This guide is short so that new property managers can learn the basics of rental property management. It won’t go into all the details of managing residential and commercial properties, though.
Learn About Your Market Before You Buy A Home
Some first-time property managers have had to deal with the following: The business owner has been looking for a good deal on a house or apartment building for days, weeks, or even months. Finally, he or she has found a great house or apartment building for a very low price. They hurry to buy it before someone else does, and they don’t care much about what it looks like.
But once the property is bought, it can’t be rented, so it’s a waste of time and money for the property manager. If the person who wanted to be a residential property manager had done their homework and looked into both the property and the market it was in, they would have found that even though the property was cheap, it wasn’t a good fit for the market it was in.
Before Becoming A Property Manager, Learn The Local Laws
Regulations from the state and even the city can quickly become one of the biggest problems that property managers will ever have to deal with. Even experienced property managers can break a rule or law they didn’t know about before, especially if they move to a new market.
Propertyware, a company that makes software for managing rental properties, says that one of the most important things for new property managers to do is to “Know the laws around rental property management.”
Property managers can learn about property management rules and local laws in a few ways:
- Visit state and local websites that have rules about property management. Talk to an attorney who specializes in property management to get an explanation of specific rules. Get information from local property management or homeowners’ association groups.
- The second option is often the best one since a lawyer who specializes in residential or commercial property management is likely to know a lot about the laws that property managers must follow.
Learn Your Property Management Numbers
As with any business or investment, it’s important for property managers to know their key performance indicators (KPIs) inside and out if they want to be successful in the long run. Some important property management metrics to keep an eye on are:
Especially when managing a building with more than one apartment, it’s important to know how many units are currently occupied and how many are still available. If you can compare this property management metric to the market as a whole, you can get a better idea of how well the business is doing as a whole. Managers of rental properties want to keep this number as close to 100% as they can.
Costs Of Property Maintenance
Maintenance is a cost of property management that can’t be avoided. Keeping track of how much you spend on property maintenance and which problems come up most often is important for figuring out how profitable a property is (and for identifying potential issues).