Renting out a property is something many people dream of. It sounds like it should be easy; you let someone use a space that you’re not using, and they pay you passive income. But many owners soon learn that managing rental properties can actually be quite a challenge. Residential property management involves a wide variety of administrative tasks, meaning that it’s not really passive income at all.
Help managing a rental property is available in the form of a professional rental property manager. This is someone whose full-time job is administering rental homes, but many new owners are sceptical of their value. Is there really so much work that they need to hire someone else to do it? To help answer that question, here are the tasks that rental property managers routinely deal with.
Table of Contents
Attracting and Screening Tenants
The quality of tenants is one of the main factors that will affect whether somebody has a good or bad experience renting out their property. We all know what makes a good tenant: they pay on time, follow the rules and are respectful of your property. But most people don’t know how to lease specifically to those people. To start with, you need to effectively market your vacant property to them.
Property management companies have lots of experience doing this. They know which websites to list your property on and what kind of photos to use. They’ll also take care of viewings so that you’re free to work or do other things. Once tenants start applying, they’ll use their expertise to review applications, verify income and contact references to make sure you’re renting to tenants you can trust.
Collecting Rent
Professional property management services have a variety of systems in place for collecting rent, which may include online payment portals, bank transfers, or physically collecting cash. Giving tenants more options makes it easier for them to pay, and rental managers also handle all the post-payment administration. This includes sending receipts and keeping accurate financial records for accounting purposes.
Rental property management services will also swiftly chase late or missing rent on your behalf, communicating with tenants on your behalf to resolve issues, enforce late fees and escalating if necessary. For the inexperienced, these situations can often be challenging and uncomfortable, and it may be difficult to remain professional at times. But trained property managers can manage tenants with ease.
Answering Maintenance Requests and Arranging Repairs
Besides having good tenants, another factor that strongly affects whether renting a property goes well or poorly is how well the residence is maintained. One that is regularly inspected and repaired is less likely to be subject to sudden problems like blocked drains, leaks or electrical failures. Rental managers can take care of this preventative work for you. However, these things can occur at any time, and it’s important that they are dealt with promptly.
With a property manager, someone will always be on hand to deal with problems when they arise. And while the average owner might have to spend time searching for the right person to do the repairs, rental management services already have relationships with trusted contractors. They’re often able to negotiate better prices, and they can get everything sorted more quickly, limiting any damage that might be caused and delivering a better outcome for the tenant.
Legal Compliance and Risk Management
Property rentals are subject to all kinds of regulations, and most property owners lack the expertise or time to really understand these. They need to know about everything from health and safety standards to rent controls and tax rules for residential rental properties. Otherwise, they could face hefty fines and other penalties. Staying up to date with all the relevant laws and regulations is central to professional property management, however.
Rental management services keep abreast of changes and will quickly figure out how they apply to the properties they manage. Then, they can make any necessary adaptations very quickly.
Budgeting and Expense Control
A rental property isn’t just a property; it’s really a business. And this means that there are expenses to manage. As we’ve mentioned, maintenance and repairs are sometimes necessary, but upgrades might also be needed in order to stay competitive in a renter’s market. There’s also cleaning between tenants, and possibly even paying for listings and promotions in order to get your property occupied as quickly as possible.
While the owner might just pay for these as and when from their personal funds, rental property managers will help you budget and manage your money like an actual business. That means prioritising what money should be spent now based on urgency and long-term value, as well as setting income aside for future expenses.
Conclusion
Managing rental properties is often much more hands-on than the owners realise. From finding great tenants to keeping financial records, there are a lot of tasks that we forget to think about when planning to rent out a property. For many, hiring a residential property management service is a very convenient solution.
