Is Hiring a Property Management Company a Profitable Strategy?
Many property owners have their own thoughts and opinions regarding property management companies. Many see them as a luxury for landlords. However, there are definitely instances where a property management company is well worth it. If you are newer to property ownership or have not taken the time to fully investigate the benefits of property management companies, here are a few things to consider when determining if using a property management company is a profitable strategy.
As we approach the end of the year, this is a great time to sit down and check in on your rental income finances. What are your gross revenues and what are your greatest expenses? Were your rental properties rented to their fullest capacity? Did you get the most income you could on your properties? As you consider where the shortfalls might have been in your strategy, now it’s time to examine what types of benefits property management companies have to offer.
- Marketing, If you find that your property sat vacant for too many days this year, consider the outreach that a property management company can provide. Many companies provide a regional and sometimes national presence, ensuring high rates of tenancy.
- Distance. If you are not co-located with your rental property, many concerns or issues with tenants can remain unresolved. This can result in unpaid rent or disagreements with your tenants, resulting in high turnover. Property management companies can provide a buffer between tenants and landlords. They can also find repair people quickly and at a fair price, avoiding such issues from ever arising.
- Vetting Renters. The process of vetting a renter can be time-consuming and costly. Many property management companies already have a rigorous process in place.
- Short Term Rentals. If you own a short-term rental property, property management companies can be involved as much or as little as needed. Many can do it all, but if you prefer to be the one to give the access codes to enter the property, you can request this.
Many property management companies take a percentage of the gross revenue as a fee, while others have a set fee. Before hiring a property management company, determine where your needs lie, how this particular company can help and what it will cost you in the end. The profits may be huge.