Erica Christoffer is a multimedia journalist and contributing writer and editor for REALTOR® Magazine. She can be reached at firstname.lastname@example.org.
4 Tips for Launching a Successful Property Management Business
Residential property management can be a rewarding niche—one that offers a regular paycheck, a loyal investor clientele, and access to future first-time home buyers. But before you jump in, do some careful business planning.
September 13, 2012
At the Conference— Structuring Your Business Plan to Include Property Management
Nov. 10, 2012; 1:30–3 p.m.
Also in our conference preview:
- Grow Your Financial Understanding: Know what types of loans are out there for investors and be able to determine the profitability and cash-flow ratios on rental homes. This way, you’ll be able to advise investor clients to make wise choices.
- Know the Law: Learn your state’s landlord/tenant laws. Take a class, do your own online research, and talk with experienced property managers. Take an afternoon to sit at the local courthouse, observe the landlord/tenant disputes, and take note of how the judge rules. Then apply what you’ve learned to your business plan so that every angle of tenant management is planned for.
- Establish a Base: Identify who your potential landlords are, then target your marketing to them. One approach is to pinpoint the hot rental districts in your town for advertising campaigns. Another way to find current landlords is to check county tax records. If the owner’s name and mailing address differs from the property address, chances are it’s a second home or investment property. You will also want to be prepared when other clients ask questions about becoming landlords. Have fact sheets available that identify the benefits of investing in rental property.
- Get Your Office in Order: Plan for the administrative tasks that go with managing property by establishing clear office policies (e.g., when rent is due, how you’ll handle late rent payments). Create forms and checklists needed for day-to-day office operations (application forms, lease agreements, move-in/move-out checklists). Then you’re off to a great start!