If you’re someone who has been thinking about going into property management, there are several reasons why that could prove to be a really good decision. It’s a relatively easy field to get into, it doesn’t cost a lot of money to start and while having some college education is preferred, a four-year degree is not mandatory. Plus, you need virtually no start-up capital. And here’s the really great part: You can make, on average, around $80,000 annually.
If this is sounding more and more like something that you’d like to do, we have provided you with five tips on how you can successfully start and run a property management business below:
Do you research. Although we have given you the general advantages of the property management business, it’s still a good idea to do some additional research; especially as it relates to the real estate opportunities within your area. You actually might want to set up a meeting with a few real estate agents in order to get their insights on what properties are the most profitable and what areas of town are the most appealing.
Set up a business. In order to have an official business (and be in good standing with the IRS), you are going to need to set up your property management company as a legal entity. Most property management businesses are Limited Liability Companies (LLCs). For more details on LLCs, visit SBA.gov and put “Limited Liability Company” in the search field.
Do some networking. Once you have your business filed, it’s then time to start looking for clients. This will require doing some extensive networking and one of the best ways to start doing that is by joining a few real estate clubs within your area. One website that has a pretty extensive list of these types of clubs throughout the United States is EZ Landlord Forums. Don’t forget to also hire a web designer to create a professional website for you and to set up social media pages on Facebook, Twitter and Linked In so that prospective clients can contact you online too.
Be thorough in your tenant search. The next step to developing your property management business is to start looking for tenants. If you were to consult with a company like Adriatic Restoration Corporation about how to go about that process, one thing that they would probably tell you is that although it’s pretty easy to find tenants (especially if you list your properties on websites like Craigslist), finding responsible ones can require a bit more effort. So, before you begin, write down a list of what you feel would make a qualified tenant for you. As you are comprising it, keep in mind that you must follow the guidelines of the Fair Housing Act. And don’t forget to look at their credit report. That will give you great insight on if you have found a reliable tenant or not.
Be detailed about property management too. One key thing to remember about the property management business is that it’s not just about getting tenants but also taking care of the property too. So also make sure that you cultivate relationships with contractors and maintenance professionals. That way, your properties will remain in good condition, plus it will increase the chances of your tenants resigning their lease—both of which are the indications of running a solid property management business.