If you are interested in buying an investment property then you should have a good understanding of property management. Many real estate investors look for a good income property without realizing the responsibilities that accompany ownership of an income property. That is to say, many do not realize that ownership of an income property involves property management .
Suppose you have found the perfect investment property , an apartment complex of 20 units that is in your price range and will provide you with an adequate monthly return. You must now consider the time it will take to manage the property and whether it is really worth it to you. Property management is no easy task and depending on the property can take up a substantial amount of your time and resources. Let’s review some of the more prominent responsibilities of the property management team.
Maintenance – All properties will require regular maintenance, which typically falls on the shoulders of the property management team. Regular maintenance usually involves ensuring the common areas of the complex are in a respectable state. Light fixtures and smoke detectors need to be checked and replaced regularly to ensure they are in good working condition. Common areas also must be cleaned by the property management team so as to maintain the attractiveness of the investment property.
Repairs – Depending on the age of your income property, you will find a variety of repairs that must be taken care of by the property management team. Tenants will likely have issues with leaky pipes, broken heaters, and malfunctioning toilets. These issues must be addressed by property management. Undoubtedly your tenants will encounter issues beyond the norm, and part of your property management responsibilities will be to address these issues. Property management also includes taking care of outside repairs. Older apartment complexes will likely need the shingles on the roof replaced. As a property manager and owner you must arrange and pay for this. There might be other repairs that must be made such as broken windows and screens.
Billing/Collections – Part of the property management job description is collecting the rent each month. Typically you will have no problem collecting rent from the majority of your tenants. But be aware that when you come across a problem tenant that is not making payments you will have nobody to turn to but yourself to collect the payment. Whatever the scenario, trying to collect rent from a problem tenant is rarely a pleasant experience.