What is Property Management

Property management is the process of managing real estate-related property that is available for lease. It includes maintaining and handling all the day-to-day activities done around the property. Property management also involves looking for tenants to occupy vacancies, collection of monthly rental payments, property maintenance, and general upkeep of the property.

Property Management Explained

When it comes to property management, the owner of the property or building may decide to manage it personally. Usually, a property manager is hired to manage a property on behalf of the owner, to preserve the value of the property and generate income on it. Other duties of a property manager are to help the owners advertise rental properties, create budgets, and comply with real estate board laws.

In property management, there are no restrictions on who can become a property manager, as such, some real estate brokers double as property managers. It is common to find real estate brokers that also offer property management services, alongside buyer and seller agent services. Owners who opt to use property managers pay a fee or percentage of the rent generated on a particular property while under management.

Why hire a property management firm?

Some owners look for individual property managers while some others opt for a property management firm, all for various reasons. The major reason why some owners prefer to use a property manager is that they lack the expertise or time to personally maintain their rental properties and deal with tenants. While some property owners are not necessarily interested in knowing what goes on with their property, all they’re concerned with is owning rental properties and making cool cash off of them. Absentee landlords also require the services of property managers to maintain their rental property.

Property owners who wish to participate in affordable housing programs but lack the appropriate expertise to participate such as federal housing guidelines, make use of the services of property managers.

Property Management Authorizations

The requirements to become an authorized or licensed property management firm differs among the states. The majority of states require intending property management firms to be licensed by the local real estate board. A real estate broker’s license will allow property managers to list their rental properties in multiple listing services (MLS). It also allows them market properties by standard real estate marketing methods. With a real estate broker’s license, property managers can place a real estate board lockbox on a property to allow other licensed agents show the property. Some other states like Florida, Illinois, and Delaware require property management companies that offer on-site management services to condominium communities to have community licenses.