Property management is a recently growing sector of the real estate business. However, what exactly should a property manager do? Who actually needs or could benefit from the services a property manager offers? Are these benefits worth the expense?
These are common questions that property owners and investors often ask and seldom receive a straight forward answer.
Here is a quick list and comparison to help those of you which may be considering the service.
A property manager is a representative for the owner who assumes the roll of the landlord. In short the property manager will complete any and all duties that the owner / investor and the property manager agree upon (usually in writing in a “property management agreement”). Common duties are:
Collecting Rent, supervising repairs, answering tenant questions and concerns, move in and move out inspections, making payments on behalf of the landlord, delivering three day notice of eviction, and any other duty agreed upon.
Tenant acquisition services are also available.
So who needs these services why not do them yourself? Property management is an excellent option for absentee owners, those with very busy work schedules or family schedules, in short anyone who is not using rental income as the primary source of income and instead as an investment or passive income. Investors are investors not property managers.
What is the expense and is it worth it? The expense can be anywhere from a specified percentage of the rent collect (typically about 8%) to a flat fee of $50.00, $75.00 or $100.00 monthly. Most property managers will set their fee based on the duties expected to be completed.