WHAT DO PROPERTY MANAGERS, OR REAL ESTATE MANAGERS, DO?
Find answers to commonly asked questions and learn more about what property managers can offer you. Choose an area of management, or a question category using the Q&A box on the right.
Can a property manager help me avoid bad tenants?Typically bad tenants will target owner-managed rentals because they can't pass muster with property managers. They know that when a property is for rent by owner the rent will be less and there will be less scrutiny of their financial situation. Because bad tenants can't be evicted without notice and an eviction can take months and cost you money, property managers will track references and do their utmost to avoid potential bad tenants and associated eviction problems.
Can a property manager help me find and keep good tenants?Often, good tenants will rent only through a reputable property manager because everything from initially viewing the property, to negotiating and signing the lease agreement, to dealing with maintenance and repairs, to making rental payments is more efficient and streamlined if a professional company located in the area is coordinating providing the service.
Can a property manager help me with upkeep and maintenance of my investment property?Yes. Property managers negotiate contracts for janitorial, security, groundskeeping, trash removal, and other services. When contracts are awarded competitively, managers solicit bids from several contractors and recommend to the owners which bid to accept. They monitor the performance of contractors and investigate and resolve complaints from residents and tenants when services are not properly provided. Managers also purchase supplies and equipment for the property and make arrangements with specialists for repairs that cannot be handled by regular property maintenance staff.
Can a property manager or real estate manager help me with administrative and financial details?Yes. Generally, property managers and real estate managers handle the financial operations of the property, ensuring that rent is collected and that mortgages, taxes, insurance premiums, payroll, and maintenance bills are paid on time. In community associations, although homeowners pay no rent and pay their own real estate taxes and mortgages, community association managers must collect association dues. Some property managers, called asset property managers, supervise the preparation of financial statements and periodically report to the owners on the status of the property, occupancy rates, dates of lease expirations, and other matters.
I live far from my rental property. Does it make sense for me to hire a property management company to manage my property?A local property manager can keep an eye on your rental property to make sure that the tenants are taking good care of it. Local property managers tend to find problems sooner and correct them more efficiently. In addition, local property managers often have contractors they work with and trust for various repair jobs, which can save rental property owners money and time.
What are property management supplies?Property management requires a broad range of supplies to ensure a smooth, streamlined management process and property. Property management supplies can refer to everything from flags, banners and marketing products to management tools, software, grounds control and safety items. Categories can be misleading, as every major supplier of property management products has their own way of organizing their stock. However, some of the common product groups might include these: management tools; marketing tools for curb appeal; parking, grounds control and security products; maintenance forms and supplies; resident retention items; and outdoor and pool accessories.
‘Management tools’ is the broadest category and encompasses both large and small items. Larger products might include property amenities like key and rent collection boxes, fire safes and status boards. Smaller management tools might include office supplies like stationery and notepads, property checks, software, purchase orders, rental forms, and personalized shirts or property management items.
Marketing tools for curb appeal often refer to the bright and attention grabbing signs, balloons, and displays often seen at the entrance to office and apartment complexes or in front of homes for sale. Signs, flags, door-hangers and banners are also generally used for advertising and marking areas inside and outside the property; these might include rental specials, notices to tenants, newly remodeled unit signs, traffic signs, building number labels, parking directions and the like.
Parking products can include anything from signage, to parking permits and violation slips. Grounds control products include items like trash and recycling receptacles, pet waste products, and outdoor lighting. Security products range from simulated or genuine surveillance cameras, smoke and fire alarms, to door bracers and counterfeit detecting pens.
Maintenance forms and supplies cover all paperwork necessary to keep a property operating smoothly, including maintenance requests and books, door hangers, notices, work orders, and receipts.
Resident retention items refer to small, often personalized gifts like key chains, gift baskets, certificates and other little treats for renters or potential tenants.
Finally, outdoor and pool accessories might include barbecue grills, bike racks, benches, smoking stations, lounge furniture, umbrellas, and security or safety fencing.
Property management supplies can be found easily online or in most general supply stores. This is just a truncated list of possible products, and gives an overview of the overwhelming selection of products available today.
What types of real estate do property management companies oversee?Property managers manage all types of properties, including homes, apartments, mobile home parks, stores, offices, industrial properties, and storage facilities.
Why should I hire a professional property management company, or real estate management company, to manage my rental property?If you lack the time or expertise needed for day-to-day management of your commercial or residential real estate investments, an expert property manager can help you.
A property management company can help you:
- Market your rental property to minimize vacancies and maximize income (link: Property managers make their livings because they know the rental market, what comparable properties are renting for, and what potential renters are willing to pay for a rental property. They have the marketing know-how to reach potential renters and they have the experience and resources to weed out potential bad renters);
- Fill vacancies with the best possible tenants;
- Maintain and keep your rental property in good condition (link: Property managers handle and coordinate routine repairs as well as emergency repairs. They have the experience to avoid unnecessary repairs to save you money);
- Track income and expenses to determine profitability;
- Negotiate rental agreements;
- Collect rent and track tenant deposits;
- Comply with federal, state and local laws; and
- Respond to tenant requests and deal with problem tenants
Will a property manager show my property?Yes. While it may be inconvenient for you to take time to show your property, and to deal with potential renters who may not show up for their appointments, it is a property manager's job to respond quickly to requests from potential renters to view a property and property managers can also pre-screen potential tenants.
What are property management services?The services provided by a property manager or property management company are broad and diverse. Many companies offer both "full service" options and partial or "a la carte" property management service depending on what a property or owner requires.
Full service property management generally includes all or most of the following responsibilities: acting as the first point of contact for tenants, building workers and maintenance contracts as well as maintaining professional relationships with an accountant, insurance agent and attorney if necessary; advertising, marketing, showing available space and leasing the property; interior and exterior maintenance-- whether it be the actual upkeep or coordinating contracts for needed work and services; collecting rent and fees from tenants; coordinating contracts, issuing purchase orders, paying invoices, purchasing supplies, and general accounting and banking needs; helping create, maintain and follow a budget for both short term and long term goals (ie. capital improvements); and administrative tasks like reporting and record retention which might include income statements, annual reports, rent roll, occupancy reports, historical records and file backups of online systems.
Some professionals can be hired as onsite managers to provide 24 hour availability to tenants for emergencies, more hands-on management and flexible scheduling. Offsite managers can be engaged to oversee multiple properties if the owner has a real estate portfolio.
Essentially, property management services provide all of the needed functions to run a property or real estate portfolio without involving the owner. This allows owners to completely hand over the responsibilities of owning a rental property, while still maintaining the financial benefits of the investment.
What is apartment property management?Apartment property management is a profession designated to financially maintain and develop an apartment building or complex as an investment for the owner. Aside from the daily tasks of keeping the property maintained and running, the apartment property manager's main concern is to ensure the income-producing property is performing at its optimum level and achieving or exceeding its expected revenue for the owner. Indeed, as part of a general occupation (property, real estate and community association managers) expected to grow 15% by 2016,1 apartment property management is a thriving career with a need for more managers every day.
The primary responsibilities of an apartment property manager are varied and diverse. Responsible for handling all of the financial operations, managers deal with tasks like collecting rent, paying the mortgage, paying taxes, maintaining insurance premiums and making sure all maintenance is paid for on behalf of the owner. Managers also enforce all terms of the lease agreements like parking, pet or smoking restrictions, rent collection, and procedures for termination of the lease. These management professionals also engage contracts for all janitorial, security, grounds keeping, trash and recycling removal services and make sure that all are available and running smoothly for the building; most managers also purchase necessary office and maintenance supplies. Moreover, the manager is also in charge of advertising and showing vacant units or hiring a leasing agent to oversee such tasks. Many apartment managers live onsite so they are available to respond to any emergencies and concerns of the residents and coordinate necessary repairs.
Aside from taking care of the day to day duties of making an apartment building operate smoothly, apartment property managers also prepare and submit periodic reports on the financial status, occupancy rates, leasing status and other relevant topics to the owner or senior offsite property manager. Not only that, these professionals must also always be aware of all local, state and federal regulations and building codes, up to date on relevant legislation, and conscious that none of their rental or advertising practices are discriminatory in any way.
The median salary for property, real estate and community association managers in 2006 was $43,070, with the middle 50% earning anywhere from $28,700 to $64,200.2 Expected to have a "faster than average growth" by 20163, the industry for apartment property managers continues to expand rapidly to keep up with development and demand across the nation.
|1||Bureau of Labor Statistics website. Accessed April 2nd, 2009.: http://www.bls.gov/oco/ocos022.htm.|
|2||Bureau of Labor Statistics website. Accessed April 2nd, 2009.: http://www.bls.gov/oco/ocos022.htm.|
|3||Bureau of Labor Statistics website. Accessed April 2nd, 2009.: http://www.bls.gov/oco/ocos022.htm.|
What is property management software?
Property management software provides a way to consolidate, track, sort, and record all of the information needed to successfully manage a property or portfolio. Ranging in price from free to over $1,000, property management software can be chosen depending on budget, the number of units managed, the complexity of the portfolio and so on. These property management tools are specifically designed to help manage single or multiple properties by consolidating all the informational aspects of management into a single program.
Property management software provides a wide array of services ranging from simple organizational tools and printable forms, to tracking options and a selection of reports. Indeed, these software systems contain some or all of the following features: accounting options like tracking rent, paying bills, and consolidating property account information for taxes and insurance; organizing personal or historical information by tenant, unit, building, or property; organizing income and expenses by tenant, unit, building or portfolio; tracking work orders and contract histories; creating forms for rental and lease agreements, notices and letters; and generating a wide range of reports from background checks and tenant information to accounting, cash flow, expenses, work orders, rent rolls, and financial overviews. Most of these programs also boast tracking and reminder systems, sorting options, and extensive ways to group information by the preference of the user.
Property management software programs are designed to make the management process easier and smoother, and allow property managers more time for other commitments, or the ability to take on more properties. Programs like these have all of the necessary information in one place to run a successful property or portfolio, and moreover, the tools and features to run it in an organized and efficient manner.
Are there software programs specifically for commercial property management?Commercial property management software is a valuable tool for commercial property managers seeking to consolidate all of the personal, financial, and operational data regarding the property or portfolio they are managing. Available for a wide range of property management types, commercial property management software provides the specific features commercial property managers need most.
While there are several commercial property management software programs available, in general, the applications will contain some of all of the following features: accounting functions like tracking rent and late fees, bill pay, and categorizing property account information for taxes and insurance; organizational tools for sorting the personal or historical information of the tenants according to the preferences of the user; tools to file income and expenses by tenant, suite, building or portfolio; tracking systems for work orders and contract histories; form creation templates for rental and lease agreements, notices and letters; and the generation all types of reports like accounting, cash flow, expenses, work orders, leases, vacancies, rent rolls, invoices and financial overviews. Most of these programs also have tracking and reminder systems, sorting options, and myriad ways to group information by the preference of the user. Also, some systems provide the ability to integrate with current accounting systems, and others offer additional features like acquisition, development and disposition tools, or forecasting programs.
Commercial property management software enables managers to gather and organize all of the information pertaining to their properties quickly and efficiently. Thousands of property managers are taking advantage of these streamlined systems both nationally and internationally. Indeed, in an age when every industry is striving keeping pace with technology, property management software is becoming a requirement of successful management practices.
What is a property management system?A property management system (PMS) can sometimes refer to an online program or software designed for residential or commercial property management. However, more often it refers to software used in the hospitality industry to manage the day to day requirements of running a hotel or resort. Some property management software can integrate with hospitality applications already running such as revenue and yield management programs, front/back office systems and point of sale systems, while other property management systems offer complete solutions by including all of these functions in their package.
Property management systems are utilized by hotels of all sizes, resorts, casinos, and even conference centers and multi-property organizations. They can be based online with an application service provider (ASP), or hosted internally on the current computer systems of the business. Property management systems can be used to manage single or multiple properties, and basic functions might include features like these: guest check-in and check-out, guest profiles, tracking services, report generation, auditing, front and back office services, and security systems. Additional features are generally highly customized and can include amenities like restaurant or spa scheduling, housekeeping schedules, and gift card management.
Integrated to help lower costs, increase revenues, and provide better services to the customer, property management systems are a popular resource for hospitality companies. Often chosen by the number of units managed, number of locations, and number of employees forecasted to use it,1 property management systems can cost anywhere from a few hundred to several thousand dollars for internally hosted systems, or between a $50-$300 monthly charge for systems hosted online.2
The hospitality industry benefits from a wide array of property management systems today; with the range of features and integrations to choose from, there is a program that can be tailored to the specific needs of every company.
|1||"What To Look For In Property Management Software." Accessed April 17th, 2009.: http://www.buyerzone.com/software/property_management/buyers_guide7.html|
|2||"What To Look For In Property Management Software." Accessed April 17th, 2009.: http://www.buyerzone.com/software/property_management/buyers_guide7.html|
How can rental property management help me?The glut of homes, apartments and condominiums—nearly 14 million empty and 9 million currently for sale1-- on the market from the recent housing boom and subsequent economic downturn have left both property owners and those searching in the housing market turning more towards renting rather than buying. This, coupled with vacancies in the commercial market make owning any rental real estate a valuable asset.
If you own a home or rental unit, rental property management might be a smart way to manage today’s tricky market. Rental property management allows a property owner the benefits of retaining the equity of the property while avoiding the time-consuming and often laborious duties involved with keeping an investment property performing well.
Hiring a manager for the rental property means being guaranteed the daily tasks of maintaining the property are in the hands of a professional. For example, a professional property manager will handle communicating and interacting with current and prospective tenants and contractors hired for maintenance. In addition, a rental property manager will also handle the financial responsibilities of the property including collecting rent and fees, accounting, budgeting and invoices; he or she will also keep records of all administrative and financial information, and keep taxes, mortgages, and insurance up to date. Moreover, marketing, showing vacant spaces, and leasing all fall under a manager’s responsibilities as well as maintaining the building’s operations.
In short, rental property management is an easy solution for property owners who have not the time or experience to successfully run an investment property, be it a single family home or a multi-building office complex.
|1||USA Today website. Accessed June 18th, 2009.: http://www.usatoday.com/money/economy/housing/2009-04-09-vacanthomes_N.htm|
What is commercial property management?A commercial property manager handles non-residential properties like offices, retail spaces, storage facilities, shopping centers and industrial buildings. Like residential property management, commercial management encompasses the tasks and responsibilities of operating an income-producing property.
Commercial property management involves being able to prioritize and execute a wide array of tasks. For example, advertising, marketing, and leasing processes are all part of the commercial manager’s job; because commercial leases are generally longer than other properties, with built-in renewals (ie. a five year lease with options to renew) and rent escalations1, both the marketing and lease negotiation processes are longer and more involved than in other types of property management. However, commercial property managers have less hands-on tasks once the space is leased than other managers, as many commercial tenants of spaces -- like offices, retail units and industrial suites-- often take care of their own general maintenance, and in some cases, design and customize the interior of the space to suit their businesses.2
Property managers of commercial spaces keep meticulous administrative and financial records, and keep all applicable maintenance, taxes, mortgages and insurance updated. They ensure rent is collected, and respond to tenant needs and issues. Managers also provide regular reports (ie. occupancy, rent roll, and budget) to the property owner, providing regular updates on how the investment is faring.
A commercial property manager is an asset to any property owner who has not the time or experience to market or manage their commercial real estate property themselves. Professional property managers are becoming more common for investors who are either too busy or simply not interested in the challenges of managing a property; indeed, according to the Bureau of Labor Statistics, the profession is expected to see “faster than average” growth between 2006 and 20163.
|1||RealData website. Accessed June 10, 2009.: http://www.realdata.com/ls/residential-versus-commercial.shtml|
|2||RealData website. Accessed June 10, 2009.: http://www.realdata.com/ls/residential-versus-commercial.shtml|
|3||Bureau of Labor Statistics website. Accessed June 16th, 2009.: http://www.bls.gov/oco/ocos022.htm.|
What is residential property management?A residential property manager runs an income-producing residential property on behalf of the owner. Properties commonly designated as residential include single and multifamily homes, condominiums, townhomes, and apartments.
A residential property manager handles all steps of the marketing and leasing process of a vacancy, as well as the general day to day duties of keeping the property well maintained. From analyzing the area, setting rental rates and showing the property to potential tenants, to qualifying their applications and negotiating the lease period and terms, a residential property manager will take care of all of the necessary steps to tenanting the building. Unlike commercial properties, which tend to have longer leases, turnover is high in residential properties, with most leases lasting generally between 6-12 months.1 Therefore, a large part of residential property management is marketing, showing and leasing spaces.
In addition, a professional property manager will coordinate all maintenance needs for the building, track all administrative and financial information, and keep the building’s insurance, payroll, taxes, mortgages and budget updated. Residential property managers respond to tenant requests, issues and problems, and act as the first point of contact for the building. Indeed, communication is a key element for residential managers and good managers keep in regular contact with the property’s owner; whether by forwarding updated reports, or in a less formal manner, a property manager is sure to keep the owner updated on the status of his or her investment.
Residential property management is particularly useful when a property owner lives far away from his or her investment. Indeed, whether it is a matter of convenience, or a shrewd business investment, property managers are an excellent way to ensure an income-producing property is earning its maximum revenue at the lowest cost.
|1||Rockwell Publishing. Real Estate Principles. Accessed June 10th, 2009.: http://books.google.com/books?id=sXq6G-j_PP8C&pg=PA443&lpg=PA443&dq=how+industrial+property+management+differs+from+residential&source=bl&ots=dz8dNAoVhH&sig=r2vNdI9TAv2dn99AmkeCb0st62A&hl=en&ei=YfMvStq5OKiGtgOnloCxCg&sa=X&oi=book_result&ct=result&resnum=10|
What is income property managementAn income property is a type of real estate that generates revenue, generally through rental payments, for the owner. These properties can be residential or commercial and can be almost any size-- as small as a single family home or apartment unit, to larger than a multi-building office complex.
Regardless of the type or size of the investment, income property management is a lot of work. It requires a thorough knowledge of the surrounding property market to set a competitive rental price, the daily interactions with tenants, contract workers and prospective renters, and the constant upkeep of the both the physical property and the administrative and financial information to go with it. Many income property owners turn to professional management companies to oversee their properties and handle the day to day responsibilities the investment requires. In doing so, owners are able to retain the financial benefits of the investment property without having to give up any of their time, and have the advantage of a professional managing their investment.
Income property management is a common occurrence with investment real estate. Indeed, there were approximately 329,000 property managers operating in 2006, and the industry is expected to grow by 50,000 managers by 2016.1
A valuable alternative to other investment avenues like the stock market, millions of properties across the country are owned specifically for the goal of generating income. Indeed, with so much interest and investment in income properties, professional management continues to be a thriving industry.
|1||Bureau of Labor Statistics website. Accessed June 22nd, 2009.: http://www.bls.gov/oco/ocos022.htm|
What is a homeowner association? Can property managers help with homeowner association management?A homeowners association (HOA) is a legal entity created to maintain the common interests of a community. According to the Community Association Institute, “about 6,000-8,000 new community associations are formed every year.”1 Whether it be a neighborhood of single family homes, a building of condominiums or a community of townhomes, HOAs ensure the upkeep of the quality and value of the properties and quality of life within the community.
Homeowner associations govern neighborhoods, planned communities, condominiums and the like, and ensure that the rules, regulations and services the association has created are all running smoothly for the residents. Homeowner association management oversees tasks like these: managing common areas of the community like parks, clubhouses, pools, landscaping and roads; maintaining and enhancing property values; and organizing activities for area residents to foster a sense of community. The associations also often set rules to be followed in order to protect the interests of the residents as a whole. These rules can be as general as keeping yards tidy, to as stringent as dictating the acceptable colors to paint houses, noise control, use of common areas, and other restrictions. In order to provide these services and enforce these rules, homeowner associations charges monthly dues to cover costs. Fees can range from $20 per month to hundreds per month depending on the property in question and the amenities provided.2
Homeowner association management is generally taken on by a board of elected community members. For smaller associations, the elected boards are volunteers, and handle all issues of maintenance, providing services and enforcing rules themselves. However, for larger communities, it is necessary to hire a professional manager or management company to oversee the duties and tasks the board has set forth. With experience in the requisite administrative, financial and legal tasks, a hired association manager is trained to handle all aspects of the community’s upkeep on a daily basis.
Essentially, a homeowner association manager takes over the responsibilities of the board and oversees duties including: the maintenance of common areas like landscaping and improvements; budgeting and assisting with the development of governing documents; enforcing association rules and regulations within the community; carrying out the development goals of the board; acting as the liaison for work orders and maintenance; and being the point of contact for the city, contractors and developers. Sometimes the manager can also be brought on as a leader to help a new or inexperienced board establish goals and projects for the community. In having a permanent professional manager, it leaves the board free to make decisions while an experienced professional oversees the day to day tasks and projects.
Association management whether by volunteers or experienced industry professionals is fast becoming integral to the success of new communities. In providing for the best interests of the community, it allows homeowners another resource for maintaining the value of their investments and improving their quality of life.
|1||About.com:Phoenix. Accessed January 21st, 2009.: http://phoenix.about.com/cs/real/a/HOA01.htm|
|2||About.com:Phoenix. Accessed January 21st, 2009.: http://phoenix.about.com/cs/real/a/HOA01.htm|
What is rental property management software?
Rental property management software enables property managers to streamline their office work and paper files by recording, organizing, consolidating, and tracking information concerning the rental property. Rental managers can keep track of tenant and building information easily, prepare taxes and owner reports, and free up time that can be spent working on other management tasks.
Property management software provides several services ranging from simple organizational tools and printable forms, to customizable tracking screens and multiple reporting options. Indeed, most software systems contain some or all of the following features: accounting tools for tracking rent, paying bills, and consolidating property account information for taxes and insurance; forms for organizing tenant, financial, and historical building information by tenant, unit, building, or portfolio; tracking tools for current work orders and contract histories; programs and templates for creating rental and lease agreements, notices and letters; and report generation tools for presenting information from background checks and tenant information to accounting, cash flow, expenses, work orders, rent rolls, and financial overviews. Additional tools might include tracking and reminder systems, sorting options, and extensive customizable ways to group information by the preference of the user.
Rental property management software is fast becoming a requisite tool for all property managers. Not only does it streamline most, if not all administrative systems, but enables a manager to better oversee a property and maximize its success.