First, let’s clarify what we mean by a property management team. Your property management team is the group of professionals that you use to help you run your property like a business, streamline your time and get the best, most profitable results.
The reason you’d need such a team is that one person can’t do everything. Especially if you intend to work, travel or otherwise do anything other than just manage your rental properties.
What we don’t mean though, is building a property management business. Rather the team that DIY landlords can build to support their portfolio management.
You’ve invested in your first property. You did your research, you’re confident of positive market growth- you’ve leveraged your finances to get an excellent return, with low risks. If you managed all this without professional advice or help - well done.
The next thing that you are going to want to do is renovations.
If like the rest of us, you aren’t a skilled builder/ interior designer/plumber/ electrician or you simply don’t have the time or desire to do all the work alone, then you will likely want to enlist the help of high-quality professionals to get the best results (this often coincides with the most cost-efficient plan in the long run).
This is where your journey to build a team starts. Finding skilled tradesmen you can rely on, not only for this renovation but for future maintenance calls and future properties will be incredibly useful!
A renovation can be a small job, a few splashes of paint- add some tiles to a bathroom, swap out an oven, update fixtures, replace some flooring. Or it can be big, a complete remodel of the entire house. Whichever way you go you will want to hire the best, to increase your properties worth and maximize rental yield.
The sooner you find good tradesmen who you think you can rely on for future call-outs the better. And your future as a landlord gets a whole lot simpler.
Now you could do this yourself, but finding, vetting, and screening tenants is labor-intensive, and what if you’re not around all the time?
You need someone who you can trust to show tenants around the property when you aren’t there, also you need to draft up an airtight lease and screen tenants properly to avoid any future issues you may have with them.
You can hire a property manager to do this all, however, they can be expensive. A normal property management fee is 8% of the monthly rent plus a commission of the first month's rent when the tenant moves in. If your properties rental yield was $1,000 a month, for example, then they’re going to take nearly $2,000 a year. That’s 17% of your yield.
What you really need is someone who you trust, has a nice smile and friendly persona and is in need of a bit of extra cash.
1) List the property on:
Five or six are probably more than enough but there are plenty more out there for you to list on if you want to.
2) Second, they will go through applications and filter out any bad ones before sending the rest on to you.
3) Thirdly they will arrange viewings with all the tenants that pass your own personal vetting.
4) Finally, you will need to be able to call them in case of an unexpected emergency. They will have a key and be able to solve problems when you yourself are unavailable.
As you get to trust them more - and they understand better what you want from a tenant then you can become less involved in this process. But for your first few properties, you will want to keep a finger or two involved.
You will then screen the whittled down applicants and select them.
Tenant screening is very important! Learn How To Screen Tenants Like a Boss
If you are unavailable to do these next tasks personally then they can also step in:
Throughout the year you should be keeping good records of all income and expenses. And you should be keeping track of your mileage. Using modern property software applications like Landlord Studio will make this incredibly easy.
At the end of the year, you will need to file for your taxes. Getting a professional to check them over could save you a world of grief, as well as save you thousands. Talk to them about depreciation, for example.
What Does Your Team Look Like?
Putting together this team won’t happen overnight and it becomes increasingly valuable the more properties you own and rent out.
Having professionals you know, trust and can rely on to get great results and help when things go wrong with making your life much easier and allow you to live the life you want, without stressing about your property investments.
We hope you found this blog interesting! However, do note that it should not be used as a substitute for competent legal and/or other advice from a licensed professional.
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