Managing Rental Property
If you have rental property but would rather not deal with the headache of being your own landlord and dealing with your tenants you need to select a good property management company. Rental property management covers four main categories of properties. These are commercial, residential, industrial and retail properties. There are various criteria to be considered when selecting rental property management firms, like reliability, experience and honesty.
Commercial property management refers to real estate that includes various income producing properties. Office buildings, hotels, shopping centers, restaurants, warehouse, factories and industrial parks are all income generating properties. There are risks attached to real estate investment in commercial properties that include default in payment of rent by tenants, bounced checks, unexpected maintenance expenses, decline in property values due to overbuilding and low demand.
Residential property management refers to properties that are zoned for family homes, single units, multi-family apartments, duplex homes, townhouses, condominiums and cooperative housing units. As the landlord you lease the rental properties to tenants from whom rent is collected monthly.
Industrial property refers to property used for industrial purposes. Real estate that is zoned for the purposes of manufacturing, research, warehouses and factories are all industrial properties.
Retail property refers to property that is used for retail purposes. Retail property is used for businesses that sell goods and services. The businesses include furniture stores, clothing stores, convenience goods stores, drug stores and other types of stores.
Investors in real estate properties seldom have the time to manage the properties. This has given rise to a large market for rental property management companies. When choosing rental property management companies, it is important that the property management company you select has a good working knowledge of real estate market you are involved with.
Rental property management involves the following responsibilities:
• Arrange fire, theft, liability and other relevant types of insurance for the rental properties. Making sure the insurance premiums are not defaulted on
• Advertising vacant properties for rent
• Showing properties to prospective tenants and interviewing interested parties
• Screen prospective tenants through written application forms, credit references and employment references
• Conduct investigations into the background, credit history, bank references and personal references of prospective tenants
• Take care of regular maintenance of the property; arrange for and supervise repairs whenever necessary
• Conduct period inspections of the property for structural damage, electricity, plumbing, cooling and heating problems
• Make sure tenants comply with the terms and conditions laid out in the lease rental agreement
• Establish and maintain a system for rental payment collection and security deposits
• Handle tenant evictions in accordance with the laws of the state
Real estate management companies typically offer their rental property management services for a percentage of the monthly rental income on the rental property. This is a good option for property owners who do not have the time to be their own landlord and personally manage their properties and tenants. It is also an ideal solution for people who do not live in the same city where the rental property is located. Long distance property management can be riddled with many problems. You don't want to come back to your property to find that your tenants have trashed the apartment leaving it looking as though a rhinoceros had gone on a rampage.
Most rental property management firms will have their own team of handymen to support the efficient maintenance of the property. The support team is generally made up of a plumber, electrician, carpenter, electrical appliance repair person and yard maintenance person. Often, apartment buildings have an in-house apartment manager, established in the job by the rental management firm. The apartment manager may sometimes double as a handyman for the property. They may do everything from cleaning the outside of the buildings with power washers to installing ceiling fans.
Before making your final selection of a property management company it would be wise to speak with other real estate investors currently using the company, as well as those who have chosen to use the main competing real estate management companies in the area.