Overview
Property management is an exciting career that involves bringing rental property owners and tenants together for the mutual benefit of both parties. It is the responsibility of the property management company to handle the day-to-day operations of a rental property as well as facilitate communication between the landlord and tenant. As a property manager, your job responsibilities include collecting rent, maintaining the property, marketing the property, and communicating with tenants and landlords. To open a successful property management company, you need to have business skills and knowledge of local real estate laws.
Research
Before starting a property management company, it is important to research the rental market in your area. Take the time to research rental trends and determine if there is a demand for rental units in your area. Research the competition and understand the services they are offering. Research potential clients and identify their needs and wants. Research the regulations and laws that pertain to rental property in your area. Having a thorough understanding of the rental market and the law can help you set up a successful property management company.
Develop a Plan
Creating a comprehensive business plan for your property management company is essential for success. Include information about the services your company will offer, profile future clients, and develop strategies to acquire business. Outline the marketing plan, projected income, and expenses. Make sure you have enough funds to cover the cost of getting started, such as licensing requirements and marketing expenses.
Licensing
The first step to opening a property management company is obtaining the right licenses and permits. Each state has its own requirements for licensing. Contact your local real estate commission or department of business licensing for more details. You may need to take an exam or training classes in order to qualify for a license. It is also important to carry adequate insurance to protect yourself and your clients.
Marketing
Developing a marketing plan is the best way to attract new business. Include elements such as a website, direct mail campaigns, and real estate networking events in your plan. Advertise in newspapers, apartment guidebooks, online, and other sources. Ask for referrals from existing clients. Word of mouth is also a great way to spread the word about your property management services.
Management Plan
Develop a management plan to ensure that your property management company runs efficiently. Hire competent employees and develop performance standards. Create a policy and procedure manual that outlines how the company operates. Develop strategies to respond to problems such as tenant complaints and maintenance issues. Implement systems to ensure timely rent collection and an efficient tenant screening process.
Manage Finances
Having an efficient financial management system is essential for the success of your property management company. Track all income and expenses. Develop a budget and stick to it. Monitor accounts receivable and utilize collection practices. Outsource services such as bookkeeping and accounting, when necessary. Develop a good relationship with your financial institution and stay organized.
Technology & Software
Utilizing the right technology and software is essential for any property management company. Look for online services that provide tools for tenant management, rent collection, maintenance requests, and financial tracking. Utilizing these services can help you run your property management company more efficiently. Automating services such as rent collection, bill payments, and maintenance request can save time and money.
Tenant Screening
Tenant screening is the process of checking potential tenants’ references and credit. This process helps you ensure that you are renting to reliable tenants who will be able to pay rent on time. Have an established tenant screening process that includes verification of employment, credit check, and eviction history. Develop a tenant application process and have prospective tenants sign a lease agreement.
Customer Service
Providing excellent customer service is essential for any property management company. Your customers, and particularly your tenants, should feel like they are important. Make sure you have a designated person who is responsible for responding to tenant inquiries and complaints in a timely manner. Have a customer service policy that outlines procedures and standards for responding to customer inquiries.
Staying Up to Date
It is important to stay up to date with industry trends and technologies. Attend real estate conferences and workshops to learn more about the industry. Network with other property management companies and stay abreast of new laws and regulations. Utilize social media platforms to stay connected with prospective clients and stay informed on rental trends.
Public Relations
Develop a public relations strategy to build trust and credibility. Promote your services and good work with press releases and networking events. Invite landlords to seminars and workshops that educate them about the benefits of property management services. Utilize online review platforms to further enhance your services and build relationships with existing and prospective clients.
Conclusion
Opening a property management company requires knowledge, dedication, and determination. Having a thorough understanding of local real estate laws, regulations, and rental trends can help you succeed. Develop a sound business plan and utilize the right technology and software for efficiency. Implement a customer service policy and develop a public relations strategy to build trust and credibility. With the right business skills and knowledge, you can become a successful property manager.
