One of the ways many people attempt to get ahead financially if by investing in real estate. For the most part, it’s a sound investment choice, as property tends to appreciate in value and often you can sell it down the line for more than you paid.
And before you do that, you can earn some passive income from renting the house out. But being a landlord comes with responsibilities – you are responsible for leasing a property that is liveable and in good working order.
Many landlords choose to employ a property manager, who they pay rental management fees to and leave the bulk of the work to, for the property manager to sort.
In this article, we’re going to teach you how to understand rental management and explain the benefits of it.
Avoid the Hard Work
Managing a rental property is a task, and not everyone who invests in real estate has the time or the inclination to deal with it.
A good property manager will take care of everything for you. They will list the house for lease, shortlist suitable tenants, arrange repairs and communicate with the tenants on your behalf.
All you need to do is pay for repairs and sit back and enjoy your passive income from the property.
What Will I Pay?
This is a common question many landlords have. Like everyone else, property managers don’t work for free. They will usually be employed by a real estate firm, although freelance property managers do exist and can sometimes be a better and cheaper choice.
Typically, you will pay between 5-10 per cent of your rental yield to employ the services of a property manager. This is a pretty decent fee, all things considered. This is because the rental manager will deal with all the headaches that can come with managing a rental property.
What Are the Benefits?
The manager will deal with all the tenants’ issues, such as after-hours emergency repairs.
They will also chase late rent for you, and call in the debt collectors if need be.
A good property manager will keep you updated with anything to do with the property, and they’ll usually require your approval for any works required at the home or if the tenants have any requests.
As mentioned above, they will also manage the advertising and leasing of the property for you, freeing you up to go about your business without worrying about your investment property.
Knowledge of Law
A good property manager will be across all the various pieces of legislation that govern the relationship between landlord and tenant. Most landlords don’t have the time to read up on the various laws, so finding a decent property manager who is across this is incredibly valuable.
A vacant rental property is no good and generates no income. A property manager knows how to market a property the right way to get tenants in quickly. For this reason alone its worth investing in property management for your investment portfolio.
In this article we’ve shared a landlord’s guide to understanding property management, and also shared why investing in a property manager is a good idea.
You can avoid all the hard work and stress of managing a rental property by outsourcing this for a reasonable percentage cut of your rental yield.
A good property manager will market the property to find you, tenants, deal with the tenants’ requests, handle any hassle or repairs and will keep you in the loop. They also know the relevant laws to protect everyone in the relationship.