Know When To Start Hiring A Property Management Company
If you’re growing your property rental business, a time will come when it gets too much for you to handle all by yourself.
The extra expense of a property management company may be unattractive when you only have a few rentals. Attending to routine maintenance calls, chasing nonpaying tenants and handling city inspections can eventually strain your personal life if not your health. You’ll have to weigh the options of continuing as a DIY Landlord and hiring employees or hiring a property management company.
When Should You Let Go of the Reins
Some property owners love dealing with the day-to-day operations of rentals, while others prefer to stick needles in their eyes. Only you will know when it’s time to get help running your real estate investments. Here are several factors that can affect your decision.
- As a DIYer, it’s almost impossible to avoid daily involvement in your business. You’re on call 24/7/365 whether you like it or not. If you don’t enjoy addressing tenant issues or hate the grind of day-to-day operations, you need to hire someone to take your place.
- Do you contract them or direct hire them? Direct hires mean payroll taxes and other headaches. Going the contractor route means less control over what they do and when.
- If you don’t live in the immediate area or your properties are out of state, you’ll need someone to handle showings, repairs, inspections and property maintenance.
- You have a day job and you can only handle your rentals after work or weekends. What happens when you have a maintenance emergency while you’re stuck at work? How much longer will your rental sit vacant losing money because you have limited time to show it?
- Ask yourself, “Am I a people person?” Some property owners don’t mind getting their hands dirty with repairs but aren’t interested in managing staff or tenants.
- How much do you enjoy tracking and recording rent payments, maintenance expenses, utility bills, etc.? If every year tax season is a nightmare for you, then it’s a good idea to hire a property manager.
- Perhaps none of the above applies to you. If your business is profitable enough and you can afford a management company, then why not? You can use your extra time to hunt out other investment opportunities or enjoy your personal time.
What a Property Manager Can Do For You
Hiring a property management company is a big step for any property owner. It means handing over your baby to a stranger. If your responsibilities have outgrown your ability to manage your rentals, it’s time to hand your rentals over to a professional manager.
- A property manager will save more than just time, they’ll help preserve your sanity. All daily operations are handled for you, rent collection being the least of them. They’ll deal with repairs, property maintenance, tenant complaints, and evictions.
- A property manager will do a market study to ensure that your rental rates are in line with other rentals in the area.
- How often do you raise your rents for existing tenants? A property manager will keep rents inline with the market, making you more money.
- Let’s face it, most of us are suckers for sad stories and we like avoiding conflicts. A property manager can handle tenants who have million excuses for paying late.
- A property manager is well versed on the appropriate rental laws and housing regulations and know how to prevent legal issues associated with them.
- Not only will a property manager take care of routine repairs, they’ll also have staff available 24/7 to handle emergencies. With their experience, they’ll have a list of approved contractors to handle any crisis.
- Hiring a property management company will allow you to own your business without employees. They will be considered independent contractors. It means that you will be paying the company and the company pays its employees.
There are no hard and fast rules when hiring a property management company. You’ll just know due to your time constraints, business goals, and the demands in your personal life.
If you’re starting to feel overwhelmed with all the responsibilities — that’s a sure sign you could benefit from a property management company. If you can sleep at night knowing everything is being attended to and you’re still making money, why wouldn’t you?