Finding the right property management company is critical to making a solid profit flow from one month to the next. If you take the time to hunt down great apartment building deals are are ready to purchase your first commercial asset, you’ll need a property management service. It’s a very common practice and there are some very good reasons why it’s done.
Why Multifamily Property Investors Need a Property Management Service
So, why do you need a property management company in the first place? Well, let’s start with the fact that managing an apartment building (especially one with multiple units) is basically a full-time job. Yes, it takes 40 or more hours per week, particularly when it comes to buildings with dozens or scores of individual units.
Management companies deal directly with your potential tenants and the tenant ultimately selected to occupy the house. Rental property management companies can save you time and worry by listing your house, collecting rent, handling maintenance and repair issues, responding to complaints and even evicting problem tenants. While the management company is responsible for managing and scheduling repairs, usually you’re still on the hook for the cost, so make sure you factor that into your budget accordingly. —Quicken Loans
Even if you purchase a multifamily property with just eight to ten units, that too, will take a lot more time than you suppose. Another reason to hire a property management service is you need a team that’s familiar with managing properties. In other words, you don’t know what you don’t know. And, it’s what you don’t know that can easily be a huge danger. What’s more a property management service knows how to collect rents, deal with routine maintenance, and emergency issues. Those are good enough reasons to hire a property management company.
How to Find the Right Property Management Company
Now, how do you know what is the right way to go? How do you find the right property management company? Well, you should ask these basic questions to put yourself on the right path:
- Ask how many units and/or properties they currently manage. You definitely want a team that can handle your particular load. For instance, you do not want to hand over your multi-unit commercial property in the hands of someone who is only experienced with a few single family homes.
- Ask how they fill vacancies. Make no mistake about it, there will be unit vacancies and they will happen routinely. That’s enough to send any property investor into big-time panic. Learn how they quickly fill vacant units so you don’t have to worry.
- Ask how they deal with problem tenants. Another reality about owning multifamily housing is that you will occasionally have problematic tenants. And, you’re right not to want to deal with them. A good property management service will handle those situations for you.
- Ask if they are experienced with the eviction process. The day will come when eviction is the only alternative. And, most people would greatly prefer to avoid it altogether. But, you don’t want to hand it over to a team that’s never done it before because that could lead to legal trouble for you.
If you’d like to learn more about commercial real estate investment benefits and more about the process, please contact me.