Owning a rental property has the potential to be one of the most financially rewarding investments you’ll ever make. If you aren’t making use of a property management service, you could be missing out on some of those rewards.
Renting out a property is a great way to make passive income. But it isn’t passive income if you have to work for it. If you’ve owned a rental property before, you know how much work goes into DIY property management.
Handling maintenance repairs, screening tenants, and preparing vacant units for rent can take up hours of your time each week. If you have multiple rental units, this can easily become a full-time job.
When you hire a property manager, they handle all of these tasks for you and more. Keep reading to find out all of the ways hiring a Memphis property management company can help you.
How Does a Property Management Service Work?
A property management service is a third party that handles the day-to-day care of a rental property on behalf of the property’s owner. Property managers oversee the daily operations, interact with occupants, and more.
Property managers handle all kinds of rental properties, from single-family homes to multiple-unit residences. They do everything that is needed to keep a rental property functioning profitably so you don’t have to do it yourself.
Reasons To Hire a Property Manager
Using a property management service has many advantages. But not every rental property owner may require one. You should consider hiring a property manager if you meet the following qualifications.
You Own or Plan to Own Multiple Rental Properties
Is it your goal to own multiple rental properties? If so, it is a good idea to hire a property management company to take care of them. Trying to manage multiple properties on your own would be a full-time job.
You Live Far Away
Unless you live near your rental property, it can be time-consuming and difficult to keep an eye on things. If you live in a different city or state from your rental, hiring a property manager can be a huge help.
You Don’t Want to Manage Your Property Yourself
Perhaps you have no interest in managing your rental property on your own. In this case, it is hugely beneficial to outsource your property management duties.
You Don’t Want to Employ a Resident Manager
Some property owners hire one of their residents to serve as property manager for a building. When you do that, the resident becomes your employee.
When you use a property management service, the property manager is an independent contractor rather than an employee. Don’t want the burden of becoming an employer? Use a property management service.
You Can Afford It
It’s no secret that hiring a property management service costs more money than managing a property yourself. Property managers get paid a percentage of the rental fee.
It is important to weigh the difference between the time and energy you’ll put into self-management and the cost of hiring it out.
Your Time Is Limited
Maybe you do live close to your rental property. You simply don’t have the time available to manage it. If you have other things on your plate, hiring a property manager can save you stress and time.
Your Property Is Affordable Housing
Is your property part of the affordable housing program? Affordable housing comes with many benefits for low-income renters. It also comes with additional rules and regulations.
A property management company will have the experience and expertise to navigate these regulations with greater ease than you might be able to do on your own.
How to Choose the Right Property Management Company
Of course, not all property management companies operate quite the same way. Nor do they all offer the same host of services or prices.
It is important to evaluate your options using specific criteria to find the best property manager for your rental. That way you don’t end up wasting your time or money on a subpar company.
Here are the things you should look for in a property management service.
Knowledge of Landlord-Tenant Laws
It is absolutely crucial that you hire a property manager who is current and well-versed in Memphis landlord-tenant laws.
Your property manager should not only know the regulations and ordinances in your area. They should know exactly how to address them.
Tenant Screening Process
Your property management service should use a thorough screening process when considering new tenants. It is in your best interest to find out the details of how they screen before you hire a property manager.
A thorough tenant screening process should involve a wide range of background checks. These can include rental history, employment, credit, and criminal checks.
Your property management service should always consult you before agreeing to rent your property to a new tenant. You must have the power to approve or deny a tenant.
Management Company Fees
Your property manager is responsible for a lot of services. They collect rent, screen tenants, prepare vacant units to rent, handle maintenance repairs, and more.
In exchange for their services, management companies charge fees. These fees can cover everything from management to leasing to maintenance.
It is important to find out what these fees will be when you are considering hiring a property management service.
The management fee is the main fee you’ll pay every month. This covers the everyday operations the property manager handles. Regular management operations include collecting rent and maintaining communications with tenants.
If your property management service handles leasing new tenants, you’ll also pay a leasing fee. This covers the costs of advertising vacant units, screening prospective tenants, and handling paperwork.
If an existing tenant wants to renew their lease, the property manager may charge a lease renewal fee. This isn’t standard and some property managers may skip this fee. Others charge a percentage of the rent.
Finally, the majority of property managers charge a maintenance fee. Most will charge either a flat fee or a percentage of the cost of repairs.
Memphis Property Management Solutions
The benefits of hiring a property management service are clear. If you aren’t in a position to tackle full-time property management yourself, you’re probably wondering, “where can I find property management near me?”
Reedy & Company has over 40 years of experience as one of the leading property management companies in Memphis. Our experienced staff is ready to provide you with the top-notch service you deserve.
Contact us today to learn about the property management services we offer.