What Is Property Management?
Many assume that property management is a term that is self-explanatory. Not too many ask what is property management, but more so ask what does a is a property manager do? A property manager is one that supervises someone else’s home and/or property. Why would an owner want to rent out their property or what are the benefits of hiring a property management company?
A business doing residential property management (or commercial property management) services has to wear many different hats to properly look after the property entrusted to them. The number of roles and services depend on the size (how large), type of rental, and type of property. The property management duties and responsibilities are: finding and screening tenants, opening leases, collecting rent, handling evictions, inspecting properties, and maintenance/repairs. In other words, a property manager acts on behalf of the owner to maintain/secure the property’s value while making income.
What is Property Management: The Basics
It’s the supervision of industrial, commercial, and/or residential real estate, which include detached houses, apartments, shopping centers, and condo units. Typically, it involves the overseeing of a property that’s owned by another entity.
Some real estate brokers also take on property management duties and responsibilities, such as when a broker in a resort town provides buyer-seller services as well as property management commercial services. In such a case, the broker also lists, shows and leases vacation house rentals.
Property management companies can offer a lot more services than the basics of managing tenants and property. For example, our property managers in Phoenix help owners design budgets, qualify tenants, advertise properties, maintain/repair properties, collect rent, and ensure that owner is compliant with local landlord-tenant & real estate board laws. Property management companies are also responsible for interior and exterior cleaning, preventive maintenance, and it’s structural integrity.
Do property managers pay for repairs? Typically, maintenance and repair jobs are funded by the owner. Note that property management companies (or property managers) are compensated by a fee or certain percentage of the rent generated while under their management.
Property Management: Qualification
Different states have varying requirements for property management licensing. Most states require that property management companies are licensed by their local real estate board. Holding a real estate broker’s license allows for a wider range of services: listing properties in MLS (multiple listing service), marketing properties by approved real estate marketing methods, and placing a real estate board lockbox on the door of a property so that other licensed agents can show it.
Why Hire Property Management Companies?
Owners have various reasons. Some may have a number of commercial or residential rental properties in their portfolio yet don’t have time or expertise to deal with tenants and/or maintain their properties. Some owners are only interested in owning rental properties and earning profits. To add, there are also absentee landlords who opt to pay a company to worry about property management duties and responsibilities.
On the other hand, there are property owners who sometimes take part in inexpensive housing programs to take advantage of property management services. It’s because participating in such programs obligate members to have knowledge of federal guidelines –which some owners do not have albeit they want to enjoy the benefits of cheap housing programs.
Now that we have a clearer understanding of what exactly does a property management company do, perhaps it’s time to seriously consider why you should rent your property.