Managing a property takes a ton of work.
Chances are, you already know all about that.
Now, you’re thinking about how to help ease that burden by considering a property management company.
Buying and selling property requires your presence. But with property management, you can hire a company to handle all the day-to-day tasks to keep that property running smoothly– without you needing to be there.
It’s not the only option to help make managing your properties easier (more on that later), but it is an excellent option if you’re finding property management too time-consuming or challenging.
To help you decide, below, we’ll dive into everything you need to know to answer the question, “Is a property management company right for me?”
First, let’s talk about what a property management company actually does.
What does a property management company do?
So, what services does a property management company provide?
As a landlord, you can hire a property management company to handle various tasks that allow you to step away from the day-to-day dealings of running the property.
Precisely what services said property management company provides will be listed in their contract, but here’s an example of some of the most common tasks a property management company will handle:
1. Marketing and advertising
Starting from the top, property management companies often handle the entire entry process for bringing in new leads.
That can include:
- Managing the property website
- Putting up vacant listings on property sites
- And running local ads
Exactly what is done depends on the company and what you have outlined in your contract.
So, be sure to mention if this is an important task to you that you’d like handled to make sure they’re taking care of it and how.
2. Run background checks and screen new tenants
Property management companies also typically handle the entire entry process, including screening, qualifying, and bringing in new tenants.
That can include:
- Background checks
- And leasing
Taken together, having the entire lead generation, prospect screening, and tenant welcoming process handled is a big relief, and one of the main reasons landlords typically hire a property management company.
3. Collect rent
Possibly the #1 reason to consider hiring a property management company, they’ll handle the task of collecting and chasing down rent from your tenants.
Talk about a big relief, huh?
Typically, a property management company will handle everything from managing rent payments to contacting tenants about late rent, fees, or anything else relevant.
4. Property accounting
Besides simply managing rent (as important as that is), a typical property management company will handle the rest of the property accounting, including:
- Paying vendors
- Collecting pet rent and other fees
- Bank reconciliations
- Managing the chart of accounts
5. Handle maintenance requests and repairs
Another major area that property management companies can handle is maintenance. This often includes:
- Communicating with tenants
- Creating maintenance requests
- Hiring and assigning vendors
- And paying vendors
There are two ways a prop management company can go about this: employing an in-house handyman who does most of the smaller day-to-day repairs then hire a professional for larger jobs. Or, they can hire professionals for all individual tasks.
6. Maintain the grounds
Another task they’ll often handle is cleaning units and generally maintaining the grounds as a whole, from landscaping to keeping up the outer appearance of the buildings themselves.
7. Handle tenant disputes
This might not be one of the significant areas that a management company will help you with, but it could be one of the biggest reliefs.
Tenant disputes can take an immense amount of mental energy, energy you could be using to grow your portfolio instead of feeling like you’re spinning in circles getting nothing important done.
It might have been easier just to say “everything” because it just about is.
Again, keep in mind that what tasks are handled by a particular company will depend on them. With that said, these are the tasks that most companies handle.
You might also decide that you’d prefer to handle specific tasks yourself, such as screening and leasing. It really depends on what both parties agree on.
7 Benefits of hiring a property management company
So far, we’ve covered the major tasks that a property management company handles.
Now, let’s dive a little deeper into the benefits you can expect from hiring a property management company to handle one or more of your properties.
1. Keep your units filled (with less downtime) and maximize rent
A vacant property is money leaving your pockets every day it’s empty. When you handle everything yourself, it’s challenging to stay on top of every vacant property as soon as it becomes vacant (or, better yet, make plans beforehand).
By hiring a property management company, you have a team behind you that is helping keep your units filled, filled longer, and vacant for a shorter period of time. All of that means more money in your pocket more consistently.
In fact, property management companies can often find replacement tenants before the existing one even moves out, allowing for zero downtime.
2. Save you time by responding to maintenance requests
Responding to maintenance requests is one of the most time-consuming parts of managing properties (and one of the biggest headaches). The worst part about it is that they come out of nowhere, so they make it very difficult to plan around.
If that wasn’t enough, slow responses to maintenance requests are the primary reason for lost tenants. That means you’re put between a rock and a hard place: respond quickly and make maintenance requests the priority in your schedule, or don’t and risk tenant relationships.
With a good management company on your side, maintenance is handled quickly and efficiently, and you don’t have to worry about a thing.
3. Perform a thorough screening process to improve tenant quality
The better your screening process, the better quality tenants you bring in, and the more profitable your properties are.
Professional property management companies typically have extensive screening processes, from background checks to credit checks, employment checks, rental history, and pet information.
4. Invest in geographic locations you weren’t able to previously
An oft-forgotten benefit of hiring someone for property management is that you can invest in areas that you otherwise wouldn’t be able to because it’s somewhere else geographically.
For example, if there’s a promising area out of state (or across the country), you can take advantage of the potential investment despite not living there.
By hiring a property management company, you can visit the location once to close the deal, then hire the company to handle management moving forward without you ever having to be there physically.
5. Stay on top of laws and regulations
Keeping track of the latest geographic regulations and state laws can be a truly time-consuming process.
Not to mention, not keeping up with them can land you in hot water that ends up costing you big time.
6. Better online reviews
An easily overlooked benefit of hiring a property management company is the improved reviews.
Tenants generally prefer to work with a professional property management company. That’s because they (generally) make the entire process of living at a property easier, including everything from paying rent to getting maintenance done.
What does this lead to? Better reviews online. Which, in turn, improves the quality and number of applications you receive the next time you have a vacancy.
7. No more headaches due to delinquencies and other tenant issues
Similar to maintenance issues and repairs, tenant issues can be unwelcome surprises that are both costly and time-consuming.
Whether it’s a delinquent tenant or an eviction, having a team that handles tenants issues for you can be the biggest breath of fresh air.
They can also help reduce the number of incidents upfront by providing comprehensive rental policies to tenants, so expectations are clear.
5 Things to consider before hiring a property management company
So far, we’ve talked about what a property management company does and the benefits you can expect from working with one.
The next step is to think about the reasons why you might consider working with a property management company, and reasons why you might not. Reasons specific to your situation and what a property management company can do for you.
Here are a few to think about:
- High monetary cost: The main con of hiring a prop management company is that it will cost you.
- But you save a ton of time: On the flip side, if you’re at a point where your time is more valuable than the money you’d spend, you can expect to enjoy a whole lot of time-saving opportunities.
- How many units do you have?: The more units you have, the more valuable hiring a company to help you manage will be.
- How much control do you want over how your properties are managed?:
- How close are you to your properties?: If you have one or more properties that are annoyingly far, or you’ve recently moved and now have a property that isn’t nearby, and you need to travel occasionally to handle issues related to it, this might be the perfect time to consider property management.
Do I need a property management company?
So, is it better to use a property management company, or should you do it yourself?
It all depends on you and your situation.
Hopefully, by now you’ve begun considering whether you should hire a property management company.
If you’ve considered the points above, you’re well on your way.
The main sticking point for most will be the price (con), and the main benefit would be the time saved in general (pro).
If you can justify the price, and it fits in the budget, it’s likely worth seriously considering.
If it doesn’t quite fit the budget yet, though, or you’d prefer to retain more control over how your properties are managed, you’re not out of luck.
In fact, you can utilize what countless property management companies use to help them manage their client’s properties: property management software.
Your own personal property manager, right in your pocket
With property management software, you can take advantage of several of the benefits that you typically would only get by working with a property management company.
Plus, other areas can be streamlined or simplified to make them easier to manage in general.
With a property management software like DoorLoop, you can:
- Collect rent payments automatically online
- Fill vacancies quickly with automatic listings and a professional website
- Save time by streamlining maintenance requests into one place, including communication, creation, and even paying vendors
- Simplify screening, background checks, and eLeasing all via an app
- Manage your entire business’ property accounting
- And funnel tenant communications into one single platform to save you time and headache
- Plus much more
Property management software doesn’t completely replace what a good property management company can do for you.
However, if you don’t have someone managing your properties already, it can completely transform how you do business, netting you valuable time, increasing cash flow from more consistent rent payments, and offering you peace of mind.
Not sure if it’s a fit for you?