Shorter vacancy cycles
An elite property management company will help you perform three critical tasks that affect how long it takes to fill your vacancies. A professional property manager will improve and prepare the property for rent. They will suggest and oversee cosmetic improvements that enhance the market rent. Determining the fair market rent requires knowledge of the local market, data on recent rental comparisons, and access to other rental rate tools.
Effectively market your property – An experienced rental agency will effectively market your rental property which will allow a larger pool of candidates in a shorter time frame. Additionally, because of their advertising volume, they can usually negotiate cheaper advertising rates both online and offline. Lastly, they have numerous other properties in their portfolio with similar market rents. Which in turn, gives rental property managers additional knowledge to rent your property quickly with fair market price.
Better tenant retention
While it’s easy to see the effects of lost rent, there are other equally serious problems with a high tenant turnover rate. The turnover process involves a thorough cleaning, changing the locks, painting the walls and possibly new carpet and/or small repairs, not to mention all the effort associated with marketing, showing, screening applications and settling in a new tenant. This is a time-consuming and expensive process that can often be averted by providing satisfaction through great customer care.
A customer service-oriented property management company will have a time-tested tenant retention policy that ensures quality tenants that stay longer. These kinds of programs require a consistent, systematic approach, which is where a good property management company will stand out among the rest.
Tighter rent collection process
The way rent collection and late payments are handled can be the difference between success and failure as a landlord. Collecting rent on time every month is non-negotiable. This is the only way to maintain consistent cash-flow. Whether you own one rental property or multiple, you now own an investment and a business. If you own rental properties as a hobby you might be in the wrong hobby. A rental property is one of the most expensive assets you could purchase and should be treated seriously.
You hired a professional agent to help you find the property, you hired a professional banker to finance the purchase, you hired a professional insurance broker to insure it, so why not hire a professional property management company to manage the daily “business” operations?
A property management company is a mediator between the owner and the tenant. They are there to make sure your business is being run efficiently. The owner avoids the daily challenges that may arise. For example, late rent, evictions, 24/7 maintenance calls, daily showings and marketing the property.
Regarding evictions, there are strict laws concerning the eviction process, and doing it wrong, or trying to evict a “professional tenant” can be a MAJOR fiasco. A good property management agency knows the law and has a good process for obtaining the best possible outcome given the circumstances. Never having to handle another eviction can be a compelling reason to consider hiring a property management company.
Lower maintenance and repair costs
A good maintenance and repairs service is required for customer satisfaction. It should be top priority to provide a comfortable living space for tenants while preserving the value of your investment. By hiring a property management firm, you gain access to both their in-house maintenance staff, as well as their network of licensed, bonded and insured contractors who have already been vetted for quality work. This can translate into significant savings compared to going through the yellow pages and hiring a handyman yourself. Not only is the firm able to get volume discounts on the work, they also know the contractors and understand maintenance issues such that they are capable of intelligently supervising the work.
Personal benefits for owners
Less stress –– Avoid having to deal with middle of the night emergencies, collecting late rent, evictions, tenants who are careless with your property, rental scams, lousy vendors, accounting and piles of paperwork.
More freedom – – Live and invest wherever you want without the constraint of needing to be near your properties. Additionally, you can live and travel without the requirement of always being available in the event that your tenants have a need you have to tend to. Once you have found a good management company, it doesn’t matter if you live in the same state. Some landlords live in other countries, and simply collect their check every month without ever seeing the property.
Free up more of your time
Time is money, and for many investors, their time can be more profitably spent in areas other than servicing their properties. When you focus on asset management, you’re working ON your business. When you manage your own properties, you’re work IN it. Additionally, you have more time to spend with family and friends while doing things you enjoy.