A landlord’s duties can be overwhelming. From handling rent collection to property maintenance, being a landlord can be a full-time job. If you’re looking for an extra set of hands when it comes to managing your rental properties? Hiring a property manager can be a great solution to your problems. However, you’ll need to ask yourself “Should I hire a property manager?” You might also find yourself querying “property managers pros and cons” in your Google search bar — that’s a good thing!
Prior to making a job a post, it’s important to know the ins and outs of how a property manager can help you achieve both short-term and long-term. Additionally, understanding the potential drawbacks of bringing in a property manager is crucial in order to make an informed decision. Here’s what you need to know about the pros and cons of hiring a property manager.
What is a Property Manager?
A property manager takes care of the details and the every-day work of running a rental property which means that their role and responsibilities span a wide set of objectives. The specific qualifications and requirements someone needs to have in order to become a property manager vary by state. Plus, the rules shift a bit depending on what type of properties you own.
For most states, property managers need to have a real estate license. In states where this isn’t required, a property manager may hold specialized certifications, which can include: Certified Apartment Manager (CAM), Certified Property Manager (CPM), Residential Management Professional (RMP), or Certified Manager of Community Associations.
The responsibilities of a property manager are multi-faceted. For example, they handle financial concerns (rent collection, processing deposits, late fees, utilities), maintenance work coordination, enforcing lease clauses, as well as creating performance reports.
From start to finish, a property manager takes the burden off of your shoulders. They advertise your property, process rental applications, interview potential tenants, plus perform credit and background checks.
Further duties include adjusting and setting rental rates, responding to tenant complaints, performing inspections following a tenant’s move out, maintaining the books (e.g., income records, expenses, complaints, maintenance, signed leases).
Should You Hire a Property Manager?
This question is relatively easy to answer. It depends on your individual circumstances. Are you handling a small portfolio with relative ease? As in, does it not add undue stress or burden to your life? Or are you in over your head?
If you’re dealing with a large number of properties and tenants, you might not be able to handle the scope of your landlord duties. In that case, hiring a property manager can be night and day. If you’re running one are a handful of units smoothly as it stands today, there’s no need to hire one.
Property Manager Pros and Cons
Although the responsibilities of a property manager might make them sound like a superhero for busy landlords, there are also potential drawbacks to consider. Here’s a quick breakdown of the pros and cons of hiring a property manager.
Property Manager Pros
- Legality – Property managers typically are informed of your local laws and state statutes. If you’re not one to keep up to date with rental property laws, your property manager should. This is a huge advantage, as it can keep you out of trouble and can prevent you from being negligent about the legal repercussions of the way you handle something.
- Steady Income Flow – Property managers fill vacancies. If you’re not a huge fan of the process of finding the right tenant, here’s someone to take that entire process over for you. From listing and advertising to processing applications and screening tenants, your property manager will take care of it while you tend to other things.
- Rent Collection – Not a fan of hounding tenants for money? Your property manager will collect rent for you and follow the guidelines on late payments. They’ll hold your tenants accountable, and ensure your cash flow is running according to plan.
- Property Maintenance – Property managers will maintain your property. They keep their records organized, including maintenance needs and requests. They’ll perform inspections when necessary and coordinate any upgrades that need to be made.
Property Manager Cons
- Cost – There’s a price tag attached to hiring a property manager, of course. However, beyond the pay for their services, it can be typical for one of them to live in one of your units. If you have a large portfolio, one property manager won’t be able to juggle all of your units. It’s likely you will need to hire more than one or a company, which will increase your costs.
- Indirectness – Property managers are the middle man. They will take care of things, or try to, before it reaches you. Sometimes that’s not great, as you’d prefer to be alerted about an issue as it arises, not in the aftermath.
Key Takeaways: Property Managers
Property managers can add a lot of value to your rental business. If you’ve got a diversified income flow, and other things to tend to, bringing in someone to take over landlord duties will save you a lot of time and energy. Of course, this still comes at a cost.
Be prepared to both pay and house your property manager, which can definitely be worth it if your circumstances call for the help of a professional. For those with large portfolios, it could be a wise decision. For those with smaller portfolios and who are currently able to manage their landlord duties just fine, perhaps you’re not in need of more hands-on deck.