4 Tips for Finding the Right Rental Management Company
Are you thinking about getting a property manager for your rental property? Here are some tips!
Entering the real estate investment market is daunting enough on its own. But then you are expected to not only decide on an investment strategy, but also manage it. It would be great if you could simply purchase a property and that be the end of it. However, a real estate investment requires constant management and work. Unless effectively managed, a rental investment could end up costing you a lot. A badly management rental investment is a sure-fire way to guarantee real estate failure.
Thankfully, there are professionals out there whose job it is to assist investors like you in managing your real estate assets. So, whether you own commercial or residential real estate, you will be wanting to find the right rental management company.
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Why do you need a rental management company?
You may think that having a good rental management company on your books is a waste of money, but that could not be further from the truth. There is a reason why these management companies can charge what they do, and that people will pay it. In the long run it is worth the extra investment. Chances are you have already paid big money for your rental investment, and so it is imperative that it is looked after properly.
A good rental management company will save you more than money – it will save you time and stress also. The agents that work for these companies are well trained and are likely to have more understanding of the rental market that the average homeowner. After all it is their job to deal with tenants and deal with the intricacies that come with owning a rental investment property.
The most important reason for making use of a good rental management company is explained by Bricks and Agent – to reduce stress and give yourself more freedom. Rather than worrying every day about the state of your rental property, you can leave it to the experts. The rental management company will approach you if there is something urgent. Otherwise, they are fully equipped to resolve any small issues and to deal with the day-to-day management.
What are the main benefits of using a rental management company?
There are many benefits of using a rental management company for your investment. These are highlighted below.
- Screening for tenants. A good rental manager will be able to spot the warning signs of a bad tenant a lot easier than you can. They also have a better ability to do a thorough screen of potential applicants. They know from experience what processes work best.
- Tenants will prefer to communicate to an agent. It has been found that many tenants and renters will not like needing to speak directly with their landlords when it comes to issues or payment concerns. Nolo explains that a management company can act as a good mediator. A middleman between the tenant and the landlord. Tenants tend to be more responsive when they are speaking to someone whose job it is to manage property.
Most importantly the rental management company is more experienced and knowledgeable when it comes to tenants and renters. They have the skills required to rent out a property to the highest potential, and they can offer good advice for getting the most out of your investment.
How do I find the right rental management company?
We have already established that it is extremely important to have a rental management company for your investment, but how do you find the right one for you? There are so many different companies offering seemingly similar services. So how do you choose? Roofstock discusses the main considerations.
- Understand the investment strategy you have. There are different types of rental management companies that are best for different types of investments. So first you need to determine whether you have a commercial or residential rental situation. Or do you own multiple, and require a single company to manage multiple renters? Ensure you choose a company that specializes in your specific investment type.
- Verify their licenses and certifications. License requirements vary state by state, so you will want to ensure that you choose a management company that is competent and experienced, rather than the one with the best advertisement. Look for those that are members of the National Association of Residential Property Managers (NARPM), and those that have received their Residential Management Professional (RMP) designation.
- Check reviews. In particular look for bad reviews. The best way to tell how good a rental management company is, is by how other clients rate them. Look for the biggest red flag – a lack of communication.
- Examine the property management agreement closely. This is not a time to skim over the fine print. The management company will be taking charge of what is likely your greatest asset, so you want to know everything about the agreement. Be aware of your rights and their responsibilities. If there is something included that you do not like, feel free to negotiate. This is your property, and you are in control.
Finally, once you do find a good rental management company, make sure you do check in on them every now and then to ensure that they are doing a good job. Do not assume that they will communicate everything to you automatically. They are human and sometimes might need prompting or can forget to pass on important information.
No matter what type of real estate investment you have, if you are suddenly facing the prospect of dealing with tenants, you will be wanting assistance. And this is where a good real estate management company comes in. Finding the right real estate management company for you can be half the battle, and it is important to follow all the steps to ensure that your investment is in the best of hands.
Charles is the founder of infoSpike.com. His real estate investing experience started in 2004 and he is currently focused on rental property projects. He enjoys learning about real estate investing, personal finance, and marketing. Read more about Charles here.