In most cases, landlords assume by managing their property themselves they are saving money. It can actually cost them money if they are not aware of regulations, good contractors, not knowing market rates or having the ability to select good tenants.
Property managers have the experience, expertise or resources to maximise your income and make life easy.
Reduced vacancy periods
Every day a property is vacant, it costs you money, so the less time your property remains vacant, the better it is for you.
Using a property management service that knows the market, can select the best agents in town to get the maximum exposure for your property can mean the difference between months on the market or just a few days.
Also, well-managed properties tend to retain tenants, so you will have fewer vacancies in the first place. The typical vacancy costs at least one month’s rent, plus the additional expenses of cleaning, changing the locks, painting damaged walls, possibly installing new flooring, making repairs and other improvements, marketing and more. If you can reduce the number of vacancies you have, you save money as a landlord.
They tend to select higher quality tenants as they will be the ones dealing with the bad ones. A bad tenant mean potentially; unpaid rent, eviction costs and extensive damages can add thousands of pounds.
Selecting a high quality tenant is just one of 10 ways a property manager can save you money. What you would pay for the average, no hassle, easy-going vacancy. If you had three or four bad tenants back to back, and no matter how well you initially invested and chose your property. It can suddenly become a money pit.
You make no money when the property is vacant, and you can actually lose money if you rent to the wrong tenant. Choosing the wrong tenant for the property is the biggest money loser that is out there.
A good property management company will see the warning signs often that may be overlooked by a landlord.
The legal costs of defending and even proving you are right, can exceed the value of the property. A professional property manager is cheap insurance against such a possibility.
Reduced maintenance costs
When your property has a maintenance issue or needs a repair, you can benefit several ways by working with a property management company that has access to good reliable insured contractors.
These will be contractors with whom the property management company has a good relationship, so you know they carry out high quality work, something you can’t be sure of if you try to find a handyman on your own. Low quality work eventually will cost you.
Since the property management company deals in volume, it can usually secure reduced rates for the contractor’s services. You may end up paying less for the work, and depending on the repair, that discount could save you several hundreds of pounds. Property management company will do the vetting and comparing prices for you.
Increased buying power
Volume discounts aren’t only limited to contractor’s fees. Your property management team will probably be able to offer it for less than the market rate as they would have access to the best lawyers, cleaning services, carpet cleaners, grounds maintenance, accountants, builders and insurance representatives.
Other discounts and savings might surprise you. For example, property management companies should be able to secure no banking fees. A DIY landlord probably won’t get a discount at all.
Monitors Rent Collection
If you let your tenants walk all over you they will, especially when it comes to paying the rent. Since consistent cash flow depends on collecting the rent on time every month, you need to be firm. Regardless of whether the tenant has broken up with her boyfriend or lost her job, they have to pay their rent on time.
When you hire a property manager, you put space between yourself and the tenant. You don’t have to listen to the excuses, chase down the rent or, if it becomes necessary, evict the tenant. Your property manager takes care of all that. As they are trained to handle difficult tenants, a property manager isn’t going to be susceptible to a hard-luck story. He is simply going to enforce the lease.
A DIY landlord will often have a more difficult time sticking to the terms of the lease and tends to be more susceptible to excuses, which could lead to skipped rent payments and a delay in the eviction process. Using a property management company mitigates this potentially disastrous situation.
Less legal issues
A good property management company knows all applicable laws and regulations and have easy access to lawyers. Policies will be in place and strictly enforced so there are no violations. For example, the property management company will have set guidelines for qualifying tenants
A good property manager can really save you a lot of time and money in the courtroom or even avoid you ending up in court.
More time for you
Time is money, and your time can be more profitably spent at your day job or finding other investment properties. Your time can be better spent with your family on the weekend or travelling instead of taking a midnight phone call for an emergency repair.
A property management company can lease your property, qualify tenants, collect rent, deal with phone calls, handle repairs, renew leases, enforce the lease and evict tenants. One lawsuit avoided or one less month with a vacant property can cover the cost of hiring a property management company.
Most landlords have property managers because of their expertise and management knowledge but also because they don’t have the time to deal with the day-to-day management of their portfolios.
Property management companies offer peace of mind, the assurance that you can go on with your life without having to worry about your property. That is priceless.
Competitive rent rates
If you overprice your property, it could stay on the market longer than necessary. Under price your property, and you leave money on the table. A property management company will study local market data to determine a competitive rate.
Interior and exterior inspections help minimise damages. If the tenant is damaging the property, you can address the issue early, hopefully, before the repairs become too expensive. Your property manager will keep an eye on your property.
Contact Pelin Martin for your 30-minute complimentary consultation with Blue Crystal Property Management London and check her West London Property Networking Group. Call her at 07957 358 959 or 0208 994 7327