3 Huge Reasons to Use a Property Management Company
When you start the journey to become a real estate investor you have a number of decisions to make. One of the most important being about whether to use a property management company or not. You could become your own property manager and take on all the risk yourself, or you could hire a third-party company.
Alternatively, you could slop property management completely by going down the lease option route. Choosing whether to invest in a property management company is a decision that should not be taken lightly, so here we will discuss the 3 reasons why you should invest in one. Property management companies do so much more than just find tenants, they exist for the sole purpose of managing your investment.
1. They are Responsible for Finding Quality Tenants
No matter what type of real estate you are investing in, whether it be residential or commercial, one reason why you would be investing is for the rental income. Without any rental income from tenants, then there is little point of having a rental property. And finding quality tenants is easier said than done, and it can be hard to know what you are looking for in a good tenant without having prior experience. This is why so many investors will use a property management company.
It is the job of the property management company to find you the best tenants, and they do this by showing potential tenants the property, accepting applications and most importantly – completing background checks on tenants. The longer your property stays empty, the more rental income you are sacrificing. So the quicker you can find a good tenant, the better you will be.
While it is true that you do not need a property management company in order to have tenants, there is no escaping the fact that it is much easier and less risky to use one. They know the red flags to look out for, and they are able to process all the paperwork themselves. And they do more than find the tenants – they manage them throughout the life of the lease agreement and replace them when needed.
2. They are Responsible for Ongoing Management of Tenants
There is more to leasing an investment property than finding a quality tenant and having them sign a rental agreement. There is ongoing management required, and these are best done by a property management company. The rental agreement is a type of contract, and it is the rental management companies’ job to enforce that agreement. They will act when rent is late or if damage is done to the property.
They also take care of evictions and tenants that choose not to renew their lease at the end of their term. There is a lot that can go wrong when it comes to having virtual strangers living in your investment property, and so it is best to leave it to the experts to manage the ongoing complexities that comes with it. Issues with tenants can arise without notice, and it is comforting to know that the property management company is always ready to sort out any issues.
3. They Organize Repairs and Maintenance of the Rental Property
There is more to the management of a rental property than the tenants, and the property management companies will take care of all these things too. This can include repairs and maintenance (both routine and emergency), as well as being the middleman between you and any third parties, including contractors, cleaners, and technicians.
Often these rental management companies will have useful contacts and will know who the trusted repair companies are, so they can ensure that you avoid choosing the wrong tradespeople and end up doing more damage to your investment than necessary. These companies are also working 7 days a week to manage your property, so you do not need to worry about them dropping the ball if you need to go on holiday – you know that they will continue to manage your property no matter what.
By utilizing the services of a property management company, you don’t need to worry about the day-to-day issues compared to being a landlord. You’ll be able to sit back and earn mailbox money. While having a property management company on your books does come with additional costs, more often than not, these costs are more than worth and can help you avoid costly issues. If you are thinking about using property management services, then consider these 3 reasons!