Where Do Your Property Management Costs Go?
Without understanding where your property management costs go, diverting a slice of your potential revenue stream to a third party sounds unappealing. After all, the goal of any investment is to maximize its potential. However, hiring a good property manager enables you to do exactly that, while giving you the peace of mind and time to pursue other investments — in addition to enjoying the life you’ve created for yourself. To help you accomplish this, any good property management company will provide the following services:
This process entails a comprehensive inspection of your property so you have a good baseline of its condition when tenants move in and move out. With this information, you can readily evaluate the level of care they lavished upon your property during their tenancy. It also provides an assessment of what (if anything) needs to be done to get your property ready to accept tenants. During the onboarding procedures, the best property managers also gather specific insights and detailed photography so they can effectively market your property.
From crafting effective listings to scheduling and hosting showings, in addition to qualifying applicants and drawing up leases; an effective property management company handles all aspects of locating and placing the right tenants in your property. This includes background checks, credit checks and verifying employment. Once the right people are found, a good property manager conducts move-in inspections and oversees the move-in process. Exceptional property management companies also guarantee rent payments and insure you against eviction costs — going so far as to paying missed rent payments themselves and covering the outlays associated with evictions (should they become necessary).
Handling all tenant communication and coordination of all maintenance efforts also falls to the property manager. For the best companies, this includes supplying licensed, bonded and insured specialists, along with a warranty on all services provided. Effective property managers also provide you with advance notice of all work required and get your approval for all major maintenance activities. Records are kept of all maintenance requests and invoices for services rendered are made available to you immediately upon request. By the way, when tenants come home at 3 a.m. and discover they’ve locked themselves out, they call the management company, rather than you.
Performance and Expense Reports
The best property management companies track the level of interest in your property; edit listings and set showing schedules. They provide you with a ledger detailing the amount of revenue you can expect to see each month along with expenditures, so you can assess the performance of your investments — and that of the management services they provide.
A strong management effort provides feedback in real time upon your request to help you optimize the performance of your investment. They submit requests where appropriate, give you the capability to track maintenance invoices and provide you with a readily accessible method to monitor and log all communications.
In a nutshell, with a top-tier property management company, every aspect of operating your rental property is taken care of, even while you maintain direct control over all operations. You are also provided with a full accounting of all activities, income and expenses. At the end of the day, hiring a strong property management company will actually make you money rather than cost you money, as the value of the services it provides will absolutely maximize the revenue potential of your income property. If you’re thinking of contracting a company that falls short in any of these areas, you should be looking at another organization.
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