Welcome to the Topic “What does a property manager do?”
A property manager is a person or company employed to oversee the day-to-day operations of a property unit. Property owners and real estate investors mostly hire property managers when unwilling or unable to manage properties.
The costs incurred by engaging a property manager are often tax deductible against the income generated by the property. Apartment complexes, shopping centers, and offices are common commercial properties property managers operate.
Understanding property managers
Property managers offer a perfect solution for investors who don't live near their rental properties or are tired of handling tenants, toilets, and the like. Some real estate investors do not want to be direct with the investment, especially institutional real estate investors.
Property managers particularize in all operational aspects of ownership – things like handling security deposits and maintaining building safety standards. A property manager deals with tasks that ensure the smooth running of a property: managing rent, tenants, documentation, taxes, budgets, maintenance, and provision of records to the city and state. Property managers interact directly with tenants, especially regarding rent and maintenance, so they are often considered the "face" of the property.
Each property will have unique needs, and the property manager's responsibilities are outlined in the owner agreement. Owners with multiple properties can look to a property management company to coordinate all operations and oversight.
Because real estate management involves compliance with housing laws, some states require a license to manage real estate, either as a real estate agent or a licensed property manager. Property managers effectuate federal, state, and local requirements regarding tenant screening, evictions, lease terminations, and deposit processing.
What Kinds of Property Managers Are There?
There are three basic types of property managers:
- large family
- one family.
Some property management companies work with a mix of property types. Commercial real estate management focuses on office buildings and industrial spaces. Multifamily property managers specialize in multi-unit spaces, most commonly apartment complexes. Similarly, single-family home managers work in residential housing but focus on renting single-family homes instead of large complexes.
PROPERTY MANAGER VS. INNKEEPER
While a landlord and a property manager perform similar jobs in the industry, the main difference between the roles is that a property manager does not own the rental property. In contrast, a landlord owns the property that they manage themselves. Property managers essentially act as intermediaries between the property owner and the tenant.
A rental property owner appoints a property management company to maintain their investment, so they don't have to worry about day-to-day issues with tenants or the property.
A property manager must fulfill all the responsibilities of a landlord but is also in charge of managing money and records for multiple owners, tenants, and properties while following federal, state, and local landlord and tenant laws.
A property manager's responsibilities include rent management, tenants, maintenance and repairs, owners, owner-tenant laws, business operations, property records and accounting, and taxes.
The role played by the property manager
Every property has different needs, but in general, property managers:
- Set competitive rent prices to attract tenants
- Attract and screen potential tenants
- Coordinate rental agreements and security deposits
- Handling maintenance and move-in/move-out requests
- Collect monthly rent and track non-payment
- Maintain the physical condition of the property
- Hire and manage maintenance contractors as needed
- Managing the property budget (for repairs and maintenance)
- Manage all documentation: maintenance records, leases, claims, insurance, etc.
Property managers help owners set the correct rent to ensure the property is occupied by quality tenants and allow the owner to collect adequate rental income. An equally important role of the property manager is to collect the rent and notify the tenants of any rent increases.
Rent Determination: Property managers know the market rent rates in their area. They understand how to evaluate the properties of a property to find the best rental price that will help the owner value their investment and ensure it is always occupied.
Rent Collection: Property managers establish policies for collecting rent from tenants, including personal checks, online payments, verified funds, cash mailed, dropped off at a safe place, or picked up in person. Rent collection depends on which method results in the highest portion of prompt payments with minimal effort from both management and tenants. The property manager will also deal with late payments, unpaid rent, and the process of evicting a tenant due to non-payment of rent.
Rent Increases: Property managers facilitate legal and appropriate communication with tenants regarding rent increases. They will advise landlords on the pros and cons of raising rents to match market rates, pay for property maintenance or enhancements, adjust tax increases, or increase profits.
A property management company should have a straightforward rent collection procedure that outlines collection policies, late fees, how non-payment of rent will be dealt with, how tenant arrears are dealt with and how rent funds are paid to landlords.
The property manager's primary responsibilities include all tenant-related matters, including sourcing and screening applicants, communicating and enforcing lease terms, handling complaints, dealing with bad tenants, and managing tenant funds properly.
Finding Tenants: A property manager provides the requisite support in marketing available properties to find the most suitable tenant for the property. A vacant property is always a worry for a landlord, and the manager works hard to rent the property to the right tenant as quickly as possible. They will try to post For Rent signs, update online rental listings, host open houses, and communicate with current tenants to obtain qualified referrals.
Tenant Screening: The Manager will enforce the owner's requirements to find a qualified tenant who will pay rent on time, abide by the lease terms, and take care of the property by performing legal tenant screening. Legal tenant screening includes the evaluation of objective qualification criteria such as reliable income, employment verification, credit check, criminal history, and positive rental history.
Enforcement of Lease Terms: The manager will review important lease terms with tenants during the pre-residence lease signing. The manager will communicate appropriately with tenants if violations occur and enforce consequences during the rental period. The rental agreement should include policies on how the manager will deal with violations and the consequences for any violations and repeated violations. Violations can result in a fine, void the contract, or be grounds for eviction.
Complaint Management: Considered one of the biggest problems in property management, dealing with tenant complaints can take a lot of time and energy. A complaining tenant may raise concerns about property maintenance or other community-related issues regarding tenants or neighbors. The property manager may require tenants to provide written notices via email or the online tenant portal.
Eviction: Even the best tenant screening can cause a few bad apples to slip through the cracks, leaving the property manager to deal with the legal side of a tenant's request to move out. Eviction is lengthy, and the right property manager will know the proper steps to manage everything correctly.
Tenant Funds: The property manager collects rent payments and additional fees (such as late fees, pet fees, etc.) paid by tenants and is responsible for distributing them to the owner or business. The property manager must comply with federal and state requirements regarding trust accounting and tenant deposits.
Property managers work directly with the landlords they serve and must communicate relevant information regarding property performance, owner resources, and legal matters.
Owner Communication: Owners always want to be informed about their real estate investment performance. Property managers must communicate vacancy rates, income, and expenses concerning the property, maintenance requirements, and any legal matters related to the property. Property managers may email, call or provide online access to a property performance portal, sometimes called an owner portal. Property managers can also advise landlords on legal matters, setting rents, increasing rents, or carrying out maintenance/repairs to properties.
Attracting new owners: Understanding the types of individuals who own rental housing helps property managers create actionable profiles of their target audience. These profiles establish the needs and wishes of individual owners so that the property manager can best cater to them. A property manager will be able to lure new work and retain clients by doing what the owner needs during the process of purchasing the right property manager.
Landlord: The landlord is usually considered rent payments collected by the property manager from the tenant, which is then paid to the property owner. To properly (and legally) manage the owner's funds, the property manager must understand the basic principles of fiduciary accounting.
Trust accounts for property managers are typically used to keep tenant deposits and rent payments separate from working capital. The property manager must keep proprietary funds separate from working capital and follow state guidelines for depositing owner funds on the timeline.
Property managers are charged with the physical management of a rental property in terms of maintenance and repairs to make sure that the property remains in livable condition for current tenants and an attractive rent-ready condition for future tenants.
Maintenance: Property managers will perform routine and preventative maintenance for the owner to ensure the property remains in excellent condition. Managers will perform maintenance tasks personally, through on-site management, or hire contractors to complete the work. Maintenance can include landscaping, HVAC service, exterior cleaning, animal protection, gutter cleaning, etc.
Repairs: If the property requires home repairs, the manager will communicate the issue with the owner and schedule the repairs pending approval. Common property management repairs include repairs to plumbing and air conditioning systems, broken railings, replacement of light bulbs in common areas, etc. Management may note repairs during an inspection or bring them to the tenant's attention by the manager.
Inspections: The property manager will regularly check the rental unit to identify any maintenance problems that need fixing before they become costly and to ensure compliance with tenant-required maintenance. Inspections of rental properties may include move-in/move-out inspections, seasonal inspections, and drive-by inspections.
Turnover: A tenant turnover includes getting the property ready for rent between lease terms, picking up the keys and rental property, and returning the previous tenant's security deposit. The property manager will enforce eviction dates and charge the tenant accordingly if they do not vacate the unit on the agreed-upon date and time.
The vacated unit must be inspected, cleaned, and returned to the condition it was in at the beginning of the previous rental period. If the property owner wants to make further enhancements to the unit over time, the manager can help coordinate and oversee the maintenance of the property.
Property manager's duty to the property owner
Property managers are not owners of the property they manage. Property owners outsource day-to-day operations to property managers because they specialize in finding new tenants and know the legal specifics of leasing.
Property managers work for a property management company that coordinates the needs of several individual properties. On the other hand, the real estate company works directly for the property owner.
The responsibilities of a property manager can sometimes seem endless. However, they have a vital job to do. To describe a typical day at Philadelphia Property Management Company, our property managers will typically begin by reviewing the new maintenance requirements. This includes checking emails or voicemails for new requests that may have come in outside business hours.
Although every day is different, the property managers at Philadelphia Property Management Company strive to address older maintenance requirements. They then ensure that technicians or salespeople are assigned to specific tasks. An essential part of the job is to ensure that technicians take care of the maintenance issues of vacant units to prepare them for new tenants.
Once maintenance concerns are resolved, managers approve invoices, sign documents, and renew lease rental licenses. In addition, some of the most important jobs of our property managers at Philadelphia Property Management Company include:
- Sending tax documents to property owners
- Ensuring housing requirements and compliance with licensing conditions
- Overseeing housing inspections and reporting
- Planning and facilitating management threat inspections
Work is not always pleasant or fair. For example, one of the most challenging aspects of being a property manager is that it can be highly stressful and expeditive.
Since there are so many duties of a property manager, it can easily create tension and misunderstandings between tenants, property owners, co-workers, contractors, etc. To excel in this area, it is important to facilitate communication between all parties involved effectively.
Have any questions regarding the topic "What does a property manager do?" feel free to comment below.
Also Read: Types of property management