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What could owners expect from their property managers?

A good property manager can easily become one of your greatest assets, second only to the properties that they look after on your behalf

A competent property manager can add significant value to your investment and maintain the existing value, which is why many seasoned real estate investors will tell you that a good manager is worth their weight in gold.  Here is some of what you can expect from a professional property manager:

Protecting the value of your investment
A professional property manager will help ensure that your property’s full value is realized over the length of the investment. A way to achieve this is to put systems in place that catch and deal with maintenance and repair issues early on, before they grow into larger more costly problems. The property manager can also offer you suggestions and feedback on upgrades and modifications, both how they will affect the rent you can charge, as well as their impact on maintenance and insurance.

Lower maintenance and repair costs
Good maintenance and repairs keep tenants happy and preserve the value of your investment which makes them a very important part of running a successful commercial property. When hiring a management firm, you can expect to gain access to both their in-house maintenance staff, as well as their network of licensed, bonded and insured contractors who have already been vetted for good pricing and quality work. A good property manager should also knows the contractors and understand maintenance issues such that they are capable of intelligently supervising the work.

Stricter rental collection process 
The way you handle rent collection and late payments can be the difference between success and failure as a landlord. Collecting rent on time every month is the only way to maintain consistent cash-flow, and your tenants need to understand this is not negotiable. Property managers should put a buffer between yourself and the tenant. They have an advantage because tenants realize that they, unlike the owner, are only doing their job and are obligated to enforce the lease terms. 

Regarding evictions, there are strict laws concerning the eviction process, and doing it wrong, or trying to evict a professional tenant can be a major drama. A good property manager should know the law and has a good process for obtaining the best possible outcome given the circumstances. Never having to handle another eviction can be a compelling reason to consider hiring a professional property manager.

Increased tenant retention
While it is easy to see the effects of lost rent, there are other equally serious problems with a high tenant turnover rate. The turnover process involves a thorough cleaning, changing the locks, painting the walls and possibly new carpet or small repairs, not to mention all the effort associated with marketing, showing , screening and settling in a new tenant. This is a time-consuming and expensive process that can often be averted by keeping tenants happy and well cared for.

A good property management company will have a time-tested tenant retention policy that ensures happy tenants with lengthy stays in your properties. These kinds of programs require a consistent, systematic approach, which is where a good property management company will shine.

Fewer costly and time consuming legal problems
Experienced landlords know it only takes one troublesome tenant to cause significant legal and financial headaches. A good property manager should be equipped with the knowledge of the latest landlord-tenant regulations and will ensure that you are not leaving yourself vulnerable to potential legal actions. Each country has their own laws, these cover a number of areas including but not limited to:
Tenant screening 
Safety and property conditions of the property 
Lease addendums 
Terminating leases 
Handling security deposits 
Rent collection 

Avoiding a single legal issue can more than pay for the property management fees, and spare you time and anguish.

Assistance with taxes
A professional property manager can help you understand which deductions you can claim, as well as organize the necessary forms and documentation to make those claims. Additionally, the property management fees themselves are also tax deductible.
Personal benefits for owners
  • Less stress - Avoid having to deal with middle of the night emergencies, chasing down rent, evicting people from your property, tenants who wreck your property, rental scams, lousy vendors, piles of paperwork. 
  • More freedom - Live and invest wherever you want with the constraint of needing to be near your properties. Additionally you can live and travel without the requirement of always being available in the event that your tenants have a need you have to tend to. Once you have found a good property manager, it doesn’t matter if you live in the same state. Some landlords live in other countries and simply collect their check every month without ever seeing the property.
  • Free up more of your time - Time is money, and for many investors, their time can be more profitably spent in areas other than servicing their properties. When you focus on asset management you’re working on your business, when you manage your own properties you work in it. Additionally you have more time to spend with family or friends doing things you enjoy. 
A final thought
Of course, this is an ideal scenario.  These results can only be expected if a property manager is competent, trustworthy and a good fit for your property.  A poor choice of a manager can produce many headaches of its own.

Author: Dexter Norville, Director of Property and Asset Management, JLL