The Ultimate Guide to Rental Property Management

Rental Property Management
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Rental real estate is an investment that requires proper management to maximize its profit potential. While some choose to manage these assets themselves, others choose to outsource management duties to professional third party companies. Either method can be effective but both have pros and cons, and should be based on your desired lifestyle. Rental real estate property management requires constant attention and management companies can charge anywhere between 5-15% of rent revenues for their services, so it is best to evaluate beforehand whether you can manage the responsibilities yourself or outsource.

What is Property Management?

Property management (also known as rental management) – is the comprehensive oversight of rental real estate by a third-party which includes tasks such as maintenance, operations, and marketing.

Property Management by Property Type

What is a Property Manager (PM)?

What is a Property Manager?

A Property Manager (PM) is a person whose job is to manage the daily routines of rental properties and preserve the value of the properties while generating income. Generally, property managers oversee management activities such as rent payments, repairs and maintenance, security, and general property upkeep.

Self-Manage or Hire a Property Manager?

Self-Manage or Hire a Property Manager?

The biggest question in rental property management is “Should I Self Manage my property or hire a Property Management Company?”. To arrive at the best answer for that question, all of the different variables must be considered. The type of rental property will play a big role – a single family rental home will have substantially different management needs rather than a self storage property. Other personal attributes such as the amount of free time you have along with industry knowledge, will contribute to the best answer.

Full Service vs Partial Service Property Management

Partial Service vs Full Service Property Management

In the world of rental property management, there are several structures of service agreements  offered by property management companies. The 3 most common types are: Full Service Management, Partial Service Management, and A La Carte. Each has its own sets of pros and cons, so it is best to choose the one which best aligns with your goals as a rental property owner.

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Property Management Services

Property Management Services

Property management services are all of the duties executed by property managers to successfully operate a rental property without involving the owner. Depending on the type of services quested by the property owner (e.g. full service vs. partial service vs a la carte), property management companies can oversee the entirety of a property’s operations or only one component. Each property has varying needs, however there are many overlapping services that virtually all property management companies provide, regardless of type.

Property Management Fees

Property Management Fees

How much property management companies charge and structure their fees, is one of the first questions that property owners assess when deciding on hiring a property management company. Understanding how property management fees work and the rationale behind them is a powerful concept that landlords should understand to better help plan, budget, and decide on services.

How Long Are Property Management Contracts?

How Long Are Property Management Contracts?

Most property management contracts are for 12 month terms. Some companies allow for shorter or longer contracts, but the common industry trend is for companies to require a minimum 12 month term to start, with subsequent annualized renewals thereafter. When it comes to longer term contracts or renewals, keep in mind the potential for industry changes or potential changes that you may want to make such as selling the property or transferring ownership.

Tenant Screening

Tenant Screening - RentPrep
Tenant Screening - SmartMove
Tenant Screening - Avail

Proper tenant screening is the force behind every successful rental property. When done correctly, tenant screening ensures that the landlord is getting the right tenant and the tenant is entering into a long-term relationship with a landlord who matches their expectations. The tenant screening process is usually done through a third-party tenant screening softwares that provide reports such as credit checks and criminal history.

Property Management Jobs

Property Management Jobs

For those interested in a stable, growing, and rewarding career in real estate, a job in property management can be a great choice. The world of property management is so diverse, that jobs in the field typically expose you to various other fields such as sales and leasing, financial management, personnel management, maintenance, construction, and more. Although the customer service portion of the job can be sometimes challenging, it’s stability and never-boring nature easily outweighs a few problem tenants that will inevitably come up.

Property Management Software

Property Management Software - Doorloop
Property Management Software - Appfolio
Property Management Software - Buildium

Property management software helps property owners, property managers, and tenants handle various aspects of administration such as rent payment, scheduling property maintenance, and owner reporting. Programs specifically designed to accommodate different types of rental properties’ (e.g. parking lot property management) specific needs are also available.