Maximizing Returns: The Case for Hiring a Property Manager for Long-Term Rentals

Managing a long-term rental property can be a demanding and time-consuming endeavor. From tenant screening to property maintenance and rent collection, landlords juggle various responsibilities to ensure the smooth operation of their investments. However, many property owners find that enlisting the services of a professional property manager offers numerous benefits, ultimately leading to higher returns on their investment. Let’s delve into why having a property manager for a long-term rental is advantageous, backed by statistics demonstrating increased profitability and reduced vacancy loss.

Streamlined Tenant Screening:

Property managers are adept at conducting thorough tenant screenings, which are crucial for securing reliable and responsible tenants. By employing stringent criteria and utilizing comprehensive background checks, they can identify applicants with stable incomes, positive rental histories, and strong references. This rigorous screening process minimizes the risk of problematic tenants, such as those who may default on rent payments or cause property damage.

Efficient Property Maintenance:

Maintaining a rental property in optimal condition is essential for preserving its value and attracting desirable tenants. Property managers oversee routine maintenance tasks, promptly address repair requests, and coordinate necessary renovations or upgrades. Their proactive approach to property upkeep ensures that tenants remain satisfied and the property retains its appeal, thereby reducing turnover rates and minimizing vacancy periods.

Timely Rent Collection:

Consistent rent collection is vital for maximizing cash flow and ensuring the financial stability of a rental property. Property managers enforce lease agreements, monitor rent payments, and promptly address any delinquencies. Their professional handling of rent collection procedures minimizes the likelihood of late or missed payments, thereby safeguarding the landlord’s income stream and minimizing financial disruptions.

Statistical Insights:

According to industry research, properties managed by professional property managers tend to yield higher returns for landlords. A study conducted by All Property Management found that landlords who employed property management services experienced an average return on investment that was 13% higher than those who self-managed their properties, even after accounting for management fees. This significant difference underscores the value that property managers bring to the table in optimizing rental property performance.

Moreover, property managers play a pivotal role in reducing vacancy loss, which can have a substantial impact on a landlord’s bottom line. Research conducted by Buildium revealed that properties managed by professionals experienced vacancy rates that were 50% lower than self-managed properties. By minimizing vacancy periods and ensuring timely tenant turnover, property managers help landlords maximize rental income and mitigate revenue losses associated with vacant units.

In the competitive landscape of long-term rentals, hiring a property manager is a strategic decision that can lead to enhanced profitability and peace of mind for landlords. By delegating day-to-day responsibilities to experienced professionals, property owners can benefit from streamlined tenant screening, efficient property maintenance, and consistent rent collection practices. The statistical evidence supporting higher returns and reduced vacancy loss further underscores the value proposition of partnering with a reputable property management firm. Ultimately, entrusting the management of a long-term rental property to skilled professionals empowers landlords to optimize their investments and achieve long-term financial success.

Quality Tenants – How and Why

Owning rental property can be a lucrative investment, but one of the most crucial aspects of successful property management is selecting the right tenants. Finding reliable, responsible individuals or families to occupy your rental units can significantly impact your bottom line and your peace of mind as a landlord. In this guide, we’ll explore the importance of qualifying good tenants and provide actionable tips for effectively screening prospective renters.

Why Tenant Screening Matters:

  • Financial Stability: Good tenants are those who have a steady income and can afford the rent without difficulty. A thorough screening process helps identify applicants with stable employment and a positive credit history, reducing the risk of missed or late payments.
  • Property Maintenance: Responsible tenants are more likely to care for your property as if it were their own. They’re inclined to report maintenance issues promptly, preventing minor problems from escalating into costly repairs.
  • Legal Compliance: By choosing tenants who have a history of following lease agreements and respecting property rules, landlords can minimize the risk of legal disputes and eviction proceedings.

Qualifying Good Tenants:

  • Establish Clear Criteria: Define your ideal tenant profile based on factors such as income level, credit score, rental history, and references. This will streamline the screening process and ensure consistency in your decision-making.
  • Require Rental Applications: Have all prospective tenants complete a comprehensive rental application. This document should gather essential information such as employment details, income verification, previous rental history, and references from former landlords.
  • Conduct Credit and Background Checks: Obtain written consent from applicants to perform credit and background checks. Reviewing credit reports can reveal an applicant’s financial history, including outstanding debts and payment patterns. Background checks can uncover any criminal records for offences that could affect the tenancy or prior evictions.
  • Verify Income: Request proof of income, such as pay stubs or tax returns, to confirm that applicants have the financial means to afford the rent. Ideally, tenants should earn at least three times the monthly rent to ensure they can meet their financial obligations.
  • Contact References: Reach out to previous landlords and personal references provided by the applicant. Inquire about the tenant’s rental history, reliability, and behavior as a tenant. This firsthand feedback can provide valuable insights into the applicant’s suitability as a tenant.

Qualifying good tenants is an essential aspect of successful property management. By implementing a thorough screening process that includes background checks, income verification, and reference checks, landlords can mitigate risks and maintain the integrity of their rental properties. Remember, investing time and effort in selecting reliable tenants upfront can save you from headaches and financial losses down the road. With the right tenants in place, you can enjoy a mutually beneficial landlord-tenant relationship built on trust, respect, and accountability.

Someone wants to rent my house – now what?

One of the most critical aspects of managing your rental property is selecting the right tenants. Tenant screening plays a pivotal role in safeguarding your investment and maintaining a harmonious landlord-tenant relationship.

Why is Tenant Screening important?

  1. Financial Security: A thorough screening process helps ensure that prospective tenants have a stable financial background, reducing the risk of late payments or defaults on rent.
  2. Property Protection: Screening applicants helps mitigate the risk of property damage and minimizes the likelihood of damaging behavior or lease violations.
  3. Legal Compliance: Adhering to fair housing laws and conducting consistent screening practices helps landlords avoid discrimination lawsuits and legal complications.

Key Components of Tenant Screening:

  1. Rental Application: Start by requiring all prospective tenants to complete a detailed rental application. This document typically includes personal information, employment history, rental history, and references. ALL APPLICANTS SHOULD ALWAYS HAVE TO COMPLETE THE SAME RENTAL APPLICATION!
  2. Credit Check: Obtain authorization from applicants to conduct a credit check. Reviewing their credit history provides insights into their financial responsibility, including existing debts, payment history, and any past evictions or bankruptcies. Even if their credit score meets the required minimum, money owed to landlords or utility companies is a red flag.
  3. Income Verification: Verify applicants’ income to ensure they have the financial means to afford the rent. We do this by reviewing pay stubs, employment verification letters, or tax returns to confirm their income level and stability. Typically, we require income equal to at least 3 times the rent.
  4. Criminal Background Check: Conduct a criminal background check to identify any past convictions that may pose a risk to the safety and well-being of other tenants or the property itself. You cannot deny an applicant for having any criminal background – HUD has guidelines to determine what can be used to disqualify a potential tenant.

Best Practices in Tenant Screening:

  1. Consistency: Establish standardized screening criteria and apply them consistently to all applicants to ensure fairness and compliance with fair housing laws.
  2. Timeliness: Process applications promptly to avoid losing qualified applicants to competing rental properties. Set clear expectations regarding the screening timeline to keep both parties informed.
  3. Communication: Maintain open and transparent communication with applicants throughout the screening process. Inform them of any requirements or documentation needed and address any concerns or questions they may have.
  4. Documentation: Keep detailed records of the screening process, including rental applications, screening reports, and communication with applicants. This documentation serves as a crucial reference in case of disputes or legal issues.

TeamWork Property Management has a proven system for evaluating applications to get the most desirable and highly qualified tenants possible.

Advertising – How do people find your property?

As a property management firm, we have systems in place to advertise our vacant properties. Understanding where and how potential tenants search for rentals is crucial for maximizing your property’s exposure and minimizing vacancy periods and we put a lot of time and effort into developing these systems.

Website and SEO: A professional and user-friendly website showcasing your rental properties is essential. Implementing search engine optimization (SEO) techniques ensures that our website ranks high in search engine results when potential tenants look for rentals in our area. Include detailed property descriptions, high-quality images, and clear contact information to make it easy for visitors to inquire about your listings.

Third-Party Listing Platforms: Websites like Zillow, Trulia, HotPads, and Zumper are go-to platforms for renters searching for properties. These platforms attract a large audience of prospective tenants actively looking for rentals. Our website feeds directly into these platforms of which many are a paid service for property managers. The direct feed ensures that the platforms have the most up-to-date information about your property and the listing is disseminated to a wide audience.

Social media: We leverage social media platforms such as Facebook, Instagram Google Business Profile and LinkedIn to promote your rental property. We share compelling images, virtual tours, and engaging content to attract potential renters. We also join rental groups or community pages and post about your available unit or respond to other inquiries.

Direct Marketing to Real Estate Agents: We market directly to real estate agents with whom we have developed long-term relationships. They know that we take good care of our properties and our tenants. Real estate agents often have clients who are seeking rental properties, and being top of mind can lead to valuable referrals.

Local MLS: MLS also allows agents to search for rental properties on behalf of their clients. This increases the visibility of your rental listings within the real estate community and can attract high-quality tenants.

For more information, please feel free to request a rental analysis at https://teamworkproperties.com/rentalanalysis/

Home Warranties & Rental Properties

Home warranties can be a useful tool for homeowners to protect against unexpected repair costs for their primary residence. However, they may not be as beneficial for rental properties as it may seem – knowing what your service charge fee is can help manage maintenance expenses, but there are other points to consider:

  1. Limits on coverage: Home warranties typically have specific coverage limitations and exclusions, which may not be suitable for rental properties. For example, many home warranties do not cover appliances or systems that are used for commercial purposes – some warranty companies may consider a rental property as a commercial purpose so read the fine print.
  2. Substandard service: While not always the case, warranty companies generally are paying a lower-than-typical service call fee to the provider. Therefore, only providers that are not filling their calendars with customers that are paying typical fees are the ones signing on to the program. In addition, they are providing the quickest and cheapest “fix” to the immediate problem and not necessarily a larger issue, resulting in multiple service calls and their related fees and tenant dissatisfaction.
  3. Service delays: Warranty companies provide a limited number of providers… this can result in service delays during peak times leading to tenant dissatisfaction. In addition, many warranty companies save costs by requiring the service providers to use their centralized parts distribution center… so a repair that could possibly be done in a single day by a provider using a local parts house, may take a week or more to ship the part from their centralized distribution center – and in some cases, their distribution center may have the part on back order while it is locally available. These delays can result in needing to give the tenant a concession for the delayed repair and in some cases, you may be running afoul of state regulations requiring essential service repairs to be addressed within a specific timeframe.
  4. Administrative oversight: Using a warranty company can mean extra time for the management company… the time to call the warranty company to submit a claim, to call and follow up regarding the assigned vendor, paying the service call fee up front… all of these things are extra administrative effort and outside the management company’s typical procedure for handling maintenance issues and therefore, many management companies will charge an extra administrative fee for handling warranty claims.
  5. Communication: Many warranty companies will always revert to calling the owner and holder of the warranty. While this seems logical to them, it can create massive delays when they should be calling either the property manager or the tenant themselves to schedule repairs or give updates. The service providers are generally not required to give regular updates on the status of the repairs/parts/expected completion which could result in the need for additional calls to the warranty company.
  6. Overall tenant satisfaction: the number one reason that tenants do not renew their lease is dissatisfaction with how maintenance issues are handled. Most homes, regardless of their age, will have some sort of maintenance calls… and while an annoyance, it is not the number of maintenance calls but the ease and efficiency with which they are handled. Using a warranty company can put unnecessary delays and added layers of complication that take away the ease and efficiency for tenants to a point that they do not wish to renew and continue the hassle.

While the idea of the home warranty for rental property may seem like a no-brainer and easy way to manage maintenance expenses, the unknown expenses, delayed larger repairs and turnover costs may far out-weigh the benefit.

Lead based paint and the EPA

Lead-based paint has long been recognized as a serious health hazard, particularly for children and pregnant women. To mitigate the risks associated with lead exposure, the Environmental Protection Agency (EPA) has established strict regulations and oversight measures for landlords, property managers, and contractors involved in leasing, property maintenance and renovation.

EPA Oversight and Regulations: The EPA enforces regulations aimed at preventing lead exposure in residential properties built before 1978, when lead-based paint was commonly used. These regulations, known as the Lead-Based Paint Renovation, Repair, and Painting (RRP) Rule, require individuals and companies performing renovation, repair, and painting projects that disturb lead-based paint to be certified by the EPA and follow specific work practices to minimize lead hazards. The EPA now requires all property management companies managing properties built prior to 1978 to be certified as well.

Fines for Non-Compliance: Non-compliance with EPA regulations regarding lead-based paint can result in significant fines and penalties. Violations may include failure to provide required disclosures to tenants or buyers, performing prohibited renovation work without proper certification, or failing to follow lead-safe work practices during renovations. Fines for violations can range from hundreds to thousands of dollars per day, depending on the severity and duration of the violation.

Disclosure and Brochure Requirements: Landlords and property managers are required by law to provide tenants and potential buyers with specific information about lead-based paint hazards in residential properties. This includes providing a Lead-Based Paint Disclosure form, which informs tenants or buyers about the presence of lead-based paint in the property and any known hazards. Additionally, landlords must provide tenants and buyers with an EPA-approved informational pamphlet, “Protect Your Family from Lead in Your Home,” outlining the risks of lead exposure and steps to take to protect against it.

Certified Remediation Professionals: When dealing with lead-based paint hazards, it’s essential to hire contractors who are certified by the EPA to perform lead-safe work practices. Certified renovators and remediation professionals have undergone specialized training and follow strict protocols to minimize lead exposure during renovation, repair, or painting projects. Hiring certified professionals helps ensure compliance with EPA regulations and protects against potential health risks for occupants and workers.

Requirements for Property Management Companies: Recognizing the importance of lead-based paint safety in rental properties, the EPA has imposed requirements on property management companies as well. Property management companies are now required to have at least one certified renovator on staff to oversee renovation projects and ensure compliance with lead-safe work practices. This requirement underscores the responsibility of property management companies to prioritize the safety and well-being of tenants and occupants in properties under their management.

Compliance with EPA regulations regarding lead-based paint is essential for landlords, property managers, and contractors involved in property maintenance and renovation. Failure to comply with these regulations can result in significant fines and penalties, as well as potential health risks for occupants. By understanding and adhering to EPA requirements, including providing disclosures and hiring certified remediation professionals, property owners and managers can protect their investments and ensure the safety of tenants and occupants in older residential properties.

Ensuring Livable Spaces: The Vital Role of Habitability Standards in Property Management

In the realm of property management, ensuring habitability standards are maintained is a vital role of the property manager. Companies like TeamWork Property Management understand the profound importance of these standards, not just as legal obligations but as an ethical responsibility toward tenants’ well-being.

Why do Habitability Standards Matter?

At the heart of habitability standards lies the commitment to providing safe, comfortable, and healthy living environments for tenants. These standards encompass a spectrum of requirements—from structural integrity to essential services—that collectively safeguard the welfare of those residing within the properties managed by such companies.

TeamWork Property Management’s Commitment

For companies like TeamWork Property Management, adherence to habitability standards isn’t merely a checkbox exercise—it’s ingrained in their ethos. They recognize that meeting these standards isn’t just about compliance; it’s a reflection of their dedication to tenant satisfaction and well-being.

Lead-Based Paint: A Pervasive Concern

One poignant example highlighting the necessity of habitability standards involves the presence of lead-based paint. Properties constructed before 1978 may contain lead-based paint, which poses severe health risks, especially to children. Property management companies must comply with regulations such as the Lead-Based Paint Poisoning Prevention Act to ensure the proper handling and disclosure of lead-based paint hazards. This includes disclosure of the possibility of the presence of lead-based paint as well as following specific renovation protocols.

Legal Compliance and Beyond

Property management companies like TeamWork understand that failure to uphold these standards can lead to legal repercussions. However, their commitment goes beyond legalities; it’s about fostering a culture of care and responsibility.

Tenant Welfare as Top Priority

By prioritizing habitability standards, TeamWork Property Management ensures that tenants enjoy a space where their health and safety are not compromised. A habitable property not only satisfies legal requirements but also nurtures tenant satisfaction and fosters lasting tenant-landlord relationships that are ultimately valuable to the owner.

Habitability standards aren’t just a regulatory burden for property management companies and owner—they are the bedrock of tenant well-being. TeamWork Property Management exemplifies the dedication required to meet and exceed these standards, ensuring that their managed properties offer more than just a roof over one’s head—they offer a secure and comfortable place to call home.

Love is in the Air… for Termites

May is termite swarming season in Charleston, but not all swarming termites are damaging property. Although each swarm can have different characteristics that are all influenced by rain, temperature and sunset, there are a few things to look out for and be aware of – Vic Hainline with Truly Nolen Pest Control outlines what tenants, property owners and property managers should be on the lookout for…

Love is in the Air… for Termites

Charleston in springtime is an amazing place. The flowers are in bloom, temperatures are perfect for the beach, everyone is out enjoying the weather and unfortunately termites begin their annual swarm. There are eight different species of Termite that call the Lowcountry home and two of them are a serious risk for homeowners.

The Eastern Subterranean and Formosan Subterranean Termites live throughout the entire area and are definitely not something for a “do-it-yourselfer” to try and manage. It is essential to find a pest professional that has experience with these difficult pests. Prevention is the key with ongoing inspection and treatment to help keep costly repairs from occurring in the first place.

Signs that renters might see: Termite swarmers, piles of shed wings, changes to trim and boards, pinholes in drywall and mud-like shelter tubes. If you see any of these, please contact your property manager immediately for an inspection.

Termite control is essentially a partnership between the homeowner and pest management professional. The company treats and inspects on a regular basis and the homeowner can assist by eliminating water issues, wood-to-ground contact and notifying their Termite control provider of any changes to construction in or around the home.