People own properties for a whole slew of reasons. Whether it be as a personal home, an inherited property or an investment opportunity, people may find themselves in the situation where they are toying with the idea of renting out their piece of the pie. This brings us to the Pros and Cons of Hiring a Property Management Company….do you rent out the property yourself or hire someone to do it for you? Pros:
PEACE OF MIND – Someone is there to handle any issues or emergencies that might arise at your rental such as minor repairs or a burst water pipe.
FINDING A GOOD TENANT – Management companies have a screening process in place to ensure a qualified candidate will be placed at your property.
COLLECTING RENT – Sometimes tenants fall behind on their rent. Management companies have ways to handle this and can save you the headache of having to track down payments. Worse comes to worse, if you had to move to evict a tenant they would handle this for you as well.
LOCAL – If you are living out of state it is sometimes hard to handle everyday affairs that a rental property requires such as property showings, maintenance appointments, etc. By hiring a local management company they can physically be there to help take care of the day to day items.
COST – If you hire a management company to manage your property, you could end up paying between 8-15% of your rental income in management fees.
INCENTIVE – You of course will have the most incentive to get your property rented as you want to see that rental cash flow coming in. However, for the most part management companies don’t see a dime until your property is rented.
PROPERTY FAMILIARITY – If you handle the management of your own rental you can become very familiar with not only your tenants but also the ins and the outs of how the property operates and there’s something to be said about that. Just keep in mind that between finding the right tenant, collecting rent, keeping the books and handling maintenance requests, being a landlord can be very time consuming and you’ll want to take this into consideration.
We hope that you find this information useful. Any pros or cons we forgot to mention? Let us know!
~Ansley & Ferris