Accidental Landlord? Working with a Property Manager is your best solution
Surprise! You are going to be a landlord. Your company, government agency or sports team is moving you out-of-area or out of state and you recently bought your home. What is your first thought? I bet you are worried about how you are going to get your home leased and managed while you are living 1500 miles away. Regardless of how far you live, a property manager for your investment is a wise and safe choice.
Why should you hire a professional?
Many homeowners choose to hire a property manager because they will:
- Look at your expenses and investments for your property, measure market value, and set up a rental plan based on market conditions. The goal is to realize future profits for you.
- Collect a management fee of 6 - 10% fee which is based on the monthly rent. Eviction coverage, applicable taxes, maintenance costs are extra. Although, this may seem costly to you consider the time saved since you don't have to manage repairs or tenant issues long distance.
- You don't have to worry about being 'friendly'. Managing a property is a business like any other and cash flow is important. Listening to a tenant's story about why he/she can't pay rent is difficult. You might feel sorry for the tenant and let them slide. However, remember if the rent is late your mortgage may end up being late and you will have to pay the fees that go along with a late payment.
- Use a software program for rent collection. This is a guaranteed method for maintaining an on time system for collection and record keeping.
- Start the eviction process when necessary. A property management company has the same type of system that a bank uses when your mortgage payment is late. Your tenants are aware of what happens when they are late with a rental payment, but if you are the landlord your tenants could also refuse to pay the late fee. If you have a property manager, the software program used to collect your funds will generate a notice of a late fee due and an eviction notice when allowed per the laws of the state where your property is located. You won't have the worry of being a 'mean' landlord.
You can expect your property manager to do the following for you:
- Market your property and make suggestions for improving curb appeal. Your property manager will know how to creatively advertise your home and where to market for your new tenants.
- Set up appointments for prospective clients to show your property.
- Screen prospective tenants. This includes references, consumer credit, and criminal background checks.
- Provide and/or negotiate the lease, collect the security deposit and rent money, do an initial walk through/inspection with the tenant, and provide keys.
- Conduct periodic inspections of the exterior and interior of the house and provide you with the necessary reports and/or photos resulting from those reviews.
- Manage tenant complaints and repairs.
- Enforce guidelines of the lease agreement.
- Prior to lease expiration, the property manager will review the rental history, lease violations, tenant complaints, property condition and consult with you to determine whether or not to keep the current tenants or replace them.
- Monitor a tenant move out, collect the keys, re-lock the locks, inspect for necessary repairs, return the security deposit to the tenant per the guidelines of the lease, and prepare your property for a new tenant.
- Most importantly, you property manager will provide you with a solid lease so that if you end up in court, you are sufficiently covered.
Sounds like a dream come true! Having a responsible property manager will maintain or even enhance the value of your property by ensuring that your home is maintained in the best condition. You won't have to worry about emergency repairs or collecting rent. You can complete your move with the assurance that your home is managed by a professional who has your best interest at heart.