Were you aware that the median home sale price in the U.S., as of the second quarter of 2023, was $416,100? According to The Motley Fool, that’s up 26% from 2020, when the median home sales price was $329,000. That means you’ll be paying a pretty penny if the goal is to buy an investment property this year.
You’ll want to ensure you’ve cleared off any consumer debt, saved enough money to make a reasonable down payment, and saved money for closing costs and maintenance.
Another thing to consider before buying an investment property is whether you’ll be the landlord or if you’d be better off hiring a property manager to serve as the landlord on your behalf.
Some people immediately hire property management firms to help them with their tenants and real estate assets. But others get hung up on the percentage of rental income that they have to pay to get the services of a property manager.
Should you do it yourself or get some help by hiring a property manager? Keep reading for some reasons why you’re better off getting the help a service provider can provide.
Get Help Marketing Your Property
Have you heard the saying that if you build it, they will come? The reality is that simply owning a rental property doesn’t guarantee you’ll find people who want to live there. Sure, if there’s a housing crunch where you’re located, you might have no trouble finding tenants. But if there’s competition for rental units, you’ll have to up your game to get the quality tenants you want.
A property manager can help you market your investment property. They will come up with copy that provides the information renters are looking for, publish ads in the right publications, and advise you on how to make your rental property more enticing.
Get Help Setting the Right Rent
One of the ways to attract the right tenants is to offer competitive rental rates. You need to know the real estate market in your area to choose the right rates. If you charge too much or too little, you’ll jeopardize your investment by scaring off tenants or bringing in too little rent. A property manager can conduct a rent analysis — factoring in the peculiarities of your area — to recommend how much you should be charging your tenants.
A property manager can also recommend upgrades or renovations to ensure your rental property is competitive with other properties in the area. For instance, if comparable investment properties in the region offer quality laminate flooring while you offer carpeting, you should consider upgrading.
Hiring a property manager means getting information that helps you make informed decisions.
Get Help Taking Care of Your Investment Property
People buy rental properties to enjoy the property valuation increases over the years and decades of ownership. Hiring a property manager can ensure your asset is properly maintained and repaired so the valuation doesn’t stagnate or drop over time.
Doing maintenance and repair projects might be difficult if you’re busy doing other things. With the help of a property manager, you won’t have to worry about doing everything yourself.
So, is hiring a property manager to help manage your investment property worthwhile? It is if you want the sort of help mentioned above. A property manager can help you with the abovementioned things and a lot more, like finding good tenants, collecting rent, and even evicting tenants who are not paying rent or are damaging your property.
Your best bet is to look at the services available and consider whether or not they’re worth hiring a property manager for.