The Importance of Having a Property Management Company

Real estate property management is an essential component of maintaining a property and its value in the market, not to mention attracting tenants. Owners and landlords who are busy, own several properties, or who are out-of-town can certainly benefit from enlisting the help of a property management company, and save money in the long run, to take care of property issues and repair damages before they get out of control.

Finding a reliable management company that can efficiently handle the running and maintenance of your property is essential, not only for peace of mind, but also to ensure the maximum market value. A property management company takes care of all the details so you can focus on growing your investments.

What to Look for in a property management company

It takes all sorts to make up this industry profession, so it’s important to do your research before hiring a property management company. Consider how professional the person/company is. Do they appear honest and trustworthy? How will they handle situations when tenants don’t pay? Do they truly seem concerned and willing to take care of the property and look after it?

When communicating with a property management company, be sure to note the quality of their customer service. This is an important aspect since the owner/landlord, as well as the tenants, will be dealing with the company regularly. Strive to find a company that is courteous, attentive, responsive, prompt, friendly and helpful. Ask about their experience and expertise. Determine if they have the right level of sophistication for your properties in question.

It is important that the manager, company and their overall business ethics inspire confidence and trust in you so you’re completely comfortable in assigning the property to them.

What a property management company Does

  • Manage Finances: Investors can get good returns provided that they stay within their budgets. A property management company should have good money management and bookkeeping skills to help budget for the various expenses that come along with maintaining a building, repairs, taxes and advertising.
  • Manage Property Promotions: property management companies can advertise through newspapers, the Internet, and more, to find suitable tenants for vacant units. This process includes showing the potential tenants around the property, receiving and processing applications, screening and running credit checks, and choosing the most qualified tenants. In addition, the property management company should research the area to ensure an appropriate rate is being sought for rent. Getting an owner premium rentals for the least expenses is one way to really maximize their returns.
  • Manage Legal & Taxes: Lease agreements, renting, building upkeep, and staying within federal and state regulations are all part of the job for a property management company. He or she will also manage the paying of taxes and bills for the property. The manager should have good legal knowledge about property and tenancy laws for preparing deal papers, and the expertise to include suitable clauses and take appropriate legal action against a tenant if any agreements are violated.
  • Manage Tenants: This involves everything from finding tenants for the properties and verifying their background to collecting rent and resolving any tenant issues or complaints that arise from time to time. It is the responsibility of the property management company to ensure that the units yield consistent rent and that they maintain good relationships with the tenants, while maintaining consistent and fair enforcement of the rules and regulations. A good property management company will be quick to resolve issues caused by problem tenants and be firm in evicting them, if need be.
  • Manage Maintenance: property management companies help keep buildings maintained and in good condition so that it conforms to local health regulations and safety codes. This includes responding to tenant requests for repairs and dealing with any emergencies. They schedule regular maintenance, such as cleaning common areas and keeping up the lawn and landscaping, service heating and air conditioning systems regularly, painting and electrical inspections. Managers may bring in plumbers, technicians and other service vendors when needed.
  • Prepare Reports: A good property management company will prepare detailed reports for the owner to help project profits and losses. These may be done on a monthly or annual basis … or both. In addition, a manager should prepare balance sheets to record details of income and expenses, and maintain a tracking system of miscellaneous financial records.

Having a good property management company on your side goes a long way in ensuring easy, profitable and stress-free investing. It can bring you hassle-free rentals and maintenance, while optimizing your cash flow and return on investment.

Questions to Ask Before Hiring a property management company

Finding the right property management company that fits your expectations may seem like an impossible task. However, with a bit of research and by asking a few questions, you can be on your way to success.

How much will it cost?
Fees can vary across the nation, from 4 to 12 percent. Make sure you know upfront how much it will cost. Some companies offer all-inclusive packages, while others charge separately for each service. Regardless of the structure, all fees must be included in the contract.

What all does it include?
property management companies differ from company to company in what amount of responsibilities they’ll maintain. Prior to making a final decision, be sure you know exactly what it is the manager offers and determine if it meets your needs. Consider full-maintenance services, accounting services and tax calculations, property insurance claims handling, and more.

What property experience do they have?
Choose a company that has experience in managing properties similar to your own. Also, be sure to research how well their other properties are maintained.

Who will handle the property?
Find out who at the property management company will be assigned to handle the property full time. Make sure that they are experienced and professional, and that there is someone available at all times to handle issues when they arise.

Are there any hidden costs?
Some companies will charge an extra fee for items such as showings or evictions. Ask about this upfront to avoid any surprises down the road.

What is the process for fee collection?
Determine if you will be billed monthly or quarterly, and ask about direct deductions from your account.

What do they do for advertising/marketing?
Gain an understanding of how they promote properties and what costs are associated with it.

What are the estimates for preparing units?
Ask about typical cleaning fees and how long it will take to clean up a unit before it’s rented out again.

What procedures will require owner approval?
Determine an amount that the property management company can spend on repairs without having to get owner approval.

What are their hours of operation?
Find out what their business hours are on weekdays, weekends, and holidays. If no one is in the office, how would you or a tenant get a hold of them?

What do they do for their accounting system?
Inquire as to what reports they’ll send, how often and by what means. Make sure their software programs are compatible with yours, if they’ll be sending them electronically. It’s imperative to have impeccable systems for financial tracking, equity growth, and cash flow.

Can they provide some references?
Ask the property management company for at least three references of other landlords/owners whom you can contact. Seek the opinions of those who have worked directly with the property management company with similar types of buildings.

Do they manage other properties?
Many property management professionals handle multiple properties for various landlords/owners at the same time. If this is the case, ensure that the buildings they manage are similar to yours. Ask how they plan to split the time between properties.

Connect With Us Today

Celtic Property Management could very well be the right property management company for you. Give us a call to discuss your needs today: 816-214-8354.