Savvy property investors are often on the hunt for smart ways to increase the value of their properties without breaking the bank. They are aware that finding the right property in the right location with the right potential are just pieces of the puzzle to achieving their investment goals. Another important piece of the puzzle is ensuring that their property retains high quality tenants, tenants that will pay the rent on time and look after the property. And they also wonder whether it’s worth hiring a property manager or not.
Generally speaking, you increase the value of something when you fix it up. In private equity real estate, this is called value-add investing. Creating value to your property starts with a blend of these three factors – 1) occupancy 2) rental rates and 3) operating expenses. If your property manager can identify a property that has the potential to increase occupancy or rental rates and decrease operating expenses, then he or she has the potential to boost your Net Operating Income (NOI) and thus ‘add value’ to your rental property.
If you’re looking into hiring a property manager from one of the many rental management companies, here are…
5 Ways a Property Manager can Add Value to your rental property
1. Find the best tenants
Property managers are skilled at screening and finding the best tenants with excellent credit and rental history. They provide comprehensive tenant screening. They will spend time doing thorough reference and rental history checks, and look at finances and work histories. Property managers understand that finding a great tenant may be just as important as finding the perfect location for your property because good tenants can treat your property well and are often more likely to sign up for a longer-term lease, therefore reducing emergency repair cost and the potential of no rental income.
2. Set the right market rent
Property managers are skilled at assessing properties in order to determine a market competitive rent. They are also aware of what kind of properties appeal to higher quality tenants and what they are prepared to pay more for. They can conduct an annual rental appraisal, which is an important step to a long term rental management success. A good property manager is aware of the trends in the market. Whether it’s suggesting the kind of shutters or increasing the rent, they’ll be able to guide you towards your long-term property investment goal.
3. Address day-to-day demands & maintenance issues.
Property managers can manage tenant concerns and address day-to-day demands and maintenance issues on your behalf in a timely manner. They have a team of maintenance staff and preferred vendors who can be mobilized quickly and do any emergency repairs in a professional manner. They make sure tenants are happy and vacancies are limited by handling routine inspections and maintenance requests.
4. Put your property financial records in order.
Property managers can manage your property budgets and business records responsibly. They have their own property management system that can provide a comprehensive and fully itemized rental statement for each financial year. They can also provide accurate tax documentation, all incoming and outgoing monies, as well as organize depreciation schedules. They help ensure that you have accurate financial records for your accountant so you can maximize the tax effectiveness of your property.
5. Comply with tenant rights and landlord-tenant laws.
Property managers have the legal obligation to comply with the regulations set out in the Texas Landlord-Tenant Law. While their duties and responsibilities vary based on the type of property managed, they are aware with the changes, local state and regional legislations, because not doing so can have serious implications for the property. Property owners need to understand their rights and legal obligations and property managers can help keep the property owner informed.
A good property manager will not only put your mind at ease, but also add value to your investment. That value is maintained while the property is being lived in. While many property management companies take on many administrative responsibilities, you’ll want to make sure your property manager has a solid understanding of your property. This includes your property’s physical condition, competitive position in the local market, cash flow and rental prospects, as well as the risks and rewards of possible improvements on your property.
Of course, you can manage your rental property yourself. But by being aware of the 5 key ways property managers can help add value to your property investment makes a whole lot of difference in maintaining and increasing the value of your properties.
See the infographics of the 5 way to improve rental investment with a Property management company.
Working with Apogee Properties
Apogee Properties is Houston’s leading real estate management company. We work and live in Houston and our property managers are local. We’ve been in business for more than a decade providing comprehensive property management services in the Houston region ranging from a studio condo to a multi-family million dollar estate.
Apogee looks forward to hearing from you and sharing what we can offer to your Houston property. Contact us today to learn more!
