Rental property management is an often complicated process that involves many moving parts. As such, it is usually hard to get it just right.
What Is a Rental Property Management Company?
A rental property management company manages rental units or homes in place of a landlord. These companies assume the tasks that a landlord would normally do, including rent collection and maintenance.
It is common for landlords to hire a vacation rental property management company. There are a number of possible reasons for this, including but not limited to:
- The landlord does not have enough time to manage their own rental property;
- They own multiple rental units or homes;
- They live far from the rental property; and/or
- The landlord simply has no interest in rental management.
The Roles Rental Property Management Companies Play
Running a rental property management company is tough work. There are so many tasks involved that it can get too overwhelming. When this happens, certain aspects of the process may suffer from poor quality. If you have a rental management company, you should know how to do your job properly.
1. Set and Collect Rent
Setting rent is a tricky task because it has to be high enough to turn a profit yet low enough to attract tenants. A rental property management company should gather relevant market data to determine the optimal rent to charge tenants. Ideally, a management company will conduct a survey of the area’s rent yearly. This way, the unit can stay competitive.
In addition to setting rent, your management company will also collect rent. Many landlords have a hard time with this particular aspect of rental management because not all tenants pay on time. A company, though, should devote time to collection efforts and enforce late fees to encourage payment. In doing so, you can ensure you have adequate cash flow to pay for all the maintenance expenses.
2. Screen Tenants
Landlords come across bad tenants all the time. Usually, it comes as the result of a lack of screening.
A rental management company should have screening procedures in place to ensure the tenant is a good fit for the unit. This means conducting credit checks, confirming application details, and calling previous landlords as references.
In addition to this, your rental property management company should also be in charge of what happens before the tenant screening. This includes advertising the property through various channels, answering questions, and scheduling appointments.
3. Prepare Lease Agreements
This is another common pain point for landlords — and one that a rental property management company can help with. A company should know how to deal with legal matters and have sufficient knowledge of all relevant laws.
Your company should also handle the preparation and signing of the lease agreement. Most companies will have a standard lease agreement with all the boilerplate text. However, you should also make sure that the agreement includes any legal terms mandated by the Landlord-Tenant Law in the state where the property is located.
4. Conduct Move-In and Move-Out Inspections
A rental property manager should accompany the tenant during move-in and move-out periods as well. During move-in, an inspection of the property should take place. The inspection must be documented and signed by the tenant as proof of the condition of the property at move-in. You should inform the tenant of the rules and any obligations on their part. This is also when you would collect the first month’s rent and the security deposit.
Upon move-out, another inspection should take place. This is so you can verify the condition of the rental property and document any damages that were not there before.
5. Address Complaints and Requests
It is normal for tenants to have complaints or submit maintenance requests from time to time. Rental management companies should answer these concerns in a timely manner.
For any requests that require action, you must create a strategy to address the issue and act swiftly. If you manage multiple properties, you will need to prioritize requests according to urgency, often with the help of rental property management software. You will also need to coordinate with either a third-party vendor or an in-house team to fix the problem. Not only will this keep the property in good condition, but it will also keep tenants happy.
6. Oversee Maintenance
Maintenance takes up a large chunk of your property management tasks. This involves performing various maintenance work to ensure the physical structure of the property remains in good shape. It also has a direct impact on the health and safety of tenants, making it even more important.
What does maintenance usually involve?
- Cleaning all common areas
- Maintaining landscaping
- Garbage collection
- Maintaining the plumbing and electrical system
- Fixing any damages such as leaky roofs, cracked tiles, and the like
7. Facilitate Evictions
When the situation arises, a property rental management company should know how to handle evictions. This means sending the appropriate notices within the legally mandated timeframe, preparing all necessary documents, and filing for the eviction in court. You will also need to gather evidence to support the eviction.
8. Manage Finances
A rental property management company deals with money all the time. You are essentially managing the finances of your clients (rental property owners).
As such, you must know how much money is coming in and going out. It also helps to know how to prepare financial reports.
Typically, property owners will set a budget for you to follow. You must then work within this budget to pay for maintenance expenses, insurance, utilities, and property taxes. In the event of an emergency, though, you may be able to work beyond the budget. Examples of emergency cases are when the safety of tenants or the physical structure of the property is compromised.
How to Keep Tenants Happy
The best property management companies don’t just do the bare minimum — they also know how to keep tenants satisfied. When you have quality tenants, there is an obvious desire to keep them around. If you want to improve tenant retention, consider the following tips:
- Make your expectations clear from the beginning of tenancy so that everyone can get on the same page.
- Keep common areas clean.
- Talk to the landlord about providing amenities that are popular with tenants such as free wi-fi, an outdoor space, etc.
- Be professional.
- Treat everyone fairly.
- Respond to complaints and requests as soon as possible and with genuine concern. Then, resolve the problem in a timely manner.
- Respect the privacy of your tenants.
- Enforce rules but not in an unreasonably strict fashion.
- Talk to tenants ahead of time about renewing their lease.
- Show tenants some appreciation with a simple gift. Don’t go overboard with this, though!
Setting Yourself Apart
Rental property management is a popular service that many landlords seek. If you want to make your company stand out, though, it is important to do your job right. That means keeping both landlords and tenants satisfied with high-quality work.
Florida Property Management is your one-stop-shop for rental management companies. Browse through our comprehensive online directory today.
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