Being a landlord is more than just owning a property. There are a vast number of tasks and responsibilities that come along with it and balancing them all can be stressful.
Fortunately, there are options you can explore to lighten the load and maintain a healthy, sustainable relationship with your tenants.
One of the easiest ways to reduce the managerial load of being a landlord is to hire a property management firm. But knowing when to utilize one can be tricky. How do you know when you need help? Asking yourself these 10 questions will help you determine whether a property management firm is your best option.
1. Do you own multiple properties or units?
The more properties you own, the more responsibilities you have. Managing multiple houses or apartments, as opposed to one, will mean a drastic increase in the amount of time and effort needed to maintain them effectively.
If you do happen to own multiple properties or apartment units, that’s certainly an incentive to obtain support from a property management firm. Unless you have extensive experience in property management, handling multiple properties is a massive undertaking.
2. Do you live far away from your rental property?
The distance from your home to your rental property is certainly a determining factor in whether you should hire a property management firm. If you live nearby, it will be easier to address certain issues that crop up, such as a leak, break-in, or trouble with tenants.
But if you live far away, when urgent scenarios occur—which is inevitable in the long run—fixing these kinds of problems will become unnecessarily difficult. A property management firm with closer access to your rental property can handle emergencies far faster and with greater efficiency.
3. Do you struggle with interpersonal management?
Being a landlord requires communicating and managing different people and personality types. If interpersonal management is not your strong point, you may struggle to resolve conflicts with tenants or manage their requests in a way that is simple and straightforward.
Property managers, on the other hand, are especially skilled in this area. So, the next time a tenant makes an unreasonable complaint or causes damage to the property, you won’t have to go through the stress of resolving the situation.
4. Can you afford the cost of a property management firm?
If you can afford to hire a property manager, you should. The benefits you receive in terms of lifted accountabilities and tasks are well worth the cost, and they will significantly ease the weight of your other work/life responsibilities. However, you need to ensure that your budget allows for it. If your rental income just covers the mortgage and other related costs, you may have to pay out of your own pocket.
5. Do you feel overwhelmed with management responsibilities?
Acting as a landlord for a rental property is kind of like a full-time job. But chances are you already have one of those. If your workload is already high and you’re feeling the pressure to perform, it could be helpful to invest in some support for your property management duties.
If it’s practical for you financially, the decision to obtain professional help for managing your rental property is low effort and high reward. You still have all the power regarding major decisions, but the time-consuming admin side of things becomes someone else’s responsibility.
6. Is your property part of an affordable housing program?
If your property falls under the affordable housing program category, renting it out can become complicated. Within the structure of these programs, landlords are typically given benefits in the form of tax credits, a grant, a low-interest loan, or financial assistance of some kind.
But to continue receiving that support, landlords are required to adhere to numerous new rules and regulations, many of which change over time. Dealing with all of this on your own can be overwhelming, but not if you have a property management firm to guide you.
7. Do you struggle with your existing tenants?
Difficult tenants are not uncommon. If you’ve got a tense relationship with yours, it might be to your benefit and theirs to bring in a neutral third-party such as a property management firm. They can take on the responsibility of meeting everyone’s needs in a fair, logical, and legal manner.
Even if you continue to manage tricky tenants yourself, it’s still an excellent idea to put other safeguards in place. Having landlord insurance should be a priority, as not only will it protect you against damages tenants cause, but against theft, fire, flood, and lost rental income.
8. Do you have a lack of knowledge of rental property management?
Plenty of people invest in property, but few of them are truly equipped with all the legal experience and knowledge needed to do it well. If you feel uncertain about your ability to manage your property in a smart, law-abiding, or optimal way, hiring a property management firm is a very useful option.
When you buy a rental property, there are so many things you need to learn to make it work in the long run. But you can shift that responsibility to someone else via a reputable property management firm.
9. Do you intend on growing your property portfolio?
Property is a great market to invest in, which is why so many people are doing it. However, if you intend to continue investing in more properties and grow your portfolio over time, you may become overrun with the responsibility of managing them all.
Managing advertisements, tenant requests, marketing, maintenance, and more is no simple feat, especially as your little empire begins to grow. If you were to opt for the support of a property management firm, you could take a much more passive role and focus on other responsibilities.
10. Does a “hands-off” approach appeal to you?
When it comes down to it, what you need to consider is simply if the passive landlord approach appeals to you more than the active one. If you’ve got business in other areas or simply aren’t enthusiastic about property management, outsourcing support is a hugely beneficial decision.
Hiring a property management firm means more time and energy to focus on your career, family, and personal life in a way that’s much more flexible and laid back. If you answered yes to one or more of these questions, then a property management firm is the right choice for you.