Did you know the median listing home price in Los Angeles was $1.2 million in May? That’s up 18.4% compared to the same month a year prior.
The median sold home price for May 2023 was $925,600, according to Realtor.com.
Whether you’ve saved the money for an investment property or you’re applying for a mortgage to buy one, you need to think about what’s best for your investment. Yes, you can wear two caps and join the ranks of owner-landlord. But there’s another option worth considering.
You can hire a property management company for a percentage of your monthly rental income. The percentage each month can be anywhere from about 8% to 12%. You might be wondering if it’s worthwhile to give up a percentage of your monthly rent for some assistance.
Keep reading to see why it makes sense to retain the services of a property manager if you either plan to buy a home someplace in L.A. or are the landlord of such a property already.
Of course, the goal for any investment property owner is to have 100% occupancy. That’ll ensure you get monthly passive income from rent that you can spend, save, or invest. But how do you market your vacant rental units to reach your target demographic effectively?
One option is to hire a property manager. They know how to craft the perfect marketing ads, where to post those ads, and how to increase the effectiveness of your marketing budget. In other words, it’s best to partner with a property manager that can help you fill vacancies. A property manager will also ensure that vacant units don’t stay unoccupied for long.
They will handle the marketing and other aspects of finding tenants likely to stay for a long time.
Finding your tenants is one thing — but finding quality tenants who’ll pay their rent like clockwork, respect your property, and follow the rules requires applicant screening.
A property manager can handle everything from the application stage to when you hand a successful applicant the keys to a rental unit. Success as an investment property owner hinges on finding quality tenants. While there’s no way to guarantee someone won’t cause you headaches, there are ways to increase the chances of finding people who’ll be great tenants.
It all starts with a screening process. You can count on a property management firm to conduct background checks, request work history documentation, ask for proof of sufficient finances, conduct in-person interviews, and do other things to find the right tenants.
Are you charging enough for rent? How do you strike the right balance between setting a fair rent for tenants and not leaving a lot of money on the table? A property manager will know the real estate market in your region and can advise you of the right rent to charge for a property like yours. Having professional feedback can help you maximize your monthly rental income.
You don’t have to change a thing if you don’t want to. But it can be helpful to see whether what you’re charging for rent is in the ballpark of what you should be charging.
Regular Upkeep and Repairs
Another reason it makes sense to hire a property manager is to stay on top of regular upkeep. It’s essential to ensure your rental property remains in good shape. A property manager will coordinate and spearhead the maintenance effort so your investment property grows in value. Remember, as well, that tenants want to rent from landlords who take care of their properties.
When you have a reliable third party maintaining your rental property, you’ll be able to avoid the type of costly repairs caused by neglect. It pays to get some help with regular upkeep.
Yet another reason it makes sense to hire a property manager is that you’ll get help with customer service. You can request that tenants get in touch with the property manager whenever there’s an issue that they need to have addressed. So, you won’t have to worry about getting late-night phone calls from tenants who want to report that something’s not working right.
Hiring a property manager is a win-win for you as a property owner and your tenants. On the one hand, you won’t be tethered to a telephone or glued to your rental property. On the other hand, your tenants will get the care they deserve.
These are some reasons why you might want to consider hiring a property management firm for your rental property. Whether you’re thinking about buying an investment property or you already do, mull over the benefits of getting some help managing your property and caring for your tenants. You’ll likely see that the help you get is worth the investment.