Managing rental property can initially seem daunting. But with the right strategies and a clear understanding of your responsibilities, you can become an efficient landlord and maximize your investment. In this guide, we'll explore and help you evaluate how to manage your rental property, whether you choose to do it yourself or hire a property manager. Let's dive in!
You can become a savvy property manager with dedication, hard work, and solid coverage of the basics.
First, you'll need to buy a profitable rental property. If you’re looking for San Francisco rental property, West Los Angeles rentals, or Massachusetts rental opportunities, we’ve put together guides for investing in these real estate markets.
Doing a thorough real estate market and investment property analysis is the best way to ensure you buy a good rental property with long-term value.
Once the necessary repairs are done, set your rental rate by performing a rental market analysis to know the average rental rate of comparable rental properties in the area. You can use Doorstead to estimate your property value, as we utilize hundreds of real-time local data points to find the optimal value to rent.
How to manage your own rental property? When managing a rental property, you need to focus on the following responsibilities:
Managing rentals requires a lot of time and effort, but how long it will ultimately take depends on how many rental properties you own.
Time commitment varies based on the number of properties you own, tenant turnover, and the property's condition.
It's essential to understand that managing a rental property without a property manager can be challenging and time-consuming, especially for first-time landlords.
For one or two rental properties, it usually takes a few hours a month to manage them, with the majority of that time spent on getting the property rented and then tending in real time to maintenance issues that might come up. Hemlane shares that an owner spends roughly 4 hours per month per rental property. That rounds out to around 48 hours per year for daily operations.
It takes significant time for more properties, and getting help is advised.
Managing a rental property requires a lot of work. If you want to manage your rentals, you must be prepared to spend time and energy, especially if you’re a first-time rental homeowner.
To manage a rental property without a property manager, you’ll be in charge of every aspect of the business, from sending out rent reminder emails to completing repairs and bookkeeping. This route can save management fees but be much more time-consuming and stressful as you’ll be responsible for handling everything yourself, 24/7.
Managing a rental property without a property manager requires significant time, effort, and familiarity with local real estate laws.
Having a list of reliable, professional contacts for contractors, inspectors, landscapers, and maintenance teams is a great practice to implement as an individual property manager.
To help you better understand property management's scope, industry, and general responsibilities, we put together a comprehensive guide and outlook on residential property management.
Managing a rental property remotely can be challenging, but it is possible with the right strategies and tools. We’ll outline best practices and how you can manage rental property remotely below.
Since managing rental property remotely is a question that is being asked more and more as we become accustomed to remote work and continues to move around for work and lifestyle, we’ve put together specialized tips on how to manage rental property remotely.
You can manage your rental property remotely and keep your tenants safe and satisfied by researching property management and following best practice tips.
Doorstead is an excellent remote rental property manager for any out-of-state properties you might own. We are top-rated property management in the San Francisco Bay Area, San Diego, Los Angeles, Orange County, Seattle, and more.
See how Doorstead has helped first-time rental homeowners profit passively when faced with sudden moves and the resulting property management needs.
When managing rental properties, homeowners have two main options: they can learn how to manage their rental property themselves or hire a property management company to do all the work professionally. Making this decision comes down to your individual preferences, needs, and resources.
If you feel uncomfortable managing your rental property, consider hiring a property management company to do the job for you.
Doorstead offers a Guarantee service for certain rental properties that guarantee a monthly cash-flow amount, regardless of whether a tenant is placed. Our guarantee provides peace of mind and passive profit to busy rental homeowners. See if Doorstead’s will be a good solution for your property management needs.
When hiring a property management company, there are several things to consider, such as:
Costly property management services can cost tens of thousands of dollars a year, so knowing if you are getting your money's worth is important. It is also important to screen prospective managers and have a clear exit strategy should things not work out.
When managing properties remotely, consider the availability of professional and reliable contacts for various repairs that may arise. Furthermore, you should ensure that your tenants are managed properly and that all money spent on maintenance is accurately recorded.
Additionally, hiring an accountant to do your taxes and set up separate bank accounts for business expenses is a wise choice.
Here’s Doorstead’s guide on hiring property management that can help you evaluate the right fit for your rental property management needs.
The disadvantages of hiring a property manager include costly fees that may come with the service, the potential for mismanagement that could destroy your business, increased rental income due to property management fees, potential dishonest practices on the part of the property manager, less control over the property and its operations, and having to bear the burden of any property-related legal issues.
Additionally, there may be a lack of communication between the property manager and the landlord if the property is located in a different area, and a potential for the property manager to overcommit and be overwhelmed with too many properties.
Hiring a property manager can be beneficial in many ways, but there are also some drawbacks.
On the plus side, property managers can provide a wealth of knowledge and experience to help you maximize your rental investment. They can help you maximize your rental income, provide optimal rent, reduce vacancies, and find the best vendors. Hiring a property manager also simplifies your life and reduces stress by handling tenant-related issues such as rent collection, maintenance, and eviction. If you decide to go with a property manager, you may be able to deduct the expense at tax time.
On the downside, hiring a property manager can be costly and ineffective, with fees running into the tens of thousands of dollars each year for poor results. There’s also a risk of mismanagement or dishonesty, potentially destroying or harming your property or ending in a lawsuit from the tenant.
Hiring a property manager can make your life easier, but you must do due diligence to ensure you pick the right option.
Property managers typically charge a percentage of the monthly rent (usually 8-12%) or a flat fee. Additional fees may apply for tenant placement, maintenance, or evictions. Each property manager individual or service has their own terms on costs and payment methods.
Ask the property manager what services they provide and if they have any additional fees. Reputable property managers should clearly list out fees and charges and be able to answer any questions you may have about pricing. Some property managers may also charge a leasing fee, which could be one-half or one month’s rent.
Here’s a glossary of important property management fees and terms when navigating this conversation with your prospective property manager.
Before signing a contract, discuss tenant selection criteria with the property manager. A property manager will not always have the same values or responsibilities as the homeowner, so they may not handle matters similarly. Remember that although using a property management company will cut your profits, it will save you time.
A property management maintenance request is a request for repairs or maintenance submitted by tenants to the property manager. This can help landlords manage maintenance requests efficiently and effectively, freeing their time to focus on other tasks. Additionally, having a maintenance request system allows landlords to track requests and keep tenants informed of their progress easily.
Depending on the property management tool used, this request can be submitted online through a tenant portal or other means. The property manager will then evaluate the request and determine how it should be handled by assigning it to a contractor or completing the task themselves.
Making property management maintenance requests is an important part of owning rental properties. It helps ensure that issues are dealt with promptly and efficiently.
RentPrep has a great guide on all the considerations in a property management request form. You can find a variety of premade property management maintenance request form templates at TemplateLAB. Jotform also has maintenance request forms under their Work Request Forms category.
Managing a rental property can be challenging, but you can successfully manage your own rental property with the right approach and commitment. Whether you manage your property yourself or hire a professional property manager, understanding the responsibilities and strategies involved is crucial. By utilizing different resources and researching before jumping in, you can maximize your rental property investment and enjoy a rewarding experience as a property owner.
If you're considering working with a property management company, learn more about Doorstead's full-service property management and our win-win approach. Insider recently voted us to be one of the hottest proptech companies in 2023, and you might love what we have to offer.
Did you find this article surprising or helpful? If so, please share it! And if you're looking for more helpful tips and resources on property management, visit the Doorstead blog.
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