Real Estate Investing is one of the best ways to create a stream of passive income. But it doesn’t exactly live up to be as easy as it's made out to be. Managing properties come with the added responsibilities of property upkeep, repairs, tenant management, and marketing. More on that, you always have to be on call to handle the needs of your tenants. Can you justify performing all these tasks and the pressure of always being on call? If you find yourself overwhelmed with all the tasks of property management, consider asking yourself “Do I need a property management company?” If you answered yes, here are 11 Benefits of Hiring a Property Manager.
Making Sure Your Property is Rent Ready
Marketing Your Property
Screening Qualified Applicants Thoroughly
Leasing: Bringing On A New Tenant
24/7 Maintenance & Repair Request
Confronting Tenants On Tough Issues
Collecting NSF Checks and Late Rent
Serve Legal Notices/Start an Eviction
Move-out Inspection Report
Financial Accounting Reports
Starting The Process All Over Again
1) Making Sure Your Property is Rent Ready
The first step in renting out your property is making sure that your property is presentable and in a livable condition. First, your rental home will need to be thoroughly cleaned. So you have two options, you can either clean it yourself or hire a cleaning service.
Now that your rental home is clean, you will want to check if all the rooms need painting, carpet, or floorboards. A huge factor in resident retention is assuring that your rental home creates a pleasant living experience for your residents. Doing this will result in happy tenants, which means yearly lease renewals. Clean tenants tend to take good care of where they live. Addtionally, Having a clean and fresh looking home also means a "cleaner" tenant will rent the home. Cleaner tenants tend to take better care of where they live in general. Once everything on the surface level is presentable, you will want to check if the appliances in your home are in good working condition. Are they functioning properly or do they need to be replaced? Replacing appliances is your responsibility as the owner. Therefore, it is better to get the job done before it becomes a bigger issue resulting in resident complaints. Preventative maintenance is something we encourage our owners to stay on top of to save them money in the long run.
2) Powerful Marketing For Your Property
Now that your rental property is rent ready, the next step is to put your property on the market for leasing. Starting out, the best way to lease out your rental home is by using aggressive marketing resources. This includes a network of websites that we syndicate your listing with to increase the exposure of your property. Once potential tenants see your listing, you will have to respond to an overwhelming amount of rental calls of interested tenants. One of the main benefits of hiring a property manager is that we take those calls, make appoints to show the property, meet prospects in person, and accept applications. Depending on the desirability and demand of your property, the list of prospects and applicants can get pretty long.
3) Screening Qualified Applicants Thoroughly
Once you go through the list of applicants, you proceed by thoroughly screening each one. What you are looking for is to see if they're a good fit for your rental home and if they are financially qualified to pay rent. You are also looking to exclude any unlawful figures that could be a potential threat to other residents, neighbors, and/or your property.
We look at rental history and how reliably they have paid rent in the past.
Second, you want to make sure the applicant makes over three times the gross rent to assure they can comfortably afford the rent.
Third, make sure that the applicant has had no past evictions. This is to make sure that you're not leasing out your home to an unreliable tenant with a bad rental history.
Fourth, it's crucial that your applicant has no felonies within the last 10 years. The major felonies to look out for are drugs, violent crimes, and sexual-related charges. No one wants an unlawful figure living in their property.
Fifth, make sure that the applicant has no outstanding balances with utility companies. This goes back to checking out the applicant's financial history to see if they're financially reliable.
Finally, make sure that the applicant has no bankruptcies, liens, or judgments in the last 3 years. All those, if applicable, must be paid in full, if they exist.
Our screening process is to ensure that each individual applicant will be a good fit to lease your rental home. We avoid most problems with tenants by thorough scrutiny up front, saving us both many problems down the road.
4) Leasing: Bringing On A New Tenant
You won't have to execute a rental agreement, worry about adding an addendum, fill out the move-in inspection report, or collect the deposit and rent money. The rental agreement is a legal binding and ensures the rights for both the renters and landlord. A move-in inspection with documents and pictures of the rental property allows us and your residents to document the condition of the property before they move in. Doing this will set the condition in which the property should be returned. As a result, this sets the stage for a positive ongoing relationship with your resident. A move-in checklist is used to document any issues with the property and then requires the resident to sign and date the form.
5) Maintenance & Repair Requests 24/7
The maintenance and repair request side of property management is one of the biggest benefits of hiring a property manager. You won't have to worry about being on call to respond to maintenance & repair requests throughout all hours of the day. As your property manager, we'll take care of all these tasks for you. Prevention of postponed maintenance and the relating cost is another reason for property inspection. It’s important to note that not all postponed maintenance is due to a property owner’s decision to purposely defer it. Preventative maintenance is a pro-active approach to prevent damage and costly repairs. We do periodic preventative maintenance inspections can identify unknown or unreported repairs before they get worse and more costly. We contact you when repairs and regular maintenance needs to be done and get approval from you, the owner, before we proceed.
6) Confronting Tenants On Tough Issues/Enforcing The Contract
If you're in the property management business, there will come a point where you find yourself in a tough situation with a tenant. Some of the most common issues include rent collection or requesting your tenants to take better care of your property. It may also include enforcing HOA rules. It's easy to find yourself in a situation where a tenant gets defensive and things can escalate quickly. That is the last thing you want in your relationship with your tenant. Part of our service includes using professional manners when dealing with situations like these. Let the professionals handle these tough issues for you.
7) Collecting NSF Checks, Dishonored Bank Payment
No one likes being the bad guy when trying to collect late rent. A tenant's returned check or declined bank payment collection is also a difficult conversation. However, it's a task that comes along with being a property manager. You can make this process easier on yourself by having policies and procedures for bounced checks clearly outlined in your rental agreement. Doing this will give you the ease of just pointing directly to the lease and letting the NSF check clause do the heavy lifting. Another big benefit of hiring a property manager is that you won't have to worry about this.
8) Serve Legal Notices/Start An Eviction
You can be a great landlord with a great screening procedure, but even under the best circumstances, it happens. Sometimes a good tenant may struggle to pay rent every now and then. So even if you have a "good" relationship, sometimes they just won't be able to pay you. Managers realize from long experience that we do no favors in letting late rent accumulate. It is the larges expense for most renters and nearly impossible to catch up later. If that's the case, you simply can't let them stay at your property free of charge. Especially if there are other tenants who would have no trouble paying rent on time. The process of evicting a tenant seems harsh, but it's apart of the property management business. Sometimes it can be as simple as asking the tenant to leave. Other times, you will have to go through the formal eviction process. Regardless of the situation, it can be awkward or quickly escalate into something worse. As your property manager, you won't have to serve legal notices or handle evictions. Things can get out of hand quickly, therefore, legal guidance is one of the main benefits of hiring a property manager.
9) Move-out Inspection Report
Doing a move-out inspection in person with your tenant is an important part of avoiding problems with the deposit return. Performing this inspection helps us determine the condition of the property when the resident moves out. We typically schedule the walk-through on the day the resident moves out. If it’s done too early, the resident could cause damage in the last few days or during the process of moving out. Sadly, this is quite common. (For example, floors or walls can easily be damaged in the process of moving large or heavy furniture.) If we do this inspection too late, the tenants may claim the damage was not caused by them. Timing is crucial when it comes to move-out inspections and security deposit dispositions. As your true professional property management company, we make sure the timing is optimized and the required guidelines are met. We take photos of problem areas, in case there is a dispute later.
10) Financial Accounting Reports
Yes, financial reporting can seem overwhelming at times. It’s essential to be properly informed and know how to act with that information. We have an online portal so yu can see your owner account with us 24/7. During a tenancy, we keep track of your tenant's accounting, so you won't have to mail the tenant's accounting report and refund check to them. At the end of the year, we send 1099s to you for your tax filing.
11) REPEAT- Starting The Process All Over Again
You don't have to worry about the property or be shocked by its condition when you hire a professional property manager like Kim Finch Real Estate. Professional property managers are dedicated to selecting quality tenants and keeping your investment in good repair with minimal cost. We want your real estate investment to be a success, not a failure. One last benefit - your leasing and management fees are usually a tax deduction.
So there you have it, what are the reasons for managing your own rental property? Are they actually worth the headaches? These are the 11 Benefits of Hiring a Property Manager.
Contact us today to learn more about our pricing and services. Email DeAnne@kimfinchrealestate.com or call the Office 801-228-8960.
