There are numerous career opportunities within the real estate industry, ranging from becoming a broker to a property manager. Property management stands out as a particularly promising career path within the real estate sector. If you’re interested in discovering more about the role and responsibilities of a property manager, continue reading.
Learn what a real estate broker actually does?
Property manager: Meaning
A property manager is a skilled individual responsible for the oversight and upkeep of properties on behalf of their owners. Their duties encompass a range of tasks including property maintenance, tenant screening, rent collection, and lease management. Property managers facilitate the seamless functioning of properties, alleviating owners from the burdens of day-to-day management. Serving as intermediaries between property owners and tenants or leaseholders, they strive to ensure a positive and stress-free experience for both parties involved.
What does property manager do?
Owning a rental property can be rewarding, yet it entails a complex array of responsibilities. Property managers serve as invaluable allies, ensuring the smooth operation of your investment. Let’s delve into their important roles.
- Seeking reliable tenants: Tenant selection is critical, and property managers excel in this area. They handle the entire process, from property advertising to meticulous applicant screening. Their aim is to secure responsible tenants who respect your property and contribute positively to its success.
- Knowing rental laws: In the intricate landscape of Indian rental laws, property managers serve as your legal guide. They navigate regulations, ensuring your property complies with all requirements, keeping your investment lawfully sound.
- Tenant relations: Property managers become the main point of contact for tenants, managing their experience from lease signing to repair requests. By fostering positive relationships and ensuring clear communication, they maintain a harmonious rental environment.
- Resolving disputes with tenants: Disagreements are inevitable, and property managers act as impartial mediators, resolving concerns fairly while safeguarding your interests.
- Collecting rent: Property managers handle rent collection professionally, eliminating the hassle of chasing late payments. They ensure prompt collection and address any financial concerns, freeing you from rent-related issues.
- Maintaining and repairing property: Proactive maintenance is vital, and property managers coordinate repairs promptly to keep your property in excellent condition and prevent costly issues.
- Assisting with property tax: Property managers handle property tax paperwork and payments, easing the administrative burden and ensuring timely compliance.
- Managing budget and tracking expenses: Property managers handle financial aspects, from bill payments to expense tracking, providing transparency to your property’s financial performance.
- Ensuring peace of mind: By expertly managing these tasks, property managers provide peace and security, allowing you to focus on growing and managing your real estate portfolio effectively.
Types of property manager
There are several types of property managers, including:
Residential property manager
Residential property managers are typically tasked with overseeing rental properties, managing the entire rental process. They can be employed to manage various types of residential properties, including:
- Multifamily homes
- Single-family homes
- Townhouses
- Vacation rentals
- Condominiums
- Manufactured homes
- Apartments
- Real estate owned (REO) properties
Commercial property manager
Commercial property owners have distinct needs compared to residential property owners. Commercial property management encompasses:
Retail properties like restaurants, malls, and petrol stations
Public accommodations like hotels
Office properties like medical practices or real estate agencies
Co-working spaces where professionals rent workspace on a daily or hourly basis
Industrial property manager
Management services for industrial properties extend to:
- Light manufacturing factories like food packaging facilities
- Heavy manufacturing facilities, such as steel mills and automotive plants
- Distribution centres
- Warehouses
Special-purpose property manager
Some properties require management that doesn’t fit neatly into traditional categories. These include:
- Sports arenas
- Theatres
- Resorts
- Schools and universities
- Senior care facilities
- Places of worship
Who needs a property manager?
Various types of property owners can benefit from the services offered by property managers. For instance, landlords often engage property management firms for diverse reasons. Some may possess multiple rental properties in their portfolios but lack the time or expertise to manage them and handle tenant interactions. Others may solely seek to own rental properties for profit and thus enlist professional property managers. Absentee landlords, who are owners not physically present at the property location, also frequently utilise property management services. Additionally, some property management companies specifically cater to individual landlords renting out a single property, such as a vacation home.
Property owners participating in affordable housing programs commonly enlist property management services due to their rental properties being subject to intricate federal guidelines necessitating specialised knowledge. Certain real estate brokers also function as property managers. For instance, a broker in a resort area may offer buyer and seller agent services alongside property management services. In such cases, the real estate broker handles listing, leasing, showing and maintenance tasks for numerous property owners’ vacation rentals.
Hiring property manager: Pros and cons
There are both advantages and disadvantages to consider when opting to engage a property manager to oversee your investment properties. Before making a decision, consider the pros and cons, as well as your budget and personal requirements.
Hiring property manager: Advantages
Here are some of the major benefits of hiring a property manager.
- Beneficial for those with multiple properties: Managing multiple properties can be challenging while ensuring tenant satisfaction. Employing a property manager ensures that your properties and tenants receive the necessary attention and care, even if you’re unable to manage them yourself due to time constraints.
- Relief from operational tasks: Entrusting your properties to someone else means they will handle maintenance and upkeep responsibilities. Instead of personally handling repairs, you can rely on the property manager or their maintenance team to manage these tasks efficiently.
- Allows investment in distant locations: Working with a property manager or management company enables you to invest in properties located far from your vicinity without worrying about remote management. This flexibility allows you to explore investment opportunities in various geographic areas.
Hiring property manager: Disadvantages
There are potential drawbacks to consider when working with a property manager.
- High management costs: Property management services come at a cost. As mentioned earlier, you’re likely to incur various fees for the services provided by a property manager. These expenses can constitute a significant portion of your monthly rental income. It’s essential to research property managers thoroughly to ensure their fees align with your budget.
- Relinquishing control: Collaborating with a property manager means surrendering some direct control over your property and allowing them to handle matters on your behalf. While this alleviates the hands-on management burden, it also means they may implement procedures differently.
- Screening process rigour may vary: Property managers typically oversee the tenant screening process for your properties. While they maintain screening standards, they may not be as stringent as you would be when screening tenants personally. This difference in approach might not sit well with some real estate owners.
Property manager: Cost
The cost of engaging a property manager varies depending on the specific company and location. On average, it typically ranges between 6% to 12% of the property’s total monthly rental income, as reported by Mynd Property Management. In addition to a percentage-based management fee, you may encounter the following costs when working with a property manager.
- Maintenance fee: Maintenance expenses are inherent in property management, whether you enlist professional assistance. Certain property managers may levy a fee to cover monthly repair costs for tenants, while others may charge per incident. Additionally, the manager or management company may impose an extra fee for their services in managing maintenance incidents.
- Management fee: Some property managers or companies may charge a fixed fee for their services instead of a percentage. Like the percentage-based fee, this cost varies depending on the company, individual, and location.
- Lease-renewal fee: Some property managers may charge a fee when a tenant wishes to renew his lease. This fee, like others, may be a fixed rate or a percentage of monthly rent. It covers the time taken to renew the lease and obtain the tenant’s signature. However, many property managers may waive this fee.
- Leasing fee: Your property manager might impose a leasing fee (also referred to as a new tenant placement fee) to cover expenses related to marketing your property to potential tenants. This includes marketing costs, application and tenant management, and move-in expenses. Like other fees, this may be a flat rate or a percentage of monthly rent.
How much do property managers make?
The average annual salary for property managers in India is approximately Rs 6.3 Lakh per year. The salary range for property managers typically falls between Rs 2 Lakh to Rs 12 Lakh per year, with an estimated take-home salary of Rs 6.2 Lakh per year. However, it’s essential to note that these figures may vary based on factors, such as location, experience, and industry.
Housing.com POV
Property management is a multifaceted field that offers both challenges and rewards. Property managers play a crucial role in ensuring the efficient operation and maintenance of rental properties, handling tasks ranging from tenant management to financial oversight. While engaging a property manager incurs costs, their expertise can ultimately save landlords time and effort, allowing them to focus on other aspects of property ownership. Additionally, property management presents opportunities for professionals seeking careers in real estate, with salaries varying based on factors, such as experience and location. Overall, understanding the complexities and benefits of property management is essential for both property owners and aspiring professionals in the field.
FAQs
What is a property manager?
A property manager is a professional who oversees the operations, maintenance, and financial aspects of a property on behalf of the owner. His responsibilities include rent collection, tenant management, property maintenance, and ensuring compliance with local regulations.
What are the duties of a property manager?
Property managers handle various tasks, including advertising vacancies, screening potential tenants, conducting property inspections, coordinating repairs and maintenance, collecting rent, handling tenant complaints, and managing financial records, such as budgets and expenses.
Is hiring a property manager worthwhile?
It varies. Property management can incur expenses and demand significant time. If the cost of a property manager is lower than the opportunity cost of managing properties independently, it's likely a wise investment. Nonetheless, this is a calculation each investor must assess individually.
Who can benefit from employing a property manager?
Anyone who prefers to avoid the day-to-day management of a property can potentially benefit from property management services. This includes residential property owners seeking relief from tenant-related concerns, and commercial property owners who prefer delegation of tasks such as tenant sourcing, lease management, and maintenance.
Are property managers subject to regulation?
Indeed. Property management licensing criteria differ by region, but most states mandate property management companies to hold licensing from the local real estate board. Property owners should verify that the firms they engage with possess appropriate licensing.
| Got any questions or point of view on our article? We would love to hear from you. Write to our Editor-in-Chief Jhumur Ghosh at jhumur.ghosh1@housing.com |