In the United States, property management firms can range from a one-person operation to a large, professional corporation. If you are thinking about hiring a company to handle your property, you’ll need to look closely at what they offer and how much they cost. The following is a guide that will help you choose wisely for your situation.
But first, Let’s discuss whether you should hire a company or do it yourself?
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Should I hire, or manage properties myself?
Is hiring a property management company worth it, or should I manage it myself? The answer to this question is simple.
Hiring an experienced property management company is usually worth the cost. They will coordinate with tenants and make sure that problems are fixed promptly, or you can even hire them for specific tasks like property maintenance. However, there are some times that it may not be worth hiring a property management company. Here are four situations where you are probably better off managing yourself.
- For The First Few Years Of Owning A Property
If you are starting to invest in real estate, it is probably best to manage the property yourself for several years. This will allow you to feel how everything works, including tenants, maintenance, upkeep, and finding new tenants. However, after a few years of moving in the right direction with your property management, you most likely will want to hire professional property management services.
- You Have A Large Investment At Stake
If you find yourself owning multiple properties or actively buying and selling properties, you need to ensure that you get the maximum value out of each property. This means that you need to hire a property management company that you can trust to take care of your assets. Otherwise, you may end up losing money unnecessarily.
- You Are Gradually Going To Be Less And Less Involved
If you plan to sell your property in the next few years, it may not be worth hiring a property management company. This is because you will most likely not need to be involved in the property’s day-to-day operations. However, if you have a regular rental income from your property and plan on being around for many years to come, then don’t hesitate to hire a professional property management company.
- You Are Going To Be Lazy
If you are going to sit back and relax while your property management company does the work, you are probably better off managing your property yourself. This is because most property managers charge a percentage of income or a flat monthly fee for their services, which means that if they do not earn money out of your investment, they will not make any money. But, on the other hand, if you are not interested in making sure your property management company succeeds, you should own the property yourself.
Hiring a property management company can be a tremendous help if you have many properties and spend your time wisely. However, if you are going to be lazy and not do anything yourself, you may want to stick to managing the property yourself.
Questions to ask when hiring a property management company
Before you decide who to hire for your real estate needs, make sure that you ask these questions, which will help you decide if their services are right for you.
- What special training does your property management company have?
You should consider asking the property management company how long they have been in business and if they have any professional certifications or licenses that show they are trained to take care of investor properties. If the company only has a handful of years under its belt, you should consider asking them about their professional certifications and licenses.
- How often and how long will I be able to talk to the property manager personally?
While you want to hire someone who can take care of your investment for many years, having the property manager at the office every day may not be practical. If this is the case, it may be best to hire a property manager who will serve your properties over the phone and by email. However, if you want to get into the office and chat with them face-to-face, it may be worth hiring someone who will at least be able to come in once a week.
- How do you handle tenant complaints?
You should ask your property manager how they handle tenant complaints and if their action method will keep both the property and the tenant happy. Your property manager needs to take care of all problems quickly and efficiently without causing stress or headaches for either party involved.
- What percentage of your income do you charge as a fee for their services?
When you first hire a property management company, they will most likely ask you if they can charge a percentage of your monthly income as a fee. Then, a few months into working with the property management company, they will probably ask to increase the percentage they charge you. If you do not want to raise your rent or charge for increased services, you may want to hire a property management company that charges a flat monthly fee instead.
- Are there any hidden fees that they will charge me?
While it is important to ask about the amount of money the property management company charges, it is also worthwhile to ask if they will charge you any hidden fees. This can include anything from late notices and leasing contracts to paperwork and pest control services. It would help if you asked them these questions to ensure they only charge you for essential services and not add more financial burdens to your monthly expenses.
- How do you handle tenant turnover?
Time after time, property management companies will tell you how easy it is to find new tenants and how much their tenants love them. However, this is not always the case, and the key is knowing the best way to handle tenant turnover. Some property management companies will charge you for finding new tenants, while others may charge you last month’s rent for the vacant property.
- How do you handle maintenance?
When one of your tenants calls in to complain about not working, will they send an emergency maintenance person or charge you for the service call? You should ask your property management company how they handle maintenance requests and include their services in your monthly fee.
- Which Property management software do you use?
Make sure that they at least use property management software where you can log in and track the situation anytime you want? Many property management companies will use different tracking software to help them be more efficient with their work. However, if your property management company uses the same software you are using, it may be easier for you to keep track of your properties and get the most out of their services.
- How many properties each employee has to manage?
If you hire several people to manage your properties, you should ask the property management company how many properties each employee has to manage. This way, you can make sure that you are getting the best possible service for your investment.
If you think the employee is overburdened with work, you can always ask them to assign another employee to assist them in managing your properties.
- How long have you been a property management company?
You want to know that the service being given to you is from someone that has been in business for a while. It would help if you asked them about their history and how long they have been doing business. If they only have a few years under their belt, then you should reconsider hiring them for your needs.
Finding the right property management company that can give you great services for your real estate may seem like a daunting task. However, if you want to ensure that your needs are being taken care of to the best of your ability, it is important to ask these questions. The property management company will help you with all of your real estate needs and wants, but it is up to you to interview them properly and find out if they can keep up with all of your investment needs.