Property Management Do's and Don'ts
There are many reasons homeowners choose to rent out their properties. Maybe you're being relocated by the military or for a job. Maybe you have started investing in properties as a form of passive income or maybe you have found yourself the beneficiary of a will that left you with a property or properties that you are not interested in living in. Regardless of how you ended up finding yourself the owner of a rental property, the bottom line is it matters how it is managed.
Ultimately, you will need to choose between two choices: becoming a landlord and handling the entire process of marketing, screening, renting, repairing, and maintaining the unit(s), as well as collecting rental payments, handling tenant disputes, and legal issues (late payments and evictions), or outsourcing this job to a professional property management company. The professionals handle everything a landlord would traditionally be responsible for; however, you maintain ownership of the property or properties and continue to enjoy passive income.
After considering all that is involved, many homeowners choose to outsource the job to a professional property management company, rather than handle the headaches than come along with being a landlord. If you've decided property management seems like the right move for you, the next thing you will need to do is find the right company to take over the reins. With your business and good name on the line, you can't afford to take this task lightly. Read on to learn some of the Do's and Don'ts regarding finding, hiring, and maintaining a positive relationship with a professional property management company.
Do Take Care to Do Your Research - When choosing the right property management company to oversee your investment properties, thoroughly vet any company you are considering before making a decision. Take care to speak with other property owners in the area for their recommendations and warnings. Furthermore, take time to visit the websites of various companies to see what types of services they offer. Lastly, be sure to read online reviews and reach out to various companies for additional information and pricing.
Don't Choose the First Company You See - Take care that you don't rush to a decision too quickly. Rather consider the implications of choosing the wrong company. Simply put, the company you choose will make or break your business. Thus, in order to keep your rental business flourishing it is important that your management team is competent and wise with all their business dealings.
Do Trust the Company You Choose - While it is important to be cautious during the vetting and hiring stages, once you've landed on a company you feel good about, it is important that you trust their judgement. Being overly involved and micromanaging your team will prevent them from doing their job, frustrate them, and cause you unnecessary stress. Rather trust the team that you so diligently researched as they are the experts in the field. Simply put, they know how to do their job to obtain maximum success, they simply don't need you hovering over them.
Don't Be Swept Away by Technology at The Expense of Experience - While technology can be helpful in nearly every avenue in life, when it comes to choosing the right property management company don't be impressed by technology alone. The bottom-line is to successfully manage properties, experience, professionalism, integrity, and responsiveness are all much more important than how advanced a company’s software is. After all, the way the day-to-day operations are carried out is what translates into a healthy cashflow. While software isn't a bad thing, it just shouldn't be the only thing that sways your decision in favor of a particular company.
Do Choose a Company with A Reputation for Responsiveness - When it comes to tenant complaints the small things are much bigger than you may have imagined. At the end of the day, your tenant is stuck living in a home with a leaky faucet, a malfunctioning oven, or a furnace noise. Thus, tenants put a high value on having a company at the helm that is responsive to their needs, communicates professionally and promptly, and takes care of their home. While it may not seem that important, keeping tenants happy will be the best way to prevent frequent turnover, saving you thousands in the long run. Thus, be sure to hire a property management company with a reputation for caring about tenant needs and be sure to give them approval to respond to necessary repair requests.
Don't Avoid Communication - As the property owner, don't make it difficult for your property management company to contact you when necessary. At the beginning of your business relationship, agree on the best way to communicate and then stick to it. In today's times most companies contact you via email or text. However, if you prefer snail mail or even a phone call, it is likely most companies will accommodate your preference.
Do Trust the Professional’s Knowledge Regarding Market Value - Every property owner wants to get the most out of their rental and this may be weighing on you even more heavily if you've chosen to go with a property management company. Despite this, overpricing your property can backfire and lead to an empty rental for long periods of time. This is only costing you. Thus, trust the company you hired as they are experienced in the local market and will know where to price your property to ensure quality tenants and a fair return on your investment.
Don't Make Your Property Management Company Wait - Once you've selected a company, be sure to promptly fill out any necessary paperwork and provide any additional documentation that is needed in a timely manner. Providing this information is only of benefit to you as it will help get the ball rolling, ensure you receive rent payments, and associated paperwork like tax documents.
Do Be Aware of Your Limitations - When initially considering if you should attempt being a landlord or outsourcing the job to a property management company, take a reasonable assessment of your situation. Are you ready to be fully responsible for every detail of running a rental business? It is also important to consider if you are planning to grow your business. While it may seem doable to manage one or two properties yourself, if you plan to expand your business this task will become increasingly more difficult. Thus, be honest with yourself and consider outsourcing to a property management company.
Do Give Your Property Management Company the Credit They Deserve - Remember that your property management company is there to help you and an integral part of your business's health and growth. As such work with them, treat them well, and don't be intentionally difficult. After all, a happy team helps promote a successful business!
With the right team at the helm, your business is set up for success. Consider these do’s and don’ts whenever you are hiring or maintaining an ongoing relationship with a property management company, so your business can continue to thrive!
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