10 Dec The Benefits of a Property Management Team for Multi-family Property Owners
When it comes to owning multi-family real estate, you have two choices for running your properties: self-management and professional property management. For those unfamiliar with these options, self-management means that you, the landlord, not only own the property but also take care of all strategic and day-to-day operations. Property management is where an individual or team of professionals manage the property on your behalf. Or, more simply put, self-management requires running your property to be your job, whereas professional management allows you to turn your properties into passive income.
Whether you choose to self-manage or hire a management team, there are several essential tasks that must be taken care of to have a successful and profitable investment. These include:
- Advertising your property
- Determining rental rates
- Preparing the lease
- Screening applicants
- Collecting rent
- Managing preventative maintenance and regular repairs
- Remodeling and property improvements
- Customer service
- Moderating issues between tenants
- Evicting a tenant when necessary
- Sustaining a high occupancy rate
- Cost reporting
- Maintaining legal compliance
- Finance management
Unless managing your property(ies) is your full-time job, this can be a lot to manage. Which is one of the many reasons many property investors enlist the help of a property management team.
It is important to note that having a property management team doesn’t mean you cannot still be a part of the management and decision making process, if you choose. It does mean that you aren’t required to be involved on a daily basis and offers you many other benefits including:
More Time and Less Stress: Probably the biggest advantage of using a property manager is the time and stress you will save. Being a landlord is a 24/7/365 job. Many of our clients have come to us because they want to spend their energy on their families, careers, travel, or other investments. (And many are simply tired of working nights and weekends!) Having a property management team means you don’t have to be “on the clock” anytime you don’t want to.
Experience and Expertise: Another invaluable advantage you’ll have by working with a property manager is their years of experience. Seasoned teams, like ours, have truly seen it all and know how to handle everything from difficult tenants, to confusing permits, to new market trends.
The world of multi-family real estate also involves a long list of ever-changing laws, regulations, requirements, and best practices you need to be aware of. When you work with a property management team, it is their job to understand the ins and outs of the rental industry and ensure you are always up to date and in compliance with items such as: lease management and tenant notifications, Fair Housing, ADA, and COVID-19 regulations, employment laws, payroll and tax requirements, city and build codes, as well as overall risk mitigation.
Ease of Filling Vacancies: Even when the rental market is hot, you always want the best tenants at the best price point and achieving this magic balance requires a deep understanding of the industry and the local market. A strong property management company will have the tools to effectively market the property, screen applicants for the best tenants, increase retention, and drive occupancy, and rental rates to their maximum potential.
Cost savings: Property management teams typically oversee the management of multiple properties (we’ve managed over 1,000), which means we have industry knowledge, connections, and teams needed to get the best professionals at the best rates when it comes to maintenance, construction, and any other outsourcing you may need.
For example, here at RRA, we have a team of in-house maintenance specialists and contractors available to you at a discount! Because of our large portfolio, we are able to leverage economies of scale and support multiple complexes with the same team. We then are able to pass on substantial cost savings through our reduced labor rates and corporate negotiated wholesale direct material prices.
Your property manager will also have a working knowledge of existing multi-family property operations and finance modeling, which gives them the ability to identify which options will work best for each particular owner and property. Their experience and expertise will provide you with cost-saving measures and increase your overall NOI. However, when looking for a property manager, it is important to find a team that understands your specific goals and is able and willing to create a customized strategy for you.
In addition to the above benefits, sometimes property management is simply more practical. For example, you might live a good distance away from some, or al,l of your rental properties, you might have significant day-to-day responsibilities that would make emergency calls or last-minute requests complicated or impossible to deal with, or you simply may not have the industry knowledge and experience to get the highest possible return on investment.
Finally, it is important to note that you may change your mind overtime. You may have enjoyed self-managing for many years but don’t want the full time responsibilities anymore. If this is the case, know that property management does not mean you have to give up the parts of the job you do enjoy! Our property management services are all about providing excellence in customer service– which means we understand no two clients are identical and we customize our model to best fit each client’s needs.
Once you decide if a professional property management service is the right choice for you, the key to moving forward with the right property management company is to find a company that will work with you. Click here to read our blog on how to find a property management team that fits your needs.