How does the “right” property manager enhance the value of your rental property?
No property manager can execute perfectly, but the “right” property manager knows how to keep properties functioning and making money 24 hours a day, 365 days a year.
What sets these property managers apart?
The most important thing the “right” property manager can do for you is to keep your property rented.
- In order to do this, they need to manage the tenant mix. The wrong tenant mix can destroy a property. Tenants with felony records, a history of evictions and poor credit do not help in building a strong, positive cash flowing property. At the same time, the manager has to comply with all federal credit and fair housing practices including the requirements for accepting medical assistance (companion) animals.
- It helps if the property is located in a great location, but even if a property is located in a “C” location surrounded by crime, the right tenant selection can save it. Of course, a property that is surrounded by barbed wire to keep the “bad element out” can be a bit intimidating. Property managers are not miracle makers, but they are tasked with helping owners and tenants to make a property as safe as possible. Renting to drug dealers, sex offenders or tenants without a visible way of making an income does not assist in making a property safe. A tenant’s number one requirement is to feel comfortable in their rental home/apartment and the property manager’s job is to do their best to achieve that.
Property managers need to make it easy for a potential tenant to rent a property.
- Clear and easy web access is critical
- Online applications make it easy to apply
- Ease of access to a rental unit and meeting with an on-site manager who wants them as a tenant and welcomes them to the property
- Signage at the property that makes it easy to find the on-site manager
- On-site flyer boxes with current rental information
Does the property look good?
Tenants and owners both judge a book by its cover. The potential tenant will drive on by if:
- The property does not look clean and picked up
- The property looks worn out and needs touch-up paint
- The asphalt looks old and the parking lot is not seal coated
- The landscaping is tired, overgrown or packed with litter
- The decks are cluttered
- The rental units are not cleaned, do not smell great and are not rent-ready
- The manager is not available
Behind the Scenes
Like a movie director, a property manager has to direct many pieces of the puzzle to get a property to operate properly.
- Property owners want to see monthly checks
- They want clear reporting/accounting systems that help them track the progress of their properties
- Rent roll
- Balance sheet
- Profit and loss reporting
- Aged receivable reporting
- Clear monthly property summaries
- They want their property manager and vendors to be honest
This week a client told me a story of a competitor who spent $30,000 on repairs to properties. They even supplied the bills. But when the owner inspected the property unit by unit, the repairs were not completed. Appliances were billed for but not installed, nor were the floor repairs.
Property managers should:
- Have excellent, reliable vendors who are licensed and bonded
- Make sure invoices are clearly marked by unit
- Spot check property inspections to prove that the work has been completed as invoiced
- Have vendor policies in place that protect clients, properties, and the property manager
- Make sure vendors get paid on time. Vendors that are not paid on time don’t have the financial resources to do the job right the next time
Excellent property managers:
- Train their staff continuously in the following areas:
- Customer service
- Landlord-Tenant laws
- Federal laws
- Maintenance terminology
- Emergency response
- Use of property management software and technology
The “right” property manager focuses on:
- Preventative maintenance
- Staff availability 24 hours a day – 365 days a year
- Planning ahead:
- Using an annual management plan
- Developing an annual budget and managing to that budget
- Using experience to help set a property into the marketplace so it can compete for new tenants, increase value through careful expenditures, well-planned property upgrades and rental increases
All of these items build the basis for a consistent and thoughtful property management process, but one person cannot do them all by themselves. It takes the right property management company, with the right infrastructure, vision and team of professionals.
Successfully coordinating these items with the client’s priorities in mind makes for an exemplary property manager and property management company. Property owners in search of a property manager can use this summary as a checklist to establish a short list of companies that meet their needs. Good research should lead to good results.
Does that mean you will be hiring the least expensive property manager in the marketplace? Probably not.
To maintain all of the above policies and procedures takes time, staff, experience and money. A low-cost provider will have a hard time delivering these items on a consistent basis. Rest assured, the marketplace can deliver competitively priced property managers who do an excellent job. It is these property managers who will be consistently focused on increasing the value of your property.
Sperry Van Ness® property managers are dedicated to providing excellent service. To read about the benefits of franchising for property managers, click here.