Property management companies act as the intermediary between property owners (real estate investors) and tenants (renters). The property owner pays a fee or a percentage of the rent, and in return, receives property management services that will handle the day to day needs of the property.
Rent Collection
By using an established company, tenants are given more confidence and security when providing personal information and making payments. Property management companies collect the rent and then send the money to the property owner once the applicable fees are deducted. The company will also hold deposits in a secure escrow account.
Tenant Management
The property management company will be the first point of contact for the tenant and will handle any questions, concerns, or maintenance requests they might have. Having a company handle tenant phone calls and emails ensures faster resolutions and frees up the property owner from being on call 24/7.
Maintenance & Upkeep
As many property management companies have existing connections with contractors in the area, maintenance issues and repairs can be addressed more quickly and potentially at a lower cost than if the property owner had to find someone to do it themselves.
Filling Vacancies
Property management companies will market, advertise, and show any vacancies to prospective tenants of the properties they manage. Companies generally will charge additional fees for sourcing new tenants.
Qualifying Tenants
The property management company will conduct background, eviction, and credit checks to assess the viability of potential tenants. It is necessary to weed out applicants that might be unreliable and default on payments.
Tenant Placement
Property management companies will usually offer tenant placement services as well. This is not as inclusive as the services listed above, but the management company will still market the property, qualify potential tenants, and assist with all the legal documentation necessary for the lease. For property owners that want to manage their properties themselves but need help finding the initial tenants, this can be a viable alternative.
