Owning a rental property brings both advantages and disadvantages. Two important advantages are the relatively steady stream of income and inflation protection. But, the disadvantages create a lot of headaches when managing both the legal and financial complexities along with the interpersonal interactions with tenants. Many self-managing owners might start wondering about the types of rental property a property manager can handle.
The U.S. Department of Housing and Urban Development estimates that there are between 10 and 12 million landlords in the US. The vast majority, approximately 10 million, are individual “mom and pop” owners, while corporations make up the remaining one to two million. Interestingly, individual owners tend to manage and maintain their properties with limited training, while businesses tend to hire full-time professional companies to manage their properties. But, with increasingly complex tax codes and changing legal requirements, utilizing a property management company’s wide and varied expertise is increasingly helpful to landlords of all varieties as a way to decrease the stresses of real estate ownership.
Types of Rental Property a Property Manager Can Handle
Residential property is a broad umbrella term for a varied landscape of rental options tenants search for, and property management companies oversee. Each type comes with both advantages and complications a property management company can help explain, promote, and mitigate as needed. The most common types include:
These stand-alone dwellings come with direct access to a yard or outdoor space. Unattached homes allow for privacy and space for the tenant, more parking options, and room for pets. These properties are especially attractive to families and tenants interested in long-term stable rental options. Owner complications can include more complex maintenance needs, location (managing multiple properties in different places often leads to more driving and less convenience), and ensuring occupancy of this single source of income.
Apartments typically have a higher market value for the owner. They can also provide steady income without the worry of an empty unit. But, there are also more significant costs, which include: a higher price tag to buy, property taxes, insurance premiums, and maintenance costs. Managing many tenants and their needs introduces another complication. There are two typical styles of apartment buildings:
Low-Rise Apartments. These buildings have one to four floors, so it’s apartment living but with fewer neighbors, greater privacy, and a quieter day-to-day environment. These buildings often have more security with private entrance doors for residents, and parking may be easier.
Large Apartment Buildings. These buildings are often over seven stories high, with at least 100 rental units. Because of their size, they can offer access to additional features like pools, on-site gyms, and public green spaces. Tenants usually have low maintenance requirements, and landlords can often provide bundled services for lower-cost utilities and wi-fi. Large apartment building owners can anticipate a large volume of tenant complaints, needs, and requests. They also must manage the maintenance of shared spaces for health and safety issues.
These properties combine the advantages of single-family and apartment living. Many townhomes are found in gated communities with additional amenities like pools or other shared spaces. Townhomes are usually two-story, so tenants can enjoy additional space without large yard work requirements. And because there are multiple units in a development, one property vacancy does not mean a complete loss of income for the owner. Complications for the owner usually involve dealing with homeowners association requirements such as additional fees, restrictions of use, and rules for decorum.
The Value of a Property Management Company
Is hiring a property management company worth it? A good property management company brings peace of mind. Companies can implement standard practices for advertising, screening, and interacting with tenants designed to find and retain the best tenants for the property. They stay updated on the latest state and city regulations to ensure compliance with complex legal requirements. And they invest years of relationship-building with local trade skilled vendors for quality and fast maintenance and repairs. When choosing your property management company consider these three categories:
- Reputation: Do they offer clear information on their fees, proper licensing, and experience with local and state laws?
- Scope of Services: Do they offer services to advertise, screen tenants, clean and prep units, create and manage legal documents, handle evictions, and perform routine maintenance?
- Communication: Have they established clear protocols for communicating with current and prospective tenants?
The scope and breadth of experience that a property management company brings to the table can make the rewards of owning a rental property even greater.
Partner With the Experts
There is a lot to think about when deciding to take on a rental property, and talking with an expert can help you make the best decision for long-term success. With a commitment to providing our community with a reputable service, Rent Portland Homes with Darla Andrew manages properties with efficiency and innovation. Our team has over thirty years of experience advising clients on industry best practices to keep up with our ever-changing market. Call or text Darla Andrew today at 503.515.3170 to learn more about how we provide the support you need to confidently enjoy the rental process.