If you’re in college right now, you’re likely focused on lectures, coursework, and essays. But that doesn’t mean you can’t think about what comes after earning your degree, starting your career, and becoming a contributing member of society.
Down the road, you might dream of investing in real estate. You don’t have to spend an arm and a leg to buy a home. You can get something relatively reasonably priced if you’re open-minded about the location, property size, and overall condition of the investment property. If you have some D.I.Y. skills, you might be able to pick up a property for a steal and fix it up.
Investing in real estate can be part of a plan to build a solid financial foundation. A lot of your people who are part of the F.I.R.E. movement focus on real estate. F.I.R.E. is an acronym for financial independence, retire early. If that’s your goal, you’ll want to diversify by saving money, investing in stocks and index funds, and potentially buying an investment property.
But if you do buy a rental property one day, is it worth paying a property management firm a monthly commission of between 6% and 12% of rental income?
You might reason that it’s best to manage your rental property yourself and pocket what would otherwise be paid out in commission to a third party. But is doing so really in your best interests?
Continue reading to learn about why hiring a property manager makes a lot of sense.
- You Have Other Things to Do
Just because you own a rental property doesn’t mean you can’t have a life anymore. A lot goes into managing a rental unit and the tenants renting the property. Do you have the bandwidth to take care of the day-to-day responsibilities of running a rental property? Are you able to field calls from tenants? Remember that some of those calls will come outside of regular business hours. If you manage your rental property, you’ll pretty much be tethered to it.
Why not hire a property manager and spend more time with family, concentrate on other investment opportunities, or just focus on developing a good work-life balance? If you have to take care of your property alone, you won’t have free time.
As the owner of a rental property, you’ll be in charge. But a property manager can manage things on your behalf.
- Finding Quality Tenants Is Hard Work
It’s essential to find the right tenants. But most property owners don’t know how to go about it. Property managers, meanwhile, are skilled at helping their clients find quality tenants. The property manager you retain will ask prospective tenants to submit references, get employment history information, seek information about previous landlords, and more. The last thing you’ll want are tenants who cause you headaches, after all.
- Setting Competitive Rates Is Essential
Property managers understand the rental markets that they serve. So, if you’re not sure what to charge tenants, you can bet that the property manager you hire will be able to advise you. You’ll want to set competitive rates. And if maximizing your rental income means updating your rental property, the property manager will let you know. You won’t be flying blind. You’ll get help.
Even though you’re still in college, it doesn’t hurt to think about what you’d like to do after graduating, getting a job, and saving some money. Consider whether owning rental property is in your future.
If so, a property manager is a good investment. It’ll make investment property ownership a less stressful experience.