Plenty of individual real estate investors start their careers in rental property ownership because they see it as a great way to earn passive income. Many soon learn, however, that owning rental property isn’t exactly passive.
It takes some time and effort to manage rental properties. Even a single property carries with it enough duties that it can sometimes feel like a part-time job to manage it. If you wanted to earn extra income at a second job, wouldn’t you just get a second job?
There is a way to make real estate investments more passive, however: Hire a good property management company that does the job for you. Here are some important things that you should know about the power of outsourcing real estate management from experts at Valley Management Group, a leading San Jose property management company that has been serving clients for 40 years.
You get to sleep at night without calls from tenants
If you’ve heard horror stories about owning rental properties, they’ve likely included the dreaded midnight phone call. The roof is leaking. A pipe burst. A tree fell on the house. Your phone will ring when those things happen.
If you outsource real estate management, it will be someone else’s phone that rings. Most reputable property management companies have 24-hour emergency answering services. You also get the peace of mind of knowing that the person who does pick up the phone will immediately know what to do.
You don’t have to find and screen tenants
Many landlord problems are avoided by attracting and retaining quality tenants. However, it’s usually a big time-consuming effort to find quality tenants. You need to screen them to make sure there’s nothing in their background that indicates they’ll be bad tenants.
It’s especially important to get tenants who pay on time in an area like San Jose, where property costs and an owner’s mortgage payments are high. Good property management services must include full vetting of a tenant’s employment, income, and financial status.
You don’t have to chase rent
It’s frustrating when tenants don’t pay rent on time. It’s even more frustrating when you have to call them over and over, chasing that rent payment.
When you have a property management company handling your property, they will be responsible for collecting rent. You still might have the occasional late payment, but at least you won’t be the one chasing it down.
You get some legal coverage
Outsourcing real estate management also means covering yourself with some legal protection. The management company will have all the legal documents you need and will be up-to-date on all federal, state, and as well as local laws and regulations.
For example, a property management company that provides Los Gatos property management services would know all that’s required of a rental property in Los Gatos and ensure that your property is in compliance with all local laws and regulations. They should also inform you about any new or revised laws and regulations that apply to your rental property.
You get access to a professional network
When work is needed to repair or maintain a property that you manage yourself, it’s up to you to find trustworthy contractors and get quotes for the job. Unless you’re familiar with a few reliable and affordable contractors, this can be time-consuming and expensive.
Property management companies usually work with contractors and service providers they routinely use. If a tenant calls about a maintenance issue they will know whom to call. Property managers with years in the business have networks of contractors and other service professionals they know and trust. Outsourcing property management means getting access to their professional network.
For all the convenience and level of service property management companies provide, hiring a property manager is actually quite affordable. Most residential property management costs will range from 5 to 8% percent of the gross monthly rent depending on the type of rental property. The company collects the rent for you, deducts their fee, and then sends the rest to you. For more details on management fees, tenant marketing, and retention, tenant screening, and other benefits Valley Management Group offers, read the Property Management Company Evaluation Guide for Rental Owners.
The bottom line
How many more people would own rental property if they didn’t have to manage it on their own? Outsourcing real estate management means freeing up your time, giving yourself peace of mind, and even saving money. If you own a rental property in San Jose, Santa Clara, Los Gatos, or elsewhere in Santa Clara County contact Valley Management Group. They have been providing trustworthy and affordable San Jose property management services for 40 years and offer new clients a free property management quote with one free month of monthly services.
Reviewed and Approved by Lloyd Kipp
Property Manager and Owner of Valley Management Group