You just bought your first rental property, and you probably have the idea that a rental property is a hassle-free income. To be fair, from the outside looking in, it seems that property owners simply sit back and collect rent and don’t really do any additional work. Managing a property may seem easy, but don’t be fooled. Property management involves much more than just collecting rent. After buying your first rental you will need to decide, should you hire a property manager, or should you self-manage your property?
Many property owners don’t want to hire a property management company in order to save a few dollars but self-management comes with its own set of challenges. Property management requires a lot of time and energy. To decide what option is the best, you must be aware of and understand the duties you will be taking on if you decide to self-manage. Here are some of the landlord duties that you will have to embrace:
- Handle maintenance requests / making repairs as needed
- Finding new tenants
- Advertising your property
- Determining rental rates
- Preparing the lease
- Tenant screening
- Collecting rent
- Doing preventative maintenance
- Enforcing the lease
- Evicting a tenant when necessary
- Insurance
- Taxes
- Tenant Turnover
- Inspections
If you’ve decided to self-manage your rental properties, you must have the right tools and systems in order to be successful. Most people who decide to self-manage don’t understand the laws involved in rental properties. If you decide to self manage, you need to educate yourself on property management to avoid any problems. Here is a list of the basic laws you should know:
- Eviction rules and procedures
- The Fair Housing Act
- Your state’s Landlord-Tenant Act
- State-required disclosures
- The implied warranty of habitability
- The Fair Credit Reporting Act
- Your state’s security deposit rules
- Mitigation of damages
The Pros of Self-Managing:
- You will have 100% control over your investment
- You get to save on property management fees
- You have a bigger say on tenant selection
Managing a rental property is a full-time job and can be very stressful especially if you own multiple properties. Now if you are willing to invest the time and work needed to be a successful landlord then you can decide to self-manage. But if you don’t want to add more stress to your life, you can hire a property management company. Property managers know and understand the market much better than you. They will handle every aspect of property management.
Selecting the right property manager can make or break your real estate investment. Nowadays there are many property management companies in the real estate market that have no idea what they are doing. It makes it difficult to choose a good property management company. You need to take your time and research for property management companies in your area. Find out if they are licensed, ask for a list of references and ask if they have any certifications or members of any associations such as (NARPM) and (IREM).
Whether you decide to self-manage or hire a property manager, remember that at Five Star Property Management, we have the experience, tools, and resources to effectively manage your property and maximize the rental value of your home.