What services does a property management company provide?
Property management companies provide a wide range of services to investment property owners. Most property management companies provide a full-service end-to-end solution from finding the tenant to collecting rent and minimizing vacancy.
This guide will dive deeper into the services provided by property management companies.
Finding and screening tenants
Finding the right tenants is perhaps the most challenging part of managing a rental property. It can be an especially time-consuming process if you are managing it all on your own. The main challenges in finding suitable tenants are:
Background check of applicants to ensure a clean record
Agreeing on a lease agreement
Finding the most desirable tenants (families/students/pet owners)
Avoiding dubious and suspicious applicants
Property management services provide end-to-end support in the tenant hiring and screening process. They handle all the tasks from the initial communication to the house tour. For people who don’t have the time to manually go through every applicant, hiring a property management company is the best option.
However, if you are interested in managing tenants yourself, see our guide on how to find the perfect tenant.
Creating property management reports
Many passive rental property owners don’t understand the importance of property reports. However, if you want to maximize your passive, rental income, its important to review these reports monthly.
In simple words, property reports detail every financial and non-financial activity associated with a property. It includes every investment made on the property (for upkeep, renovation, etc.) and the income the property generates.
Using reports to make informed decisions will make your property more profitable over time. Property management companies create various reports, like income statement, account ledger reports, etc. Most investors do not track these expenses accurately.
Managing maintenance and repairs
Properties need routine maintenance, repairs, and upgrades to retain and increase their rental value. Contractors like handymen, painters, plumbers, electricians, etc. perform these tasks. A property management company handles all correspondence with these contractors and supervises maintenance, repairs, and renovations of a property.
Dealing with multiple contractors and getting the best quote from them is a time-consuming and complicated task. It’s especially difficult when your rental property is not in your geographical proximity or you don’t have access to a network of contractors. Property management services include every aspect of home repairs, maintenance, and renovation.
Minimizing vacancy periods
Vacancy periods are the times when no tenant is occupying your rental property. Investment property owners aim to minimize vacancy periods due to ongoing expenses. Even when nobody is living on your property, you have to spend money on mortgage, utilities, maintenance, and repairs. As a result, your asset turns into a liability and becomes an expense instead of generating income.
Property management companies help their clients minimize vacancy periods by properly planning ahead. They help you find a new tenant even before your previous tenant vacates. That way, you don’t have to leave your property vacant for an extended time period and keep earning a steady income.
Dealing with problematic tenants
Is your tenant not paying rent for months on end? Are they getting into trouble with the police and/or neighbors? Despite our best efforts, we can’t control how our tenants may act. Problematic tenants can involve you in legal trouble as the owner of their rental property.
Property management companies deal with problematic tenants on your behalf. It saves you tonnes of time and money. Getting into a tenant-related legal case is the worst nightmare for any property owner. It is stressful and time-consuming. With the help of a property management company, they can rule out any chance of that happening.
Collecting rent
Rent collection is not as big of an issue as it used to be, primarily due to digital payment options. Nonetheless, some tenants would be difficult to deal with, especially when it comes to rent collection. Property management service providers collect rent from tenants and transfer it to the property owners. It may not seem to be a significant task, but any homeowner who has dealt with difficult tenants knows the value of a third-party entity managing the rental collection process.
Conclusion
Property management services are essential for most rental property owners. They simplify every aspect of managing a rental property and generating income from it. If you want to manage your property and tenants more efficiently, consider hiring a property management company.
