NUTS & BOLTS
Leveraging Quality Property Management
GOOD PROPERTY MANAGERS WILL DO MORE THAN JUST SERVE AS A POINT OF CONTACT BETWEEN THE LANDLORD AND TENANT. THEY’LL ALSO HELP MAXIMIZE YOUR ROI.
5 ASSISTING WITH MAINTENANCE AND REPAIRS – LOWERING COSTS, PRESERVING THE VALUE OF YOUR INVESTMENT AND KEEPING TENANTS HAPPY A reputable property management company will have had extensive experience in handling repairs and maintenance at rental properties and will be able to help you maintain the value of your asset. Regular repairs and basic upkeep can also go a long way toward keeping good tenants happy – encour- aging them to stay in your rental for longer. Additionally, a property manager with years of experience will most likely have built up an extensive network of reputable contractors who are licensed, bonded and insured – ensuring that you’re getting high-quality repairs. In some cases, going through a property manager can even help you save money on repairs. If the property manager is able to get volume discounts on the work, often the savings are passed along to you. 6 KEEPING YOU IN COMPLIANCE WITH THE LAW – REDUCING COSTLY LEGAL PROBLEMS It’s important for landlords to have a working knowledge of landlord-tenant laws and a clear understanding of their responsibilities. Since the law is always changing, it’s especially important to keep up with new legislation and how it affects you as a landlord. A few areas that you’ll want to pay especially close attention to include: tenant screening, security deposits, rent increases and evictions. You need to make sure that all your policies and procedures are in line with federal, state and laws. One of the benefits of hiring an experienced property manager is that the company will be familiar with the law and will be able to make decisions on your behalf that will help keep you in compliance – and on the right side of the law. 7 SAVING YOU TIME – ALLOWING YOU TO EXPAND YOUR PROPERTY PORTFOLIO Since professional property managers will take on all the rental-related responsibilities, they can save you a tremen- dous amount of time and hassle. For many investors, the ability to invest in rental properties – without having to take on the day-to-day responsibilities associated with them – is what makes income properties such an attractive investment option. Outsourcing much of the work allows you to focus
instead on your investment strategies and adding more prop- erties to your portfolio, without having to concern yourself with directly managing the investments. 8 MAKING IT EASIER TO INVEST IN PROPERTIES THAT ARE OUT-OF-TOWN – ALLOWING YOU TO TAKE ADVANTAGE OF POTENTIALLY BETTER MARKETS Finally, enlisting the services of a property management company also allows investors to purchase property that’s located outside their area. This freedom allows you to take ad- vantage of rentals in growing markets, or invest in areas where housing may be more affordable. Instead of having to stick with rentals that are in your own neighborhood, or being forced to take on the responsibilities of a long-distance landlord, you can outsource the work to a local property manager – allowing you to reap all of the rewards, with none of the hassles. As you can see, good property managers don’t just make life easier. They allow your rental investments to generate the best returns possible. If you’d like to ensure that your property is managed to high standards, improve your tenant retention rates and increase your rental yield -- all while freeing yourself up to invest in more properties or to capitalize on markets that are outside of your local area -- then it could be time to consider enlisting the services of a qualified property management company. Don’t feel that you have to manage your property yourself in order to experience the benefits that income property offers. Outsourcing your rental responsibilities is a great solution for busy landlords and could prove to be a vital part of your investment strategy. • Kevin Ortner is president and CEO of Renters Warehouse. He first joined the company in 2009 as a franchisee for the Phoenix region, and after founder Brenton Hayden’s retirement, Ortner went on to take the reins of the company, helped see it through monumental growth and helped double the company’s total number of franchisees in the country since 2013. In 2015, he was honored with both an American and International Stevie Business Award for his achievements as Executive of the Year. With Ortner at the helm, Renters Warehouse secured elite honor roll status on the prestigious Inc. 500|5000 list of fastest-growing privately held companies in America for its sixth consecutive year.
by Kevin Ortner
hile many landlords decide to go it alone with their rental investments, a growing segment is choosing to outsource the day-to-day responsibilities to property managers. Most people know that hiring a property management com- pany can help to alleviate much of the stress and hassle that’s often associated with overseeing rental properties, but the truth is that a good property manager will do more than just serve as a point of contact between the landlord and tenant. The best professionals can also help landlords maximize the return on their investment, allowing them to get the most out of their rental property. From tenant sourcing and screening, to overseeing the maintenance and repairs, to taking on the eviction process so that you don’t have to—a good property management partner is more than worth its weight in gold. Here’s a look at a few ways they can help you boost your rental income and even allow you to expand your rental property empire. 1 MARKETING THE PROPERTY – REDUCING VACANCY TIME BETWEEN TENANTS A reputable and long-standing property management com- pany will have tenant placement down to a science. They’ll have connections, as well as access to internet marketing, and will be able to get your property in front of a wider audience. This will increase the amount of interest that your listing re- ceives – and deliver a larger selection of applicants to choose from. Some property management firms will even have a list of tenants who are looking for properties – something that can further expedite the tenant placement process. Getting tenants into the rental fast is key to cutting down on vacancy time and reducing the number of days – or even weeks -- that a property sits empty. 2 PROVIDING THOROUGH TENANT SCREENING – VITAL FOR SECURING QUALITY TENANTS According to credit reporting agency TransUnion, it costs landlords an estimated $1,917 to evict a resident from a rental
unit. Evictions can also be time-consuming and, for many landlords, extremely stressful. One of the best ways to cut back on evictions is by having a solid tenant screening pro- cess and running every applicant through background, credit and reference checks. A long-standing property manage- ment firm should have a thorough tenant screening process in place, which will help weed out unqualified applicants, drastically improving your chances of ending up with reliable tenants. The firm will also be able to perform screening that’s in compliance with fair housing laws, ensuring that each tenant is assessed fairly and equally, helping protect you from potentially harmful allegations of discrimination. 3 SETTING COMPETITIVE RENT – IMPORTANT FOR LOW VACANCY RATES Determining the rent isn’t a matter of “set it and forget it.” Instead, finding the sweet spot for rent involves setting a price that’s high enough to generate a profit, and low enough to keep the property attractive to tenants. It’s also important to regularly update the pricing to keep up with the changing market. A good property manager will be knowledgeable and experienced in set- ting competitive rent and will be able to determine the best price for your property. Your manager’s pricing strategy will assist you in keeping your vacancy rates low – by reducing tenant turnover and helping your property rent faster in between tenants. 4 HELPING YOU TO GET THE RENT ON TIME – IMPROVING YOUR RENTAL’S PROFITABILITY Collecting the rent on time is the only way to sustain consistent cash flow, and your rent collection efforts are something that can make or break your success as a landlord. Hiring a professional property management team is a great way to drastically improve your rent collection process. Since many property managers deduct their fees from the monthly rental income, you can be certain they’ll be motivated to keep the rent coming in. And if the tenants fail to pay, property managers will take steps to address the problem and, when necessary, even start the eviction process.
94 | think realty magazine may :: june 2017
thinkrealty . com | 95
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