling vacancies, responding to maintenance requests, collecting rent, responsibly managing and cleaning the property, and preparing the property for new tenants.
If you decide to take the self-management route, most of your time will be consumed with the difficult aspects of rental management, including late night maintenance phone calls, missed rent payments, and challenging property repairs. Finding peaceful quiet time to yourself will become difficult. In order to diligently manage rental properties and keep tenants satisfied, you will need someone available 24 hours a day, 7 days a week. Middle-of-the-night maintenance calls, problem tenants, and missed rental payments will become frequent. If you own large properties, hiring a property manager will make business operations uncomplicated and smooth. Property management companies specialize in the day-to-day operations of rental property management, and are diligently equipped to handle rental requests and maintenance problems. Before making the decision to hire a property management company, there are numerous considerations you should contemplate to decide whether employing property managers is the correct business decision for you.
Here are the primary 7 reasons hiring a property management company is beneficial for landlords.
1. Travel Distance
When weighing the decision between enlisting a property management company to handle your properties, or self-managing your properties, consider the travel distance between your home and rental properties. Tenant and property management issues do not follow a specific time schedule. You may face multiple rental and maintenance requests in one day. Consider whether the travel distance between your home and rental properties, are worth the time and effort to constantly travel back and forth. Many rental and maintenance requests will be short-notice. Therefore, traveling or going on vacations will become stressful, considering you cannot predict when you will be required to visit your rental properties. If you value freedom, and possess other important family and work commitments, hiring a property management company will be a valuable decision. Professional property managers can take major stress from your life and allow you to unwind without the fear of maintenance emergencies and short-notice rental requests.
2. Maintenance Requests
Unless you can afford to purchase a newly built property in pristine condition, you will most likely settle on purchasing a property in need of a considerable amount of maintenance and upgrades. As your rental properties become worn down by constant tenants, the amount of maintenance requests received will skyrocket. Many landlords find constant repairs overwhelming and time-consuming, preventing them from handling other important business and marketing operations. Day-to-day maintenance requests such as lightbulb changes, leaking faucets, and broken appliances, can end up taking up your whole entire work day. Furthermore, maintenance requests come at all hours of the day, and tenants expect fast repairs. Waiting a few hours to have a leaking ceiling or broken appliance can cause major dissatisfaction in tenants, causing them to discontinue their lease renewal and/or spread negative publicity about your rental properties. Employing a property management company will give your rental property tenants an overall smoother and supreme rental experience, increasing the probability of repeat tenants and lease renewals.
3. Tenant Screening and Rental Requests
If you decide to self-manage your properties, you will quickly discover how time-consuming and frustrating the rental process can be. Missed property showings, incomplete paperwork, and tedious rental screenings will take up the majority of your time. Conducting adequate rental screenings will be a tedious and time-consuming process, that will take patience and persistence before seeing successful results. Rental screenings are necessary in order to find tenants who are responsible, reliable, and able to always pay their rent on time.
Property management companies will handle the rental requests and entire rental process, allowing you to spend time committed to other important business operations. Furthermore, property managements companies are trained and skilled in rental operation matters, and know the exact qualities to look for in potential tenants. They will take away the pressure of filling vacancies quickly, and time spent on arduous paperwork and tenant screening protocols. Since property management companies are paid by accepting a fixed percentage of your monthly rental income, you will not feel financially pressured or constrained if vacancies are not filling quickly enough.
4. Tenant Evictions and Difficult Tenants
Employing the right property management company can save you the money, headaches, and stress it takes evicting a difficult and problematic tenant. Property managers also have the time and experience necessary to properly screen tenants and only find responsible and courteous tenants, preventing the frequency of tenant evictions and burdensome issues. Managing evictions, problem tenants, and late rent payments are some of the most important tasks property managers take on which will ease your stress and workload.
5. Personal Responsibilities
Managing rental properties is often time-consuming and arduous, making personal responsibilies harder for landlords who decide to take the self-management route. In order to properly and diligently manage your rental properties, you need to evaluate what parts of life take up considerable amounts of time. If you are a full-time employee, you will not be able to devote enough time on your own to properly manage rental properties and satisfy the needs of your tenants. Hiring a property management company allows you focus on expanding your real estate portfolio rather than handling the time-draining duties associated with managing your own rental properties.
Furthermore, whether you have a large and busy family will reasonably affect your decision in hiring property managers. Making time for family is difficult when you are constantly bombarded with rental requests and maintenance requests at all hours of the day and night. Tenants expect quick responses, and not responding in a reasonably timely manner will damage your profitability and lower your lease renewal frequency. Having children or managing a successful relationship will be immensely difficult if you decide to self-manage your properties.
6. Ethics and Legal Issues
Many landlords are former homeowners who are not completely familiar with state and local laws, including fair housing laws, eviction laws, and proper lease terms. By making one small error, you can find yourself in a long and arduous legal battle. Hiring a professional property management company ensures that your rental property will be adaquately and properly handled by experienced property management professionals. You will feel more peaceful and at ease knowing your property is being cared for by seasoned property management experts, who will handle showings, evictions, and lease terms legally and correctly.
7. Property Maintenance
To successfully and properly manage a property, requires extreme diligence, hard work, and time. Property maintenance is considered the most expensive and time-consuming part of home ownership. Rental properties are even more expensive to maintain due to potential turnover rates and the occasional reckless tenant. Every time a tenant moves out, there are costs associated with the process, including cleaning, repairs, marketing and advertising, re-keying locks, screening, and more. By properly maintaining your property, you can retain quality tenants and fill vacancies quickly.
Property management companies will handle small maintenance issues quickly, ensuring your property is correctly repaired, and tenants are satisfied. You will not have to worry about canceled vacations or canceled personal commitments to fix leaky ceilings and broken appliances. Overall, hiring a property management company takes away the stress and pressure of maintaining renal properties. Furthermore, hiring a property management company to maintain your rental property financially pays off, due to your properties always looking pristine and rarely experiencing vacancies.