Literally, real-life. I’m giving you the inside scoop as to exactly what I get in terms of property management for my own rental properties.
I feel inclined to reemphasize, in case you aren’t familiar with property management, or even if you landlord properties yourself-
The fate of your rental property investment lies in the management of the property after you buy it.
This is not a famous quote, it is my own quote. If you buy a rental property and your management, whether managed by a property manager or by you, performs poorly, you will lose money. Quite possibly an astronomical amount of money. The fate of your investment truly lies in the hands of the management of the property.
Property Management Needed
For anyone not interested in landlording properties themselves, or if you are an out-of-state investor who is not around your properties to manage them even if you want to, property management is the way to go. Unfortunately, good property managers are extremely hard to find. I’ve said this a lot, and I wish I knew a good manager to recommend in every market, but if you know the questions to ask when interviewing managers and what to look for, you drastically increase your chance of finding a good manager yourself.
There are a ton of great articles on BiggerPockets about property management, what to look for in a property manager, and even perspectives from property managers themselves. I want to give you something a little bit different in this one. I asked my favorite property manager to send me over his list of services. This is straight from him and what he shows potentials clients. He offers three options for level of service. I thought it would be cool to show this to you so you can not only have a list of things that a property manager should be sure to offer you, but also to show you potential things property managers can offer you. As expected, these extras typically cost more, but sometimes not. I know a great property manager in an area I’m not currently invested in who does all the extras for the same price as a basic service.
Three Different Packages
In the packages below, the cost for the Basic service is 10% of the monthly rent, the Preferred is 12%, and the Platinum is 15%. I always go with the Platinum. Yes, it does cost more, but I can’t tell you how much I love hardly ever seeing repairs expenses on my monthly invoices. My repairs expenses are so minimal that I’ll gladly pay the extra 5% per month to almost never see extra expenses and to have the peace of mind of not worrying about maintenance issues.
Be sure you know what you are getting with your property management. The only thing not listed on here, that is by far the most important to me, is how well the manager communicates! That is key for me.
Cheers to property management.
Photo Credit: Thomas HawkA Real-Life Property Management Setup by Ali Boone