It has become more and more difficult to stay ahead with the tough economical times ahead. Especially with some economists still argue that we haven’t quite recovered from the 2008 depression, being show cased by the recent economical turn oils, world wide. It would be for this argument that it is even more important to manage your property portfolio as a business and not a hobby. Hiring a property management company can save you all the time, frustration and resulting in you being a profitable landlord. Far better than what you would have managed as a part-time DIY landlord.
A Property Management Company will save you time and money.
There is no question about it, a property management company will save you time and money, never mind your sanity. Managing your own property portfolio can be a full time job on it’s own.
Trying to manage your property investment on a full time basis with the actual time of less than part-time,
well let’s be honest,
you will not get the return on investment your property deserves.
Owning a property portfolio does put you in a safe financial spot, but this doesn’t mean that it doesn’t come with its own time consuming tasks, such as:
- Marketing your rental property
- Screening your potential tenants
- Managing the Checklist process
- Signing a legal and accepted Lease Agreement
These are but the first step to the process, so far so good, not too many problems yet. Many landlords feel that they can manage this step themselves. This is more than possible, but consider the management and maintenance of your rental property with the more permanent and problematic tasks, such as:
- Managing late tenant payments, these can lead to evictions.
- Managing Tenant Complaints
- Repairs and Property Maintenance, they already have a A-Team of Vendors
- Preparing your property for new tenants with a new checklist
- Finding new tenants and dealing with bad tenants.
A Property Management Company Understand the law
Our country may honestly be the colourful-est of counties, but as with all shades of colour there are the darker shades too. We, South African landlords need to be careful to ensure we are always on the correct side of the rental property law. Our laws are written in a fair manner, but in reality we have often find that the court does take a lack of education and opportunity very much inconsideration when it comes to rental tenants.
It is for this reason that you would thank your stars for choosing to go with a property management company if your are ever unfortunate enough to have to deal with an eviction. Many new landlords often make the mistake to be kind and allow their tenants a few months of back payment, but these acts of kindness can actually do your legal eviction case more harm than good. It is for this reason that property management companies should handle these matters. Landlords can get too personal and emotionally involved. The key to an eviction success is to stay professional. The eviction process is again for the sad extreme, a sad reality for any property owner, inconsequential of your property investment type.
There are however normal legal matters that a property management company will manage for you, such as:
- the Lease Agreement and rental deposit management
- the Checklist and visual recordings
- Credit Checks and Criminal Record Checks
A Property Management Company Understand the Property Rental Market
It is understandable that new landlords may often ask too much or too little for their renal unit, especially at the start. This can however be somewhat detrimental as starting to high could cause a few months of no, or little interest in your property, increasing your unoccupied rental rate. Asking too little again can result in unwanted tenants, not to mention that you are fixed to that rental rate.
You rented your property for 10% less than what you actually could have rented it out for, due to a lack of experience.. School fees, right.
Normally we would say that we (landlords) will just increase the rent next year by 10% more, making up for the rental lost. This may be good and all, but you are also now forgetting the normal inflation increase you would have asked anyway, whether the property was rented at the correct rental rate or not.
If you were to include the 10% rental loss + the 7% inflation you would have a total of 17% increase in rental rate. This is tooo much, as no tenant will stick around for a 17% rental increase. As such this small calculation cost can cost you in the long run, especially if you have a tenant that decided to stick around. Remember also that you are limited to what you can legally ask for a year on year rental increase, normally no more than prime+1. These are the school fees that you rather want to pay into your property management company’s commission fee.
Small school fees can be costly and even detrimental to your rental property portfolio’s financial success.
Considering the cost of your property investment you want to make sure you choose the best property management company for the job. It is for this reason that we compiled a list of 32 Questions for your new property management company, ensuring the best property management company gets the job.
- Landlords should understand Wear and Tear
- 10 Landlord questions for a Reference Check
- 10 Mistakes New Landlords Make - Part 1
- 10 Mistakes New Landlords Make - Part 2
- Landlords need to manage their Property Maintenance
- Your A team property vendors list
- 6 Tips to renting out your home
- 5 Traits of a Profitable Landlord
- Should tenants paint, why yes Sir
Legal Matters for Landlords
- Lease Agreement for landlords
- Ending a Lease Agreement
- Move In Checklist for landlords and tenants
- Evictions, as sad possibility
- Security Deposit - Don't Gamble with it
Marketing Interests for Landlords
- 32 Questions for your new property manager. Part 1
- 32 Questions for your new property manager – Part 2
- Tenant Screening, that leads to quality tenants
- 10 Reasons to Hire a Property Manager
- Top 10 Features of a Profitable Rental Property
- Your different investment property options
- Property Management Companies and their Rental Services
- Is it time to hire a Property Manager?
- 5 Reasons why you need a Property Management Company
- Selecting a Quality Property Management Firm
- What are Property Management Services?
- Property Managers
- Selecting a Property Management Company
- Is a professional real estate photographer worth it?
- Furnished or Unfurnished, the pros and cons
- Which Home Remodeling adds value?
- 10 Home Improvements that will pay off.