Commercial and residential real estate investors should do a number of things on a regular basis in order to optimize their investments.
From advertising vacancies, to handling inquiries, to handling maintenance and repairs, a property owner has a list of responsibilities they must constantly attend to in order to maintain maximum efficiency of their property. This never-ending list of to-do’s can really bog an investor down and prevent them from growing their real estate portfolio. With that being said, you don’t have to do all of those things. Investors constantly choose to work with property management companies like Forte Realty Property Management. So, should you? Although there is no perfect answer to this question, we’ll go over a few things real estate investors must consider.
How Much Does Property Management Cost?
Property management fees vary by location but typically include a large, one-time fee each time a unit is rented and a monthly fee between 8-12% of the rents collected. The large, one-time fee is often between 50-100% of the first month’s rent. If a property owner finds themselves cash poor, they might not opt to hire a property manager in order to cut expenses. Of course, the counter argument to that is that hiring a property manager would free up an investor to do “higher value” tasks like finding more investments.
Are You Willing to Learn How to Become a Landlord?
The skills to become a landlord are not necessarily intuitive, and laws can be very specific to your property’s location. So, will you invest the time needed in order to learn how to become a great landlord. Will you read books listen to podcasts, talk with local landlords, and ask for help when needed? If so, maybe you don’t need a professional property manager.
On the other hand, if you are simply not interested in learning how to become a good landlord, there’s nothing wrong with that. In that case, you are better paying a professional property manager to oversee your property.
Real Estate Ownership Requires Active Participation
Many real estate investors quickly realize that real estate ownership is not passive. Again, property owners constantly have a list of things to do. It’s our belief that hiring a property manager is necessary in order to make your real estate investments as passive as they can be.
Remember though, even if you do hire a property manager, you should still communicate with your property manager to ensure they are doing their job correctly. While your level of communication with your property manager will vary, it is not prudent to be completely hands off. Nevertheless, your level of involvement will be directly correlated to things like your property manager’s experience, expertise, communication abilities.
If You Decide to Hire a Property Manager
Should you decide to hire a property manager, do your due diligence and find the best manager for you. Start with asking individuals for recommendations. Ask people like your real estate agent, your lender, tradespeople you may know, and other landlords in the area. Additionally, if you are looking for a property manager in the New Orleans area, feel free to contact a New Orleans Property Manager like Forte Realty. We would love to work by your side on your real estate investment journey.