Apartment Property Management
Apartment property management is considered the management of a multi-unit rental property and the residents or tenants who occupy it. These properties can range from small multi-unit buildings to very large complexes that house hundreds of residents. Residential property management is a more widely used term in the industry and could include the management of single-family homes and apartment complexes.
As you can imagine, managing these types of properties can get quite complex and time-consuming compared to managing a single-family home. Many apartment building owners do not have the time, experience, or desire to manage their apartment building on their own. In these cases, it is recommended to hire a qualified property management company that specializes in apartment property management.
Responsibilities of an Apartment Property Manager
Here are some apartment property management responsibilities that might be necessary for anyone managing an apartment building:
- rent collection
- Show available units to potential renters
- Background and credit checks
- Beginning of leases
- Monitoring and processing of lease renewals
- Enforce the rules of a lease
- Dealing with violators of a lease
- Handle an eviction from start to finish
- Mediator when disputes between tenants occur
- utilities
- grounds maintenance
- Security and protection of facilities
- All kinds of maintenance or repair problems you can think of
- Knowledge of landlord/tenant law
- Knowledge of fair housing laws
You are not ready to manage your apartment buildings yourself
The good news is that you can enjoy all the financial benefits of owning this type of property, but you don’t have to deal with the administrative responsibilities of managing it. However, some investors in apartment buildings may decide to take on certain responsibilities themselves. This is a great way to educate yourself, learn from real life experience the ins and outs of the real estate investing business, and of course, save some money. With that said, we strongly encourage you to seek legal advice or counsel if you are unfamiliar with fair housing and landlord/tenant laws in your state and at the federal level.
Hiring an Apartment Property Management Company
There are many management companies in your area that are well-qualified, licensed, and well-versed in city, state, and federal laws regarding landlord-tenant responsibilities. If you’re ready to outsource the management of your apartment building today, we recommend interviewing several management companies. Having an on-site apartment property manager at your apartment complexes is a good idea, especially when you can’t oversee the upkeep and rental business that comes with owning larger properties. Often, on-site apartment property managers who maintain apartments will receive their own apartment as part of their compensation.
Things to Ask Before Hiring an Apartment Property Management Company
Experience: How long in the business. Does the management team have a proven system in place to streamline operations like maintenance repair, timely statements, rent deposits, and communication channels? More companies are giving property owners access to their property account information through a website portal. Here you can see your account statements, any repair items or rental deposits, etc.
Credentials: Does the apartment property management team hold all licenses or certifications required by state law? Unfortunately, each state license requirement is different. We always recommend using a licensed property manager for all of your rental property needs, whether or not the state requires it.
What percentage of your management portfolio are apartment complexes? If 90% of your portfolio is managing single-family homes, you may want to consider hiring one with more experience managing larger multiple units.
Get References: Always ask for an up-to-date list of the properties they manage (make a few drive-by visits), and talk to other owners who are their clients.
We suggest hiring a local real estate attorney to review the Manager/Owner Agreement and the Landlord/Tenant Agreement. And don’t be afraid to request changes if necessary.
And review all the expenses involved in managing your property. Set fees, lease renewal fees, do you impose an increase fee for service/repair calls, etc.? Also find out what their cancellation policy is. Once you think you’ve answered all of your questions, ask this question: “Are there any other charges I should know about that we haven’t discussed that might affect me?”
Invest in apartments for cash flow
Investing in apartment buildings is a great way to build your real estate wealth. These types of properties generally work well for investor cash flow compared to single-family homes where appreciation in value may be more common. When qualifying these types of properties for your portfolio, you’ll want to take into account the passive income that will be generated along with the expense ratio. It’s all about the numbers. A good apartment property management company should be able to help you in your decision making.