The Big 64-Point List of Landlording Tasks (& How to Outsource the Vast Majority of Them)

by | BiggerPockets.com

Let’s talk about the common tasks you might perform as a landlord. This will give you just a sample of the kind of tasks a landlord is responsible for.

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64 Tasks Landlords Are Responsible For

  1. Preparing a property to rent
  2. Collecting forms needed for the businesses
  3. Placing ads in the newspaper and/or online
  4. Placing signs in the yard
  5. Determining fair market rent
  6. Determining the security deposit amount
  7. Setting minimum qualification standards
  8. Taking phone calls from prospective tenants
  9. Pre-screening tenants
  10. Scheduling appointments to show properties
  11. Meeting with prospective tenants
  12. Answering questions about the property
  13. Selling the property’s features (yes, landlording is about sales!)
  14. Distributing and accepting applications
  15. Screening tenants
  16. Calling former landlords
  17. Verifying prospective tenants’ income
  18. Running background and credit checks
  19. Approving great tenants
  20. Denying tenants who aren’t great tenant material
  21. Ensuring compliance with Fair Housing Laws
  22. Accepting the deposit to hold
  23. Scheduling a lease signing
  24. Signing the lease and addendums
  25. Inspecting the condition of the rental before a tenant moves into the property
  26. Setting up the payment method for the tenant
  27. Accepting rent and depositing rent into the bank
  28. Making sure utilities were properly transferred
  29. Getting copies of the lease to all parties
  30. Creating a tenant file to house their information
  31. Accepting phone calls from tenants
  32. Dealing with maintenance requests
  33. Settling disputes between tenants
  34. Raising the rent when appropriate
  35. Ensuring tenants comply with their lease
  36. Ensuring tenants keep the property in good condition
  37. Scheduling regular inspections of the property
  38. Finding and maintaining a list of reputable, licensed contractors
  39. Managing contractors to make sure the work gets done
  40. Checking the progress on any repairs and ensuring tasks are completed
  41. Paying contractors and dealing with the legal paperwork
  42. Dealing with late rent and getting the required legal forms served
  43. Evicting bad tenants
  44. Dealing with tenants who may be on drugs
  45. Making sure the property is always operating up to code
  46. Firing tenants, if needed
  47. Accepting notices to vacate and overseeing the transition
  48. Bookkeeping to keep track of income and expenses
  49. Keeping a record of tenant communication
  50. Monitoring and paying the bills that the tenant doesn’t pay
  51. Monitoring the lawn care and landscaping
  52. Balancing the checkbook and accounts each month
  53. Producing monthly reports on the financials of the property
  54. Responding to legal threats against the landlord
  55. Performing a move-out inspection of the property after a tenant vacates
  56. Handling the repairs or repainting after a tenant moves out
  57. Getting the tenant’s security deposit returned or applied toward repairs
  58. Scheduling a carpet cleaner and someone to change the locks
  59. Maintaining property management licensing, if needed
  60. Staying up to date on rental-related local, state, and federal laws
  61. Keeping the tenants happy as much as possible
  62. If managing for other landlords, keeping owners happy as much as possible
  63. Keeping the property running at peak performance
  64. Starting back at the beginning of this list and doing it all over again for each property

BRRRR-strategy-deal

Related: I’ve Broken Every Lease I Ever Had: Here’s What That’s Taught Me as a Landlord

Wow! To be honest, that was the first time we’ve ever sat down and tried to list every single thing a landlord does—and it’s overwhelming, isn’t it? Now, multiply that list for every single unit you own, and it’s easy to see why so many landlords fail at this game. From the outside, most people see landlords as doing two tasks—accepting rent and fixing things when they break—but clearly they are doing a bit more than that!

We didn’t include this list here to scare you, but to give you an idea of all the moving parts that are in store for you. The good news is that nearly everything on this list will become repetitious and easy for you to handle. And if you are anything like us, you might even end up loving the process. If not, you could always hire a property management company to do it for you. Let’s talk about that.

Should You Hire Professional Property Management?

What if we told you that you could easily condense that HUGE list we just talked about into just a few bullet points? Actually, you can—but it’s going to cost you. Professional property management companies exist to take care of most of the above list for you, everything from finding tenants and signing leases to answering phone calls, dealing with turnover, and more. When you hire a property management company, you don’t even have to ever meet the tenant.

Property management fees vary by location, but typically for a single family house or small multifamily property, you’ll be looking at 8–12 percent of the rent in a monthly fee and a large, one-time fee each time the unit is rented. This placement fee is often 50 percent of the first month’s rent all the way up to the entire first month’s rent. In other words, if your property will rent for $1,000 per month, the property manager might earn $100 per month for their management, plus an additional $500–$1,000 each time the property is rented. Some managers also charge a “renewal fee” each year, as well as “marking up” the maintenance costs. For a property owner who doesn’t have a lot of cash flow, property management can quickly turn a decent investment into a negative cash-flowing investment.

Of course, the other side of the coin is that by allowing a manager to look after a property, it frees up the investor to do “higher value” tasks, like finding more properties. If a management company costs $2,000 per year, but the time saved helps an investor buy one more property per year that nets him or her $5,000 in cash flow, then the savings might be worth it. Or perhaps you are simply not interested in learning how to become a good landlord and you are going to be just like most other failed landlords. In this case, it would be better to pay the $2,000 per year to avoid losing tens of thousands on your investment.

Now, keep in mind that hiring property management is not going to be perfect. The truth is, a lot of property management companies are terrible.

Becoming a property manager is not a difficult task, so the market abounds with managers who have no idea what they are doing. They saw property management as an “easy” way to make money and decided that managing tenants would be the way to go. At best, these managers are terrible at getting units rented, horrible at communication with the owner, slow at getting repairs completed, and allow the tenant to let the property fall into disrepair. At worst, they could steal, lie, and cheat their way into the owner’s pocketbook and completely destroy an investment.

build-relationships

Related: 6 Advantages to Hiring a Property Manager (& Why I Wish I Did Sooner)

Managing Your Property Manager

Even if you hire a great manager, your job as the owner is not completely “work-free.” You must continue to manage the property manager and ensure they are doing their job correctly. Perhaps the biggest complaint from owners about property management companies is “they just don’t care about my property.” And with hundreds or even thousands of properties under management, it’s probably the truth. Your property does not stand out to them from the others. When they have 50 vacancies at one time, yours included, they are trying to fill all of them at once. They don’t have an incentive to get just yours rented, which could cause the property to sit vacant longer. On the other hand, professional property management companies have a much wider reach for finding tenants due to the marketing they run. While you might put up a Craigslist ad or sign in the yard, they may have hundreds of signs and ads all over town, with dozens or hundreds of potential tenants calling every week. They also may negotiate “bulk rates” on their services, which could bring down the cost of some maintenance.

If you do decide to hire a property manager to run your rentals, do your due diligence and find the best manager in your town. Ask other local landlords for referrals, interview dozens of companies if you have to, ask the hard questions, talk with their current clients, and don’t be afraid to fire a bad manager. And keep reading this book, as it will help you build a baseline for what a good landlord should do, helping you become a much more effective manager of the manager.

But our guess is that because you are reading this book on how to be an effective, successful landlord, you are interested in managing yourself. We have managed our own properties since day one. On the couple of occasions we have attempted to hire a property manager, we leave with the realization that we do things ten times better! We don’t say this to brag; we say this to inspire. It all comes down to knowing that nobody cares about your property or about your investment as much as you do. Anyone can manage, but managing effectively is a skill that must be learned and perfected.

[This article is an excerpt from Brandon Turner’s The Book on Managing Rental Properties.]

Which of these tasks do you choose to outsource to hired management and why?

Let me know your experiences with a comment!

About Author

Brandon Turner

Brandon Turner (G+ | Twitter) spends a lot of time on BiggerPockets.com. Like... seriously... a lot. Oh, and he is also an active real estate investor, entrepreneur, traveler, third-person speaker, husband, and author of "The Book on Investing in Real Estate with No (and Low) Money Down", and "The Book on Rental Property Investing" which you should probably read if you want to do more deals.

6 Comments

  1. Christopher Smith

    Frankly I can’t think of many things I would rather NOT do than property management. So for me a property manager is a total no brainer and really more than that its mandatory. I’ve worked with two managers (one local, one distant) for many years and IF you can find a good one you will save yourself a mountain of grief, hassle and legal liability.

    Mine charge a flat 8% and they do virtually everything and do it pretty well. In the beginning I thought 8% was maybe a little high, but when I think of me having to do all that they do its really a good deal. Unless you are really into all the aspects of this business (and some are), leave the day to day management to a solid professional and focus your time and efforts on the long term strategic development of your rental business.

    Of course this all comes with a huge caveat, you MUST find a professional, knowledgeable and diligent management company and you must be willing to manage your manager from time to time. They need to know you care before they are going to really care about your stuff. Property manager selection/management can itself be a very challenging task since there are some real dirt bag operators out there that call themselves property management specialists and will promise you the moon and the stars (with no real intention of delivering) just to get your business.

    If you do manage to get a good one, cultivate that relationship very carefully because when the “you know what hits the fan” (and sooner or later it will) these are the guys that will be covering your backside. They can either be your savior or your nemesis, and no one needs the latter.

    • Alan Mackenthun

      I’ve been managing our own from the beginning almost 10 years ago. I can’t imagine paying 8% of rent for property management plus extra for filling units and maintenance. Cashing checks month to month is not that hard. It’s really about the most enjoyable part of the business. With 12 units in almost 10 years I’ve never had to do an eviction. I think that’s due to being in reasonably close contact with the tenants.

      • Christopher Smith

        I would say you are likely not using your time very efficiently then. Property management while vital is very routine work and gets compensated accordingly. If you view your time as truly valuable (as I do mine), you should likely be devoting it too long term strategic acquisition and planning not playing the building sup or cashier clerk or performing other minimum wage activities.

  2. Olatunbosun Idowu

    Great one Brandon,
    Once again you have spelt it all out, what property owners must be prepared to do if they want to manage their property asset investment by themselves and what to look out for if they consider hiring a property manager or management company for an effective, efficient and successful portfolio management. I really don’t see anything wrong in hiring a honest, diligent and trustworthy property management company to manage investment portfolios considering what what they put into ensuring increase in owners earnings and assets value.
    Thanks for sharing this post with members
    Olatunbosun

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