Many properties today are not owned by the person who lives in them. While a large part of the American housing market is based on a person buying a house and moving in, many other households choose to rent instead. There are many different reasons why a person or household may rent a house or apartment, and these renters will pay due rent to the owner in exchange for living there. Often, this paradigm works quite well, and the property owner may work indirectly through one or more property management companies. Once an entrepreneur decides to buy real estate or homes for sale and rent out those properties, they may take a hands-on or a hands-off approach. In the case of hands-off, various property management companies can be hired to act as a third party. That can prove very helpful in most cases. How might that arrangement work?
The Rental Market Today
A lot of Americans rent their living space, and this industry is quite robust today. Estimates say that there may be 115 million occupied housing units across the U.S., and many of them are rentals of all shapes and sizes. Meanwhile, the Rental Protection Agency has stated that the rate of new renters is growing. Every day, according to these numbers, some 2,654 new people are entering the rental market every single day. The same Agency also reported that the rate of new landlord is growing as well; in particular, 544 new people are entering the rental market each day as landlords rather than as renters. Who are those renters? Often, property is rented out to college students who cannot yet afford their own living spaces, and if those students can’t get dorms on campus, they will rent out apartments reasonably close to campus. Young adults today are still building up their spending power, and their transient lifestyles mean that permanent housing may be impractical. Other renters are those who are living in an area for just a short time for work or similar reasons.
Using Property Management Companies
As mentioned earlier, a landlord may choose one of two routes when handling their property: take care of rent matters themselves, or use property management companies as intermediaries between them and tenants. Some landlords may take a more hands-on approach to this if they are only managing a few properties at a time, being easy to juggle. An experienced landlord handling just a few properties may not need assistance, and managing those properties may be even easier if the landlord lives close to them.
But some circumstances may call for property management companies to be used. For example, the landlord may live remotely from those properties, making it challenging to administer them from far away. In other cases, a property owner has quite a few properties on their hands, some of which might be rather large and house many people at once. Juggling all that may prove a real challenge, but property management companies can handle all that with ease. It may also be noted that some landlords own those properties strictly as an investment, and they are not interested in landlord duties outside of making a profit. In that case, they may eagerly want property management companies to handle matters while the landlord pursues other interests.
It may also be noted that these property management companies are business partners of a sort, but the staff at such property management companies are not the landlord’s own employees. They are independent contractors, which may eliminate complications with starting business with property management companies or ending those partnerships. It may cost money to hire these property management companies, but if a landlord finds a reputable and reliable property management company that has the talented staff to manage the properties, this partnership may greatly pay off. Landlords may refer to the other members of their housing association to get recommendations for good property management companies, as well as look online and find these property management companies through certain websites. And of course, a landlord may compile a short list of candidate property management companies and interview their representatives before deciding which one to work with.