Owning a rental can be a great investment and a good source of steady revenue. Furthermore, rentals can provide the opportunity to increase your portfolio via real estate holdings.
A rental agent conducts duties associated with managing rental properties and locating successful tenants who will fill vacancies. They may also offer services to current tenants or provide assistance with lease renewal.
You’ll discover you need an agent to handle the care and maintenance especially if you own several rentals. Nevertheless, here’s a list of things that will help you establish whether you should hire a professional.
1. The Property Location Compared to the Primary Residence
The more miles between you and the investment property, the harder it is to run. You’ll find it harder to locate tenants, respond to emergencies fast, handle tenant complaints, and maintenance issues.
The time and cost it takes to arrive at the property will also add up. In such situations, hiring a good property manager or agent is sensible and saves you money.
2. Your Experience
If you wish to invest in real estate but are clueless about property management, hiring a knowledgeable agent can be the appropriate choice for you.
Bear in mind that learning as you go can be very costly, for instance if you’re just starting out you could end up with the wrong repairman or take too long to fill a vacancy. This can eat into your potential income fast.
3. Commitment Outline
The best agent may have numerous properties to manage, so obtain an outline of how your property will fit into the existing management structure.
Establish how frequently the agent will visit the property in person and determine how the agent will approach your property’s needs, from lease renewals to tenant screening.
4. References
You can obtain references from other property owners or agents. When obtaining a reference, ensure the other property resembles yours in scope and size; otherwise you might set yourself up for failure.
Therefore, you must assess a representative sample of the properties your candidate is currently managing. Consider asking for the addresses for some of the other rentals the agent is managing and check whether they’re in good shape.
5. Your Finances
Before hiring a property manager, you must evaluate your finances. Bear in mind that property managers charge between 4% and 10% of the monthly gross revenue for the property on average.
The typical charge for a single-family rental is closer to 10% while the typical fee for a property of 10 or more units is between 4% and 7%.
It’s also important to note that some managers will charge fees for tenant placement, which is a bonus for locating a tenant. Beware that the fees will differ from a few hundred dollars to a month’s rent.
6. Market Knowledge
The agent should have extensive coverage, knowledge, and understanding of the market. The person should also be able to offer advice on the amount of rent you can obtain, improvements that could potentially increase the rent, and the present vacancy rates.
An agent should also offer appropriate time alerts when the lease is due for renewal or coming to an end.
7. Match Personality
You’ll be hearing from the agent frequently enough that you want to ensure you get along and like their communication style. You also need to recognize that you’ll be working with the person to resolve issues and you need to be on the same page.
Final Thoughts
While hiring a rental agent is a personal decision, it’s not the right move for everybody and you must consider various factors. If you’re wondering where to start, this guide will prove beneficial.
For more information on rental agents, contact us at Apartment Agents or leave a comment.