So, you are new to the property rental market and want to work out if you should hire a professional real estate agent to manage your property...
Your friends in the business have told you this is a great idea - but is it really?
Engaging a real estate agent to manage your rental can be a great way to go if you are short on time, can't be bothered dealing with tenants, and have money to spare.
However, if none of the above sounds like you, do not think you need to hire a professional property manager to be successful!
There are plenty of reasons why you don't need to hire a real estate agent to manage your property and instead, can manage your property like a LandlordBoss.
This is the most obvious factor - hiring a professional real estate agent to manage your property is going to cost you money. How much a company will charge will vary but like most things in life, you will get what you pay for.
In addition to the monthly fee you will be required to pay, you will also be charged for any extra work such as finding new tenants.
If you entered the rental property market to make some serious cash money, hiring a property manager may not be your best option.
Although managing your own rental properties may incur some costs when you first start out, doing it yourself may save you a pretty penny or two in the long run.
Any landlord will tell you that managing a rental property takes time. You need to be responsive to your tenants' needs and be available within reason. Finding new tenants can be particularly time-consuming, and this is a process that you don't want to rush.
For this reason, if you are short on time it may make sense to hire a professional to fill and manage your rental, but of course, this comes at a cost.
If time is on your side, it may be far more beneficial to manage your own rental property, instead of paying someone to do this for you.
LandlordBoss has tonnes of tips and tricks you can use to make your property management processes far more efficient. Take a look at our articles on 7 Habits for Landlording Success and 8 Costly Mistakes New Landlords Make and How to Avoid Them.
Although your rental property may be in the best location for return on investment, it may not be in a convenient location for you to get to on a regular basis.
If your rental property is over an hour's drive away, it may be sensible to hire a local property management company.
Simply put, the cost and inconvenience of traveling to your rental property every time your tenant needs something might outweigh the cost of hiring someone to manage your property.
However, if you live next door to your rental or in close proximity, it may make more sense to manage the property yourself. If anything needs fixing, you know the area and can call up the local tradesperson, in no time at all. This also helps if you are responsible for maintaining the grounds of the property or if you have to run frequent rental viewings.
If you plan to grow your property rental portfolio, never underestimate the value of having your own property management experience. The more properties you acquire, the more skill you'll need to manage your tenants.
If you plan to hire professionals, this may become more expensive (though relative to your rental income) as your property portfolio grows. In the long term, it could be more cost-efficient to do the hard yards yourself.
If you already are an experienced landlord, it may be a waste of money to pay someone to do something you can already do yourself. You can fill vacant properties, manage rent payments and deal with tenants with your eyes closed and don't need a swanky agent in an overpriced suit to tell you how to do this.
If you are a newbie landlord who can't afford to hire a property manager but also doesn't know where to start when it comes to dealing with tenants, embrace this learning opportunity. There are plenty of resources online, including blogs, podcasts, and videos that can help you learn the tricks of the trade. You may even know a local landlord who would make a great mentor (for free).
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.