Many people enter multi-family investments thinking it will be easy, only to quickly discover that managing collections, maintenance, complaints, and repairs can be a lot of work. When is the ideal time to hire a property management company? It is a decision many landlords face.
Entering the world of multi-family investments may seem effortless at first. However, the reality of managing collections, maintenance, complaints, and repairs can quickly reveal the true workload of a landlord. Knowing the right time to engage a property management company is a crucial decision that many landlords eventually encounter.
Do the benefits outweigh the cost? Each situation is different. We’ve compiled some points to consider before you hire a property management company.
What They Can Do:
Market the Property:
Property management companies like Faithful Home Buyers KC LLC, in Kansas City provide exceptional marketing services to showcase your property across multiple platforms. With access to top-notch online tools, your property is guaranteed to stand out in print and online listings. From strategically placing your property to managing MLS listings, scheduling showings, and streamlining application processes, they ensure maximum visibility and reach for your property.
Tenant Screening:
High-quality tenants vs. low-quality tenants can significantly impact the success of your investment—both figuratively and literally. The average person lacks the experience of a property management firm when it comes to finding the best tenants for your property. An experienced property manager can easily identify red flags from a distance.
Collect Rent:
Your property manager will collect the monthly rent on your behalf and enforce any late fees the tenant may owe. They are often paid more promptly, as private landlords tend to be more flexible. (In other words, they are more vulnerable to being taken advantage of.) A property management company can handle collections and pursue overdue rent if necessary. They can also manage most of the eviction process, which can be both time-consuming and stressful.
Raise Your ROI:
They will thoroughly assess both the living spaces and the grounds. They should be able to quickly suggest cosmetic improvements and upgrades that will enhance ROI. A skilled property manager stays informed about what competing properties offer in terms of upgrades and unique features. They should be able to provide details on taxes, including deductions and the required paperwork for the property. A skilled property manager will ensure you get the most out of your investment.
Manage Maintenance & Repairs:
Your property manager will stay on top of maintenance and handle repairs you may not even notice. Experience goes a long way here. Knowing what to look for and the most effective ways to resolve issues is a skill that develops with experience. They will gather multiple bids for repairs, ensuring your property gets the best service at the most affordable price.
Why You Need One:
You Own Many Properties:
If you own multiple properties or units, being a landlord can quickly become a full-time job. Between paperwork, vendor management, tenant needs, maintenance, and accounting, it can easily become overwhelming. A property manager is essential for effectively overseeing multiple investment properties.
Need Assistance Managing Funds:
Managing the accounting for a rental property can quickly turn into a full-time job. If you decide not to hire a property management company, it’s crucial to ensure you have a skilled accountant handling your finances. There are numerous tax deductions available to property owner.
You Are an Absentee Owner:
You can’t very well manage a property you own in MO if you live clear across the country. Relying on friends to ‘keep an eye on it’ often leads to disputes with either the tenant or your friend. It’s much wiser to hire a reputable, local property management company—someone who has your best interests in mind.
When you’re ready to hire a property management company, be aware that they typically charge 8-12% of the monthly rental income. Some people prefer to keep the money for themselves, while others recognize the tremendous value in having someone else handle the tough tasks!