Advantages of using a property management company includes adding value for your rental property investments.
Added value stems from the following advantages that a property management company provides to landlords:
Higher Quality Tenants
Screening tenants properly leads to higher quality tenants.
Screening tenants take up too much time and become complex for anyone inexperienced with investigating people. Too often, inadequate investigations result in bad tenants. Making matters worse, trying to evict bad tenants takes more time and becomes expensive if they refuse to leave.
The best property management companies utilize modern, high tech tenant screening processes to select tenants that:
- Rent for longer terms
- Pays rent on time
- Maintains the property
- Causes fewer problems
Prevent Potential Problems with Tenants
Preventing potential problems with tenants by using a professional property management company.
Professional property management companies learn from their experiences. Properly digging into issues regarding potential tenants raises red flags fast. These include recognizing rental scams, late payments, poor credit history, and other bad facts hidden in a person’s past.
Avoiding Legal Problems
Avoiding just one lawsuit more than pays for the hiring of a property management company.
Experienced landlords know that one bad tenant can create legal and financial headaches. Another advantage of using a professional property management company is the ability to avoid legal problems.
Knowing the laws and following them prevent lawsuits. Some examples include:
- Avoid discrimination lawsuits preventing time-consuming and costly discrimination claims by screening tenants properly.
- Maintaining properties avoids unsafe living standards. Periodical property inspections and maintenance keeps premises in safe repairs.
- Using real estate attorney approved legal agreements ensure landlord protection.
- Properly collecting and utilizing acceptable accounting procedures to handle rent and security deposits.
- Following all laws when evicting bad tenants.
Fewer Vacancy Periods
Leaving your properties vacant for too long means losing money.
An additional advantage of a property management company reduces vacancy periods. Here’s how:
- Preparing your properties to rent – Property management companies know which cosmetic improvements work best to attract new tenants.
- Determining the best rental rate – Setting yours too high takes much longer to rent, if at all. Too low and you lose money. Setting the highest rent rate without scaring potential tenants is a skill. Based upon knowledge of the current local real estate market, comparing similar units, and using modern rental rate tools.
- Effective marketing – Writing ads which attract tenants in the right media platforms brings many candidates quickly. The ability to advertise in high volumes results in lower rates from media outlets.
- Expert negotiators – Property managers know how to negotiate with tenants. Fielding phone calls from prospects, showing them the best features of a unit and answering questions. Explaining complex legal jargon in lease agreements builds trust. Negotiations go smoother using property managers.
Longer Term Tenants
Every landlord desires to rent to good tenants who stay for long periods of time.
The disadvantage of short-term tenants includes lost rent, cleaning expenses, changing locks, repainting interiors, replacing carpets, and making small repairs. Then, there is the advertising and tenant screening process costs.
Time and money saved with long-term tenants.
The best property managers have a time-tested good tenant retention policy. Yes, a systematic approach making tenants happy. Unhappy tenants tend to leave sooner than they planned.
Making a tenant happy includes providing good communication, rapid response to unit problems and quick repairs. It doesn’t hurt to remember tenant birthdays, anniversaries, and holidays with cards and even small gifts.
Rent Collection Efficiency
Efficient rent and late fees collection.
Probably, the most important service property management provides is efficient rent and late fees collection. Making sure tenants know that expecting rent on time while enforcing late fee penalties helps to ensure prompt payments.
Property managers act as a buffer between you and your tenants where some may take advantage of your friendly nature. Tenants may walk over you if you become too permissive.
Let your property manager be the “bad cop” who listens to tenant excuses, collects the rent, and handles evictions.
Property managers know how to handle evictions.
Too many landlords try suing in small claims courts and wind up facing “street lawyers” using legal tricks to skirt out of court judgments.
Strict laws must be followed in an eviction lawsuit. Doing it the wrong way leads to tenants outright winning or getting the case dismissed. Property managers hire skilled real estate lawyers who know the ins and outs of tenant evictions.
Lower Maintenance and Repair Costs
Happy tenants and landlords benefit from good maintenance.
The fewer complaints from tenants regarding appliances, floors, doors, peeling paint, run down furnishings, water heater and air conditioning problems; the better.
Property managers find and maintain good relations with competent fair priced repair persons. Also, using licensed, bonded and insured contractors. Hiring trusted workers saves you time and money from going through the yellow pages and taking your chances with strangers.
Adding Value to Your Rental Properties
Preventive maintenance increases the value of your property.
Maintaining and repairing potential problems early on avoids breakdowns leading to larger and expensive repairs or replacements. Regular maintenance checks and inspections with detailed documentation ensures that everything works.
Inspectors and maintenance checkups offer essential feedback on their condition and suggestions for modification and upgrades save more money in the long run.
Efficient record keeping keeps better track of tax deductible expenses leading to lower taxation.
Professional property managers excel at record keeping. Everyone knows that deductions require proper documentation to back them up. Feel confident that every available tax deduction from your rental properties can be supported.
Live better using a property manager.
Finally, property management provides you with the following personal advantages:
- Reduce stress – Specialists dealing with 24/7 property problems, emergency repairs, late payments, evictions, and tenant annoyances mean less stress for you.
- More free time – Property managers save you lots of time. For investors, time is money. Wouldn’t you rather spend more time doing things you love? Instead of dealing with property and tenant problems, you can virtually collect your money and enjoy life. Your family and friends will appreciate you more.
- More freedom – Hiring a property manager means you can take more vacations to anywhere you want knowing all problems will be taken care. No more worrying about inspections, tenants, and collecting rent. You can live far away from your rental properties and check your bank account monthly after receiving your regular status reports from your property manager.
To learn more about the advantages of using a property management company, Click Here
Steven Rich, MBA – Guest Blogger
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