Property management services essentially exist to bridge the gap between landlords and tenants. Their primary goal is to assist in maintaining a harmonious and efficient rental experience for both parties. While landlords do not need to enlist a property management service, it can present a number of worthwhile benefits for both tenants and property owners.
For landlords, these services generally handle the day-to-day responsibilities of property ownership.
This includes but is not limited to:
- marketing vacant rental units
- screening prospective tenants
- collecting rent
- coordinating maintenance and repairs.
This removes much of the stress and the more time-consuming tasks that come with managing a rental property. In other words, they allow landlords to enjoy a passive, sustainable income stream and that all-important peace of mind.
Tenants stand to benefit from a good property management service as well. By acting as intermediaries, these services ensure that any concerns are promptly addressed, that maintenance requests are handled efficiently and that the rental property meets safety and quality standards.
In this way, their presence goes a long way in cultivating and maintaining a sense of security and reliability, making the rental experience more comfortable and enjoyable for tenants.
Property management services are the landlord-tenant relationship's linchpin, promoting a win-win scenario. That said, whether or not their services are necessary is down to each landlord and how hands-on they are willing to be in managing their investment.
How do these services calculate cost?
Cost is easily the most significant barrier to entry when it comes to these services. In general, these services do not come cheap, and landlords will need to account for their service charges when planning the future of their rental investment. The cost of property management is dependent on various factors.
The first consideration is the type of property involved and its size.
Whether you’re planning on renting out a single-family home, apartment or commercial space can significantly affect the cost of the management service. Larger properties or those with more units generally require more management and, therefore, incur higher fees.
Location is always important too. Properties in high-demand urban areas might have higher management fees due to increased operational demands and market dynamics.
The degree of services will impact the price as well. This range can vary widely, from basic rent collection to comprehensive property maintenance. More extensive services naturally come at a higher cost. The property’s condition and maintenance needs can also influence management fees.
The time it takes to ensure compliance with local regulations and licensing requirements is another area that can affect costs, as are prevailing economic conditions and market trends.
Finally, factors like the company’s reputation, tenant turnover, the need for a tailored service and the technologies and tools involved can all potentially affect pricing models.
Is it worth going it solo?
With all the benefits of professional property management in mind, managing tenants alone can present a multitude of challenges. The most obvious of these is the significant time investment it requires. Landlords are essentially on-call 24/7 to address tenant concerns, emergencies and maintenance issues. This can be both mentally and emotionally draining, particularly long term.
Tenant screening and selection is another of the many challenges involved.
Without the expertise of a property management company, landlords must manage the intricacies of background checks, credit evaluations and lease negotiations alone. Selecting the wrong tenant can lead to payment problems, property damage or the headaches that come with eviction.
Maintenance and repairs are another significant hurdle.
Landlords are responsible for maintaining the overall condition of the property. This is both time-consuming and costly. On another note, handling disputes with tenants, whether related to rent, property conditions or lease terms, can escalate into legal battles.
That means staying updated on ever-changing landlord-tenant laws and regulations is essential to avoid legal pitfalls.
Financial management is yet another obstacle. Keeping track of rental income, expenses, and taxes can be overwhelming, particularly for those with multiple properties.
While being a DIY landlord can save money on property management fees, it requires a substantial investment of time, effort and expertise. Many landlords ultimately opt for property management companies to relieve these challenges and ensure smoother, less stressful property ownership.
Can property valuers assist here?
Property valuers can provide crucial assistance to landlords facing the challenges of managing their properties alone. However, the services they offer are distinct from property management companies. This means that, while they cannot entirely replace these services, they are a viable alternative that can fill in many of the gaps that come with solo property management.
First and foremost, hiring a professional valuer in Perth for regular valuations will ultimately work out much cheaper than consistently maintaining property management fees.
Valuers primarily focus on determining the fair market value of a property. Landlords can use this in various ways to provide some of the benefits of a management service and a few more.
The first and arguably most important is rent optimisation. Valuers are trained to conduct comprehensive assessments of the building and local market and economic conditions. This information is harnessed to help landlords establish competitive yet profitable rental rates.
This way, valuers can help landlords ensure their properties are consistently occupied.
They can also advise property owners on necessary property improvements or repairs. More specifically, they can advise you on the kinds of renovations and improvements that can improve overall value and appeal to tenants.
In addition, valuers can help with general risk mitigation, delivering market insights and portfolio management for landlords with multiple assets.
Contact your local valuation firm for more information on their services.