The number of renters in the U.S. has jumped in the past decade, driven in part by the foreclosure crisis that forced many people out of their homes. While the real estate market has stabilized to a point, buying a home is still out of reach for many Americans, especially younger ones laden with debt.
However, this also opened up an opportunity for investors to provide an alternative in the form of rentals. But becoming a landlord carries no guarantee of success, which is why there’s also a growing demand for property management companies that can take care of important details and help manage risk. The right property managers can maximize profits for real estate investors and they know the pitfalls to look out for.
With approximately 80,000 property managers in the U.S. as of 2016, more people are looking to take on a career in property management — which carries its own list of benefits. However, there are some important details to know before following this potentially rewarding path, says Jon Parrish of Naples, Florida, who has legal experience in the area of asset protection, while also overseeing several properties through his current businesses in the hospitality industry.
More Accreditations, More Chance of Success
Not just anyone can legally claim the title of property manager, explains Jon Parrish. Before moving forward as a professional in the industry, there are licensing requirements to meet.
The licensing is not only required for the profession, but the type of certifications a person needs also depends on the type of properties they plan to manage. For example, there can be additional requirements for managing public housing as opposed to private properties. Aside from achieving certifications to practice as a property manager, in many cases a real estate license is required as well.
To help get a foot in the door, it’s a good idea to bulk up on education and obtain certifications even if they aren’t needed to be a property manager in a particular jurisdiction. Property management companies — and even individual clients — will be more likely to trust services that are backed by professional credentials.
Proximity and Quick Response Are Key
When it comes to outshining other property managers, it often comes down to quickness of service and preparedness, explains Jon Parrish. The property management companies that are most successful are the ones who can respond immediately to an emergency such as a broken air conditioning system, which protects the reputation of the landlord and the respective property management company.
To help achieve this, it’s imperative to have staff on the ground near rental properties to reduce the time it takes to address a situation. There are also more streamlined processes helping property management companies stay a step ahead by automating some processes, while also making communication with tenants easier.
For example, some property managers have turned to live chat through a website to address concerns, while making showing for potential clients easier than ever. In addition, software can help automate maintenance by providing reminders for scheduled upkeep, which can help extend the lifespan of a rental property.
More Focus On Vacation Rentals
Managing long-term rentals for private landlords is an important aspect of the property management industry, but successful companies have also turned their attention to short-term vacation rentals, notes Jon Parrish. Vacation rentals is one of the fastest growing aspects of the industry, driven largely in part by companies such as Airbnb, he adds.
Consider that many vacation rentals may be geographically distant from the entity that owns the properties — which means vacation property owners need a solution to deal with renters without using up valuable resources. Demand for vacation rental management has grown to try and keep up with the increase in short-term rentals, which was expected to grow by more than $100 billion based on 2019 predictions.
Final Thoughts from Jon Parrish
Managing a vacation property extends beyond just dealing with maintenance problems that pop up. A successful company in this sector will also handle marketing in a competitive arena. Often a company that oversees vacation properties will set up a central office with local hubs to respond to issues more effectively, notes Jon Parrish.
With the increasing demand for property management, both for short-term and long-term arrangements, it’s an ideal time to enter the market or reach the next level.
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