Brenton Hayden is the founder and chairman of the board of Renters Warehouse. A Harvard Business School and MIT Sloan School of Business graduate, Brenton leads a team of over 140 employees and franchises in 21 states with a portfolio of managed properties valued at just under $1 billion.
Top 10 Reasons You Need a Property Manager
You may think because you’re in the industry you don’t need help taking care of your rental investments. Think again.
September 25, 2015
Many aspiring landlords believe that owning rental property will be a dream come true. You get to sit back and collect the rent — automatically of course — while your tenants take the utmost care of your property and look after it as though it were their own. You retire to a beach in the Caribbean, and the tenant continues to occupy the property forever.
Unfortunately though, two or three months into it all, reality comes crashing in. Instead of rent being deposited directly into your account every month, there’s the tenant who refuses to pay. And there are the three o’clock-in-the-morning phone calls alerting you to the running toilet. And of course, there’s the daunting task of trying to keep the occupancy rate higher than the vacancy rate.
Before long, the dream of being a landlord is replaced with the words “How can I escape this nightmare?”
As a real estate professional, you’re already busy. While owning rental property can be a great way to generate an additional stream of income, it’s also time-consuming, and very much a hands-on job. According to some estimates, landlords can expect to spend about four hours a week managing a rental.
Fortunately though, there’s a solution: A property manager is a great way to make life as a landlord much easier. For many time-crunched agents and brokers, this is what makes owning a rental a possibility in the first place.
If you’re a landlord, or are considering investing in a rental property, here are ten reasons that you need a property manager.
1. No More Wake-Up Calls
There’s a problem at the rental, and as the landlord, it’s your job to fix it. With a property manager, you’ll be able to say goodbye to late-night emergencies. When a problem arises, the property manager will get the call and respond accordingly.
2. Turbocharged Tenant Sourcing and Screening
Property managers have access to a wealth of resources that enable them to find new tenants faster, helping you to keep those vacancy rates down. Not only that, but they’re also able to thoroughly screen tenants. They know what to look for and what questions to ask.
3. Regular Maintenance and Repair Help
With a property manager, you don’t have to be the on-call maintenance person/gardener/pool boy anymore. Your property manager will perform routine maintenance for you, preventing small issues from getting out of control. When repairs are in order, the property manager will show up on-site at the first sign of trouble. Since they deal with this type of thing all the time, they’ll also have a database chock full of vendors and contractors who do reputable work at fair prices.
4. Avoid Messy Legal Problems
Keeping up with landlord-tenant law can be tedious and quite costly if you’re not up to speed. New regulations are constantly coming into effect, and staying out of trouble depends upon your compliance with these laws. A professional property manager should be experienced with landlord-tenant law and able to navigate the various complexities to make sure you stay on the right side of it.
5. Get the Income Balance Right on Your Properties
According to Rent.com’s 2014 Property Owner and Manager Report, 85 percent of property managers reported raising their rental rates in 2013. An experienced property manager who knows the market is familiar with that sweet spot: the amount of money that you can realistically charge without risking longer vacancy rates.
6. Keep an Eye on Your Property Without Having to Watch It
Whether you’re a long-distance landlord or just down the block, keeping a close watch on your property is important. Having a property manager means that your home will be checked on routinely. This is especially important during vacancies, as empty properties are prime targets for vandals. A property manager will be able to keep the property well-maintained, giving it a lived-in, occupied appearance.
7. Stop Being the Bad Guy
As landlord, it’s your job to enforce the terms of the lease. Unfortunately though, this is easier said than done. When a tenant brings in one too many dogs or there’s an issue with smoking indoors, things can get ugly. With a property manager, you don’t have to show up and try to reason with the tenant who’s arguing the merits of turning backyard trees into firewood. Instead, let your property manager handle it.
8. Never Hear “The Check’s in the Mail” Again
The check is always in the mail! As a property owner, you depend on the rent arriving each month on time. When this doesn’t happen, there’s often a tremendous amount of time and effort involved with tracking down the rent. Letting late rent slide can create a situation where the tenant is able to live in your property rent-free, for as long as it takes to evict them. A property manager will be your no-nonsense rent collector and will take immediate action if the rent is late. They’ll document all steps taken and remain in compliance with the law.
9. No More Dreaded Evictions
Evictions are the bane of every landlord, and understandably so. There’s a tremendous amount of red tape surrounding the lawful eviction process, and no, changing the locks while the tenant’s out just isn’t an option. A good property manager is on the ball and able to handle evictions for you — quickly, efficiently, and in compliance with state code and regulations.
10. Have the Freedom to Invest in Better Housing Markets
Finally, property managers make life easier — so much easier, in fact that you may be tempted to get yourself a few more rental properties. With a property manager, you’ll even be able to invest in properties that are out of town; since you won’t be managing them yourself, it won’t matter where you invest. This allows you to take advantage of more affordable or growing housing markets.
Owning rental property can be a great investment. But, as you can see, having a property manager can make your life so much easier. If you own rentals, but are feeling overwhelmed, do yourself a favor and look into getting a property manager to take some of the load off. You won’t regret it!