Thinking about starting a property management company or taking on a career in the industry? Before you dive headfirst into property management, you need to make sure you have the right skills and knowledge. Being in property management may seem simple to those with little experience looking in from the outside, but it is in fact very complex.
If you’re already in property management and are looking to grow your business or make the most of the latest leasing technology, take a look at these helpful resources:
Below we’ll take an in-depth look at what a day in the life of a property manager looks like, what is required to start a property management company, and how you can set yourself up for success.
What Is Property Management?
Property Management is the oversight of one or multiple residential, student housing, community associations, or commercial properties. The owner and manager can be the same individual, or the properties can be run by a property management company if the real estate investor doesn’t have the time or experience to manage the properties himself.
What Do Property Managers Do?
Property managers take care of and manage buildings and other real estate properties for individuals or groups of owners. They are classic middle managers that connect owners to renters and also take care of vacant rental properties. Responsibilities of property managers include marketing vacant units, showing the properties, collecting applications, getting leases signed, collecting rent, overseeing maintenance on the properties, conducting move-in/out inspections, and more.
One attraction of property management as a new business venture is that the barrier to entry is low. Startup costs are affordable ($2,000-$10,000), no advanced degrees are required, and you can get into the business with little experience. Having a background in real estate is helpful, but not essential.
Some of the most important traits of a great property manager are the ability to be well organized, to connect and empathize with people, and to be responsive to many types of urgent situations. You’ll have to interact with residents and prospects on a regular basis, so it’s essential you have strong customer service skills.
You will also need to have the skills to form positive working relationships with vendors, as you’ll need a network of contractors to handle maintenance issues, as well as special requests. And ideally, you’ll be proactive in identifying ways for property owners to make valuable enhancements to their properties as well as to save money where appropriate.
Most of your daily tasks will involve working with landlords, residents, and contractors, so your ability to communicate and deal honestly with them is most crucial. Property managers must also be detail oriented, dependable, independent, and consistent. Owners are outsourcing this task so they don’t have to be involved. The successful property manager is a creative and effective problem solver. Finally, you need to have a working knowledge of local, state, and federal housing laws and regulations, as well as a basic understanding of finances.
What Do Community Association Managers Do?
Like property managers, community association managers oversee properties, but these properties are inhabited by homeowners. The homeowners may or may not live in the units they own, and the entire community is run by those homeowners who are elected to the board of the association. The board members are volunteering their time to ensure that their community is the best place for the residents to live in.
If you’re an established community association manager, then take a look at these articles to further enhance your association:
Back to those who are starting out — property managers can help community associations by processing the monthly homeowners’ dues payments, tracking violations, coordinating maintenance as needed, and communicating with the board and homeowners in addition to other tasks. While there are self-run community associations, a property manager can be a tremendous asset to take busy work off of the board members and streamline communication to help the association run smoothly.
How Much Do Property Managers Make?
According to recent reports from payscale.com, the national average salary for property managers is around $50,161/year for entry level to $75,000/year for more experienced managers.
How to Become a Property Manager
Once you’ve decided you want to get into the property management game, it’s easy. Many states require you have a real estate license, so check to see if your state is one of them. Like with any new industry you’re entering, you’ll have to start out as an entry-level employee and work your way up. Over the years, you’ll learn the ins and outs of management and make some valuable connections, and eventually, you could branch out and focus on starting a property management company of your own.
Do I Need a Property Manager License?
Although many states require a real estate license or other certification, most don’t require an advanced degree. A real estate license or practical experience in the real estate industry is helpful, but not always required. However, having a real estate or property management certification can still be beneficial if you intend to start working for an established property management firm.
How To Get Property Management Certification
There are a number of programs in the U.S. that offer courses for licensed real estate agents and brokers to get certification in property management. The courses teach you how to establish and build a property management business, find clients, and remain compliant. Here are a few of the most popular courses currently available:
How to Start a Property Management Company
Starting a property management company is similar to setting up any other type of commercial enterprise. You need to establish a legal entity – normally a Limited Liability Corporation (LLC) or an incorporated business (Inc.). You can hire an attorney or you can do it yourself online.
It’s also a good idea to draft a business plan. Having a solid business plan can help you to make better decisions, stay focused, and to take a methodical approach when starting your company. When creating your business plan, consider your short- and long-term goals. Where do you want your business to be in 1,3, and 5 years? What kinds of services do you want to provide to your residents? How do you want to structure your team? How do you plan to handle maintenance? When you’re finished, you’ll have a comprehensive roadmap to successfully run your property management business.
How to Market a Property Management Company & Get Clients
Networking is an effective way to begin building your client base. Find local real estate clubs and connect with local business organizations like the Chamber of Commerce.
Reach out to real estate agents who are constantly in touch with landlords. Local lending institutions are also good sources of leads. They may have properties for which they are responsible and outsource the property management function. Local contractors also interface with property owners regularly, so seek them out for possible introductions.
Finally, advertise your services using both on and offline channels, and be sure to run a paid search campaign to capture property owners searching for property management companies in your area.
How to Run a Property Management Business
Once you’re all set up and have some properties to manage, it’s in your best interest to employ a property management software to keep you efficient and organized to successfully run your business. Daily tasks can be streamlined, so you can focus next on growing your business and making more money.
And while your property management company may start out small, be sure to look for a software solution that scales as your business grows. By doing so, years from now when your business is booming, you will be comforted in knowing that you aren’t going to outgrow your software.
Once you manage 50 or more units, consider implementing an all-in-one property management solution, like AppFolio that gives you the ability to run your business, stay connected, and communicate with customers — from anywhere.
Being a property manager can be challenging, but for the right type of individual, it can be an extremely rewarding career.