Owning a rental property can be a lucrative business.
As a matter of fact, real estate is still considered one of the best and safest long-term investments, especially during inflation. By purchasing a rental property, you will be able to generate ongoing passive income while increasing the value of your investment.
But, in order for your real estate to become more profitable, you need to look after it. Care and maintenance require a lot of time and effort, so this could be an overwhelming task if you have more than one property or a regular job.
That’s where a property manager comes in to take over your responsibilities and ensure your property is safe and well taken care of.
What Is a Property Manager?
A property manager is either an individual or agency specialized in handling the day-to-day operations of a rental property. It’s their responsibility to make sure everything is done according to the owner’s requirements and instructions.
The job of a property manager is to protect the property owner’s interests and act on their behalf. In many cases, property owners and real estate investors don’t have time or skills to manage their property, so they hire professionals for this job.
If you find a local property manager, you don’t have to worry about the financial aspects of renting their property, maintaining or improving its value, providing attractive living conditions for tenants, handling different issues, and complying with landlord-tenant laws.
In other words, managing a commercial or residential property is much more than signing leases and collecting rents.
What Are the Responsibilities of a Property Manager?
First of all, an experienced property manager is familiar with the segment of the real estate industry in which the rental property operates – industrial or residential.
Also, different regional and state laws have to be taken into consideration when it comes to screening tenants, handling security deposits, terminating leases, evicting tenants who fail to pay their rent, and maintaining property safety standards.
1. Setting competitive rent prices
Most landlords resort to browsing online in an attempt to determine how much others charge for a similar property.
Although this can give you an idea of the price ranges in your area, conducting thorough market research is the best way to stay competitive. For example, by opting for lower than usual rent, you will hurt your bottom line. On the other hand, a price that’s too high will result in long-term property vacancy.
A property manager knows how to hit the sweet spot by setting the rent price that will attract the right tenants and maintain a low vacancy rate.
2. Collecting rent
One of the most important things about collecting rent is to do it in a manner that optimizes cash flow. In order to be able to cover your property expenses every month, your tenants need to pay their rent on time.
A seasoned property manager will create an accounting system for collecting rent by setting a non-negotiable collection date and specifying various payment methods. These can include personal checks, cash, online payments, or certified funds.
A successful rent collection system will result in the highest percent of prompt payments with the least effort from both tenants and a property manager. A property manager also does all the dirty work and unpleasant tasks such as chasing down late payments or unpaid rents and dealing with evictions.
3. Screening tenants
Finding and screening new tenants is another important responsibility of a property manager.
You don’t want to let your property to just anybody who initially accepts to pay rent, because they might turn out to be evicted from the apartments they previously rented for unpaid rent.
That’s why your property manager will exercise due diligence by running criminal and credit background checks on every potential tenant, verifying their employment, and asking for references. An experienced professional knows how to identify red flags and sift through a number of applications in search of a reliable tenant.
Finally, if you task a property manager who knows the drill with screening tenants, you can protect yourself from discrimination lawsuits resulting from failure to comply with legal regulations during this process.
4. Managing the property
If you want your property to stay in a safe and habitable condition, it’s essential to ensure regular maintenance and repairs.
And that’s exactly what a property manager can handle seamlessly. They will oversee the work done by contractors and repair companies, inspect it, and check whether it’s up to standards and completed according to the deadline. What’s also important, a property manager can get you a much better price and save you a lot of money.
This way, you’ll keep your tenants happy and your property attractive, while eliminating all the stress of having to deal with late-night emergencies.
Running a rental property business can be daunting, so hiring a property manager can pick up the slack and handle the operations, maintenance, renting, and administration. For more resources, check out this list of great small business blogs.