Upfront costs and ongoing expenses aside, owning real estate property can be a rewarding and profitable experience that means having a stable source of income and a valuable asset that can appreciate over time. Naturally, this comes with responsibilities. As a property owner, you’re responsible for everything from maintaining the property and ensuring compliance with local laws and regulations to dealing with tenants. Mismanagement in these areas can cost you money. For example, a disgruntled tenant may sue you and win.
Luckily, you don’t have to do it all by yourself. Here are 3 ways that the right property management company or agent can save you money on your real estate rentals.
Bad tenants can cost you a lot of money; causing damage to the property that you’ll have to pay for, lost income from not paying rent, and even legal fees when you need to take legal action to evict them.
Here’s how a property manager screens potential tenants to prevent this:
- Conducting credit checks on applicants to determine their creditworthiness to get an idea of how responsible the tenant is with their finances
- Conducting a background check to reveal any criminal history or past evictions that are red flags
- Verifying an applicant’s employment to further ensure that they have a steady income with which to pay rent
- Scheduling a personal interview to assess their personality and behavior, and determine whether they are a good fit for the property
Maintenance and Repairs
When it comes to property rentals maintenance and repairs are inevitable. Malfunctioning electricity, low water pressure, chipped paint, water damage, pest infestations, the list is seemingly endless.
Here’s how a property manager can save you money on maintenance and repairs:
- Establishing a preventative maintenance plan, such as regularly changing air filters, checking for leaks, and cleaning gutters before they can turn into expensive repairs
- Building relationships with reliable and affordable vendors, such as plumbers, electricians, and contractors that lead to better pricing and faster service that save you money
- Handling emergency repairs, such as a burst pipe or electrical issue to minimize costs
- Maintaining tenant satisfaction by quickly addressing maintenance issues, that can lead to tenant retention and save you money by preventing vacancy periods and turnover costs
Regulatory compliance is a real and sometimes complex part of managing commercial property. The wrong actions or inactions can cost you a lot of money at the very least.
Here’s how a property manager can save you money in the compliance area:
- Being well-versed in the laws and regulations that govern rental properties enough to keep your property up-to-date with the latest legal requirements to avoid costly fines and penalties for non-compliance
- Minimizing legal liability by ensuring that the property is safe and habitable for tenants such as having all required safety features (smoke detectors and fire extinguishers) installed and functioning properly
- Streamlining any eviction process to save money in lost rental income and legal fees
Hiring a property manager for your property rentals is generally a good idea. Primarily, the right manager can save you a lot of money in the long run by screening tenants, getting ahead of maintenance and repairs, and keeping you compliant.