What is property management? Property management plays an important role in the rental industry, ensuring properties’ timely and smooth operation. This is the right place to start if you’re a landlord looking to understand property management better.
What Is Property Management?
Property management refers to the management and operation of rental properties. Professionals do this on behalf of landlords, who hire the services of managers or management companies. Property management covers various tasks that serve to maintain the rental property, manage tenants, and maximize property value.
Types of Property Management
Property management comes in three major types: residential property management, commercial property management, and industrial property management.
Residential Property Management Services
Residential property management is the practice of managing residential properties. These include single-family homes, condominiums, and apartments. Residential property managers perform tenant screening, rent collection, property maintenance, and evictions.
Commercial Property Management Services
Commercial property management is the practice of managing commercial properties. These include office buildings, retail spaces, and industrial parks. Commercial property managers cover a variety of responsibilities, such as lease negotiations, common area maintenance, and tenant management.
Industrial Property Management Services
Industrial property management is the practice of managing industrial properties. These include warehouses, manufacturing facilities, distribution centers, and other industrial facilities. Such properties typically come with specialized infrastructure, making them harder to manage. Additionally, there are often industrial regulations that these properties must follow. Industrial property managers are responsible for all that.
Property Management Duties and Responsibilities
Understanding the duties and responsibilities that fall under property management is important. This lets you know what to expect from a property management company. Setting your expectations right from the start will allow you to select the appropriate company and evaluate candidates based on objective criteria.
What does a property management company do?
1. Tenant Screening
Property management companies screen potential tenants by performing background checks, verifying rental history, and assessing their credit reports. The process typically involves calling references and past landlords to gauge their character. Tenant screening can be tricky, as you might risk violating Fair Housing laws. As such, it is best to leave it in the hands of a company well-versed in legal compliance.
2. Rent Collection
Property management companies offer rent collection services to make payments easier for tenants and landlords. Nowadays, most companies allow tenants to pay rent through electronic channels, which reduces the chance of late payments.
When there are late payments, though, property management companies are responsible for sending notices and warning letters. They can even refer the account to a debt collection agency. This ensures that landlords receive consistent income.
3. Maintenance and Repairs
Property management companies oversee routine maintenance and promptly address repair requests. This ensures that the rental property remains in good condition. Some companies have in-house personnel for maintenance and repairs, while others keep a roster of preferred vendors for such jobs.
4. Lease Management
Property management companies negotiate and prepare lease agreements, enforce lease terms, and handle renewals or terminations. This is particularly beneficial for landlords not as adept at contract management.
5. Property Inspections
Property management companies conduct regular inspections of the rental property. This helps identify any gaps in maintenance or safety issues that require attention. It also ensures that tenants adhere to their lease and are not damaging the property. Moreover, this covers move-in and move-out inspections.
6. Marketing and Advertising
Advertising your rental property is one of the most challenging aspects of property management. Fortunately, a property management company can do this as well.
Property management companies can list your property both online and offline. They can take photos that showcase the most attractive parts of your property and write copy that entices potential tenants. Furthermore, these companies can also field questions and concerns from interested parties.
7. Tenant Relations
Property management companies can handle tenant complaints, concerns, and disputes. This ensures a harmonious living environment for tenants and a seamless experience for landlords. Plus, addressing the needs and concerns of tenants promptly and respectfully can help retain high-quality tenants.
7. Financial Reporting
Property management is not just about the operation of the rental property. It also includes financial reporting and analytics. Financial reports help you measure profitability and identify problems from a financial perspective. If you have no experience preparing financial reports, a property management company can help.
8. Legal Compliance
Property management companies ensure your property complies with all state and local laws or regulations. These include housing codes, safety standards, and other ordinances.
Who Needs Property Management Services?
Property management services can benefit rental property owners, landlords, real estate investors, and business owners. If you find that one or more of the following applies to you, it is time to look into professional property management:
- You lack time to manage your property.
- You don’t have the expertise or a background in property management.
- The rental property is located far away from where you live.
- You own more than one rental property.
- You are simply uninterested in property management.
How Much Does Property Management Cost?
Property management company fees can vary depending on several factors. These include the type of property, the location of the property, and the level of service you require.
A property management company will generally charge a percentage of the monthly rent. This percentage can range from 4% to 12%. Apart from the base fee, some companies charge additional fees for specific services, such as maintenance markups, tenant placements, evictions, etc.
Rental property owners must carefully review the terms of the management agreement before placing their signature. The agreement should outline all the fees that come with the service, including any fees for renewing or terminating the contract. Although property management comes with a price, professional help can increase rental income, reduce vacancies, and provide peace of mind for property owners.
What Is Property Management? Answered!
Many rental property owners feel apprehensive about hiring a property management company. However, when you entrust your day-to-day operations to an established firm, you can optimize your investment and be free of the headaches of being a landlord.
SurfRider Property Management is every property owner’s answered prayer. Call us today at 727-403-7088 or contact us online to learn more about what we do!