When you own a rental property, it is important to have a property manager who understands your objectives and makes strategic choices to meet those needs. Broadly speaking, there are three major groups of people who own investment properties:
Owners by Circumstance
Life changes. As families grow and change, dispossession of real estate is not always in one’s best interest. It is common, especially in low markets, for people to move to a new home, but choose to rent out their property because the price of selling would not be worth their while. In other cases, work or life could take one to another part of the world for a number of years, and they may choose to rent their property out for the time being.
Whatever the circumstance may be, having a property manager that understands your circumstances is important. Because the rental is likely a shorter term move than if it were a strict investment property, making large capital improvements may not be ideal right away- assuming the property is rental ready
Additionally, putting a tenant into the property on a very long term lease (greater than a year) may not be in your best interest. In Alberta, on a fixed term lease, the tenant has rights until the end of the term. Unlike in other provinces, an owner cannot force a tenant out of a property in order to reoccupy their home prematurely. Having a manager who understands your timeline is imperative.
Owners by Inheritance
As difficult as a family member passing away can be, having to deal with assets and wills adds additional complications. Sometimes, families are left with real estate that needs to be managed. It can be anything from a single condo unit to a whole apartment building, but because family members may not want or be able to, hiring a property manager may be a wise decision.
“Your property manager should not be getting involved in family matters, but should be making life easier during difficult times.”
In these cases, your property manager should be adept enough to consult with decision makers to understand ownership objectives. Because these situations can be turbulent, ensuring that the property is well taken care of and any potential risks are mitigated are primary concerns for any owner. If it is an investment property, your property manager should ensure that money is paid to the right people, per the terms of the trust arrangement, and that decisions are made by those empowered to do so. Your property manager should not be getting involved in family matters, but should be making life easier during difficult times.
Owners by Choice
Owners who buy a property as an investment look primarily at two factors: What does the property rent for and what type of property appreciation will I see when I sell? A good property manager knows that keeping the property occupied is most important. Not only does it minimize costs to the owner, it minimizes risk as between the tenant’s insurance (which a good property manager ensures they have) and them being in the house to notice issues can often catch issues more quickly.
A diligent property manager also looks for ways to enhance the value of your investment property. Not only do they inspect your property to look for issues, they can also advise you on capital improvements that you can do to upgrade the property. And because they manage multiple properties, they may be able to get you a better price on these projects and work with trusted trades that will get the job done right the first time. Not only does this increase the value of your investment, it often increases the asking rent for your home, putting more money in your pockets.
Having a property manager who works for you also optimizing major costs to your property through strong preventative maintenance programs. From ensuring your roof is inspected to ensuring the tenant is maintaining your home properly, they work to ensure you do not have to make capital upgrades too often.
“Retaining tenants is a best practice in property management”
A good property manager will also employ strategies to ensure tenant retention. Keeping a tenant in your home for more than one year decreases your leasing costs, and is also less onerous on your house. If a tenant is in your home and generally comfortable living there, it saves you the cost of doing major upgrades. Additionally, moving furniture and boxes both out and in takes a toll particularly on your carpets and walls. Retaining tenants is a best practice in property management, and something your manager should have strategies for.
Signs Your Property Manager Is Working For you
Every owner has different needs. Your needs may be different from the needs of an owner who has a similar ownership structure. Regardless, your property manager should be aware of your objectives, and work towards achieving them. Starting from an initial consultation with a manager who asks about your objectives, right until the day that you choose to sell the property, it is important that they are on the same page as you.
If you are looking for a manager who will work with you to meet your management objectives, do not hesitate to contact us directly.
