If you’re new to the real estate investment, you may be reluctant to spend any extra money on property management. Between property taxes, insurance, and mortgage, But once you start getting the 2 a.m. Saturday night emergency calls, it will start to sound like money well spent.
So what does a property manager do for you on any given day? The short answer is: everything. And the best property management companies can actually save you money in the long run. At Great Jones, we provide best-in-class property management services to real estate investors across the U.S. Offering property management in Fort Myers to property management in Indianapolis, we have teams on the ground dedicated to making your life as an investor easy.
So how does property management work? Learn what property managers and property management companies do below!
1. Arrange Informed Renovations
A property management company can guide your choices as you improve new assets and make them ready to live in. From connecting you to the best contractors to creating a budget that will maximize your income, an experienced property manager will have the expertise to help you improve the value of your assets without overextending yourself on the budget. An expert will fully understand the responsibilities of how to manage multiple rental properties at once.
When you purchase a new home, you’re depending on the rental income to pay your mortgage, insurance, and property taxes, and still leave you with a profit. Unfortunately, the local market determines the amount you can charge for rent each month. If you spend too much on your renovations, you’ll increase the appraisal value, as well as the amount of property tax you pay each year, without collecting enough rent to make it worth your while.
2. Conduct Property Maintenance
Of course, your rental property will continue to need work even once tenants are placed. Without regular maintenance, little issues, like missing shingles or cracked masonry, can become much bigger problems. There are many benefits of using a property manager and an excellent property manager will stay on top of these repairs for you, and keep you in the loop so you know exactly where your money is going.
When it comes time to fix big-ticket items, like busted water heaters or aging air conditioners, your property management firm can contact service companies, schedule repairs, and send you estimates via text so you can approve the expenses. And because they have established a relationship with these vendors, they can get you wholesale rates on parts and discounted labor.
3. Handle Emergency Calls
When you’re the property owner, you’re responsible for responding promptly to all kinds of issues your tenant may face, whether it’s a leaky faucet or faulty outlet. And if you want to know how to be a good landlord, responding promptly is key. Sometimes, though, things require immediate action, no matter when it happens.
Luckily your property manager can be on call 24/7 to handle emergencies, no matter what the scope. If your tenant has a burst pipe, they will get it taken care of without having to wake you up in the middle of the night.
Property management teams have the staff to handle the move-out inspection, cleaning, and repairs efficiently. This will significantly reduce the cost of tenant turnover, as well as remove a ton of stress from your plate.
4. Serve as the Face of Your Business
A property management firm will handle all day to day communication with your renters. This includes everything from applications, rent collection, tenant complaints, and any other questions that come up. For larger apartment complexes, they can provide onsite managers to keep things running smoothly and ensure your vacancy rate stays low.
They’ll also handle showings, move-in, and move-out inspections, and return the security deposit to your tenant within the legal time frame. They even have the power to sign a lease for you, so you are only as involved as you want to be for your investment property.
5. Find High-Quality Tenants
Your property management team will market your property to quickly and efficiently fill vacancies on your properties. That includes everything from taking photographs, writing compelling listings, and using every available app and website to put your property in the sights of potential renters.
Through careful tenant screening, a property management company can maximize your rental income. They will follow through with personal recommendations, contact old landlords, and verify employment and income to minimize tenant turnover and prevent a costly eviction proceeding.
A property manager will put in the work to find the best potential tenant for your property. It’s in their best interest to keep your monthly rent flowing—after all, their paycheck depends on it. And it’s worth every cent to you. A bad tenant can cost you thousands of dollars in damage to your home, delinquent rent, or the cost of legal proceedings.
6. Keep Your Documents Organized
Keeping track of your paperwork is crucial to your business. This includes everything from invoices, rent payment recipes, lease agreements, and move-in inspections from your tenants. This can keep costly rent disputes at bay.
Beyond keeping your files organized, your property manager can provide you instant access to all your financial information with property management technology or software. Plus, they can send you quarterly 1099 documents to help you make your tax payments throughout the year.
Not only does this make your accounting simpler, but it can also provide key insights into your business and inform your financial decisions. Knowing exactly how much money each property is generating and how much equity you have at your disposal is key to deciding when to buy more properties.
7. Expand Your Reach
A property management company allows you to own and purchase homes to rent out in the best cities for real estate. They can connect you with an experienced local real estate agent and research neighborhood demographics to find incredible deals on properties where the potential tenant renters want to live. In fact, quite a few property management companies have a real estate agent on staff, and many of them operate in burgeoning markets across the country.
Even during a recession, real estate is a great investment that can appreciate in value while hedging your assets against inflation. As soon as you fill new rental properties with tenants, your investment starts to pay for itself. With enough research and a little luck, your property can increase in value dramatically in a few years. A property management firm can give you valuable insights into some of the best markets in the nation, regardless of where you live.
8. Grow Your Investment
Now that you’ve got someone to handle the day-to-day operations on your rental properties, you’ll have more time to focus on growth. When you work with a property management business, they can help with market research so you can analyze the cost of purchasing a new rental unit against the projected rent price you can charge.
They will know the neighborhoods that are trending upward so you can rest assured your new property will increase in value over time. They can also advise you on which properties would benefit from major renovations and help you sell off assets if you want to transition out of a specific neighborhood.
9. Keep You Protected
A property manager has the knowledge and experience to make sure you follow the letter of the law. Local regulations on tenant and landlord rights vary wildly from state to state and even from one city to the next. Lawyers are incredibly expensive, and even one lawsuit can wipe out your entire annual profit in legal fees alone. From ADA compliance to building code, a property manager can help you do your due diligence and keep you out of court.
Who Needs a Property Management Company?
Property management is beneficial for any rental property owner who wants to maximize revenue on their investment property. Even if you only own one property, they can provide you invaluable advice on growing your portfolio with your real estate equity.
If you own property in another city or state, a property management company can keep an eye on your rental unit and ensure you remain compliant with local fair housing laws and other regulations that differ from city to city and state to state. They’ll also have trustworthy contacts for quality service and repair work at a reasonable price.
Having income from a full-time job is a huge asset when you’re growing your investment portfolio. Unfortunately, if you own multiple rent houses, your nights and weekends start to disappear. A property management company can free up your time to let you relax and enjoy the benefits of all the work you’ve put into your investment.
Great Jones is Here to Help
Our property management team has helped real estate investors buy, manage, and sell thousands of properties in some of the most lucrative markets across the US. Whether you need property management in Gainesville, FL or property management in Charlotte, NC, we have teams ready to help all over the U.S. We are dedicated to placing high-quality tenants for every one of your properties, and we will handle every aspect of tenant placement, from marketing to move-out day.
The average landlord pays as much as 23% of their rental income in property management fees. We use transparent pricing, with no hidden fees, and we never upcharge for parts and labor. That means you can expect to pay as little as half of what other landlords pay for their property management service.