Property Management
Property management is the process involved in the upkeep, maintenance, security, contracts and admin related to real estate. This can be for residential, commercial, industrial or special use spaces.
Property managers can be the landlords or owners of a property themselves. Or they can be independent third parties who property owners pay to manage all this stuff for them. They can work solo, or as a part of a property management firm.
Property management is related to, but also quite different from, property development. Developers build or refurbish properties. Then in come the managers, who take over the administration and running of the space once it is fit for purpose.
What do Property Managers Do?
In a typical job description, a property manager's day-to-day tasks could include the following:
- Finding and talking to potential tenants
- Organising leases, contracts, taxes and other administration
- Taking and passing on rent
- Physical property maintenance such as repairs, redecoration
- Ensuring that (between themselves and any tenants) the property is upkept to legal standards
- Knowing and understanding national and local property laws, legislation and codes
Defining exactly which of these things are the responsibility of the tenant and the property manager can occasionally be complicated.
Then there's also the distinction between community managers and property managers. If you live in a rental apartment block, for example. In this case the person responsible for the upkeep of the communal areas in your apartments may not be the same person that you call if something breaks in your property.
As you can tell - property management is not a simple job. However, property managers also (generally) make good money.
How Much do Property Managers Make?
Self-employed property managers, such as first-time landlords going DIY, may start out making relatively modest sums. However there's a lot of scope for bigger incomes the more properties you manage.
Joining a property management firm is also a way to a higher salary, especially when going up the hierarchy.
The average property manager salary in the US varies between $40,000 and $60,000 a year according to various estimates.
Types of Property Management
There are four main types of real estate usage in the US. All of which will require some kind of property management.
- Residential property - i.e. spaces to be lived in such as apartments, family houses or condos
- Commercial property such as hotels, retail spaces, services and rentable workspaces like art studios or co-working spaces
- Industrial properties like factories and warehouses
- Special cases - including public interest properties like schools, performance spaces, hospitals and religious sites
Interestingly, a property management company may or may not be responsible for managing their own offices! In some cases, startup property management firms set up in a rented office - managed by someone else.
Who Needs Third Party Property Management?
For a first-time or single property landlord, renting out a property near to their own residence - they might not need a manager.
However when a landlord owns multiple properties, things can get busy. A property manager would be a good idea in this case. Other types of property owners who might benefit from hiring a management company include:
- Landlords who are retired or otherwise unable or unwilling to do the management work themselves
- Social or affordable housing landlords, who need to understand complex regulations
- Landowning companies like investment firms who own hundreds or thousands of commercial properties like offices
- People who own one or more holiday homes, that they want to rent out while not in use
Who Can Do It?
If you own your own property, you can manage it for yourself with no extra legal requirements. If you plan on renting it out, you will have to set it up and keep it at a certain legal standard depending on the purpose.
If you plan on becoming a third-party property manager, or setting up a company, you might not need some extra steps first. Most US states will need you to acquire a licence to become an accredited property manager.
The Final Deal
So, that's our guide to the property management essentials. The who, the what, they why, the where and the how of managing property. Easy!
Check out our other pages for more information on the details of this important but often underappreciated employment sector.