If you're just starting on your rental property journey, or, you’re a seasoned investor, most likely, your goal is to maximize your profits and expand your portfolio. If this is your primary focus, then managing your own investment properties wouldn't be very practical, even if you feel you're capable of pulling off the job. This is where a property management company comes in. They can successfully manage your real estate investments and ultimately funnel more money into your bank account!
Let's dive in to find out more about having your rental properties professionally managed to maximize your revenue stream.
Increase Your Profits by Hiring a Property Management Company
Maintaining a rental property comes with a significant amount of time-consuming responsibilities. In addition to this, it also requires having extensive knowledge of the subject to ensure that all your bases are covered. For instance, advertising and marketing, tenant screening, and property upkeep, are just a few of the elements that, if done properly and efficiently, will boost your profits. But, before you start searching for your dream management company, read more about finding a cash flow oriented property management team.
If you’re eager to learn more, take a look at these 7 reasons why hiring a property manager for your real estate investments will increase your profits and keep more money in your pockets:
1. Avoid Financially Draining Vacancies with Proper Marketing Strategies
An experienced property management team can literally save you thousands of dollars with their proven marketing strategies. Their advertising efforts can pull in a huge pool of candidates very quickly. This can certainly fill your rental property vacancy within a timeframe that prevents you from losing money. Also, a property management company will have the necessary experience and skills for writing compelling rental ads and creating professional photos. In addition to this, they are set up to be able to negotiate advertising rates; cutting your costs even more. Lastly, they have the know-how to host the perfect open house to successfully showcase your rental.
2. Escape Financial Risks by Weeding Out Bad Tenants
Even if you have the time to sit and interview all your applicants, do you have the experience to spot the red flags for problem tenants? A lousy tenant or two can cost you more than you realize. From lawsuits to property damage, an undesirable tenant can certainly lower your profit margin. Hiring a real estate property management company will ensure that all the proper steps are taken when searching for the perfect tenant. This would include verifying employment, checking credit and criminal reports, contacting previous landlords, and much more.
Experienced and trained property managers have an eye for spotting trouble makers. Additionally, they have a good sense as to which individuals are more likely to be reliable renters who will take care of your property. In sum, a good management property team can successfully preserve your revenue stream by placing qualified tenants in your rental properties.
3. Efficient Rent Collection Ensures a Consistent Cash Flow
Let's face it, rent is expensive these days and tough times happen. With this in mind, you can expect to have some issues with rent collection. Time is money, and if you have to spend your time chasing down rent payments, as well as taking the proper steps when a tenant just can't make that payment, it's going to affect your bottom line. Hiring a real estate property management team that is equipped to handle all situations pertaining to monthly rent collection, will allow you to maintain a consistent cash flow. It's their job to ensure that your tenants follow the lease agreement down to the fine print, which includes payment guidelines and late fees.
4. Boost Your Revenue by Achieving Higher Tenant Retention Rates
Maintaining a high tenant retention rate - keeping your current tenants from moving out, can easily be accomplished by property managers who know how to keep your tenants happy. Rental management teams have the experience to maintain good relationships with your renters. This includes such things as taking care of maintenance issues in a timely manner, conflicts with other residents, as well as keeping the property looking well maintained and attractive. Additionally, providing a rental portal for easily making payments and submitting repair requests is a bonus for your renters.
Basically, when property managers take your tenant's needs seriously and make them feel well taken care of, it will go a long way. This can keep your current tenants from moving elsewhere. In the long run, it will decrease expensive tenant turnovers, and keep more money in your pockets.
5. Save Thousands by Letting a Management Company Handle Property Repairs
By hiring a real estate property management company, you will, without a doubt, save a considerable amount of money on maintenance and property repairs. By doing so, you will be able to utilize the management company's professional and experienced maintenance staff. Plus, property management companies have access to bonded, insured, and licensed contractors who provide discounts for consistent workloads. This will not only add up to a significant savings, but also increase your property value.
6. Build Great Wealth by Investing in the Best Rental Markets
When you manage your own real estate investments, you may be limiting yourself to investing in convenient locations, as opposed to the best markets for profit gain. If you simply hire a property management company to maintain your real estate investments, you can set up rental properties in just about any location you feel is profitable. They can manage your rental to make life easy for you, as well as increase your cash flow.
For instance, let's say you live in NYC, and there is a prime rental property situated in California. It could be very difficult to manage the property yourself long distance. How would you effectively screen tenants, deal with emergencies, or, periodically check on your property from 3,000 miles away? It only makes sense to hire a professional property management team in the area to attend to the needs of your property and your tenants. It would actually cost more to maintain it yourself due to travel and lodging costs, and well as possible high tenant turnover losses if you are not able to keep up with their needs.
When seeking out new rental properties, you may want to try DealCheck. Their software will enable you to easily analyze a rental property and estimate its cash flow. This will allow you to avoid unprofitable properties, especially when you are new to the game.
7. Grow Your Portfolio by Seeking Out Other Profitable Real Estate Investments
Hiring a good property management company to handle all aspects of your property will free up the necessary time for you to seek out other profitable investments. When a property manager deals with the day-to-day tasks of your rental property, that means you won't have to. Therefore, you are able to invest time into growing your portfolio.
In a nutshell, your job is not to service properties; you're an investor. So, let the professional property management companies service your rental properties for you. That's what they're there for. If you manage your own properties, you can only grow your portfolio up to a certain point, and this will cap your revenue. Are you starting to see the big picture now?
If you want to effectively and quickly grow your portfolio, you should check out our free Freedom Cheat Sheet. It will allow you to reach financial freedom by finding your specific Freedom Number. The Freedom Number formula calculates the number of properties needed to fully cover your expenses, enabling you to strategize your way to financial independence. Additionally, if you need help managing your rental, or, if you are looking for a new property to invest in, the team over at Morris Invest can assist you. Contact us for a 30-minute consultation to jump start your real estate goals today.
If You’re Not Ready to Hand Your Property Over Just Yet...
Are you’re feeling like utilizing a property management team is the right choice, but you’re just not ready to take that step yet? If so, we have a few resources that will help you manage your rental property until you take the leap and let a management company take over the reins.
Innago - Free Tenant Management Software: This outstanding property management software offers effective tools such as a tenant portal, online rent collection and lease signing, maintenance ticket information, tenant screening, QuickBooks integration, an easy application process, and a much more. This helpful tool is free and will make your life easier!
Stessa - Professional software that will seamlessly keep track of your property performance, finances, and the paper trail from your rental properties.
eForms - Simplify the complicated form process by utilizing eForm’s Rental Application and their Residential Lease Agreement. This company will provide you with professional forms to easily complete the renting process.
You Can Fast-Track Your Financial Independence When Using a Professional Property Management Company
As you can see, managing your own properties can end up being a full-time job that's better left to the professionals. Hiring a rental property management company will keep your tenants happy, ensure your property is well maintained, and increase your profit margin. Furthermore, letting a professional team manage your investments will not only put more money in your pockets, it will also allow you the freedom of making passive income and enable you to enjoy more time with your friends and family, which is priceless.