REAL ESTATE MANAGEMENT

MANAGING OUR TIME TOGETHER

February 2020
Table of Contents

Section 1 Introduction to Real Estate Property Management

Section 2 Strategies for Property Management

Section 3 Jobs for Property Managers

Section 4 How to Manage a Property

 Introduction to Real Estate
1 Property Management
Introduction to Real Estate Property Management

§ Real estate property management is the supervising of apartment, housing units, or other types of
residential, commercial, or industrial properties. Usually the property manager manages a property
that is owned by a separate party. The owner controls the property managers actions in order to
preserve or improve the property. The property manager earns income from the owner. Essentially,
the property manager acts on behalf of the property owner.

§ A property manager makes it easier for the property owner, as the owner no longer must stay
stationary in order to makes sure that the value of the property is not deteriorating. Allowing the
property owner to invest in other properties at the same time.

§ The main purpose of real estate property management is to make sure that the value of the property
doesn't lower, as the owner can lose money if they decide to resell the property.
Reasons to Hiring Real Estate Property Firms

• Property owners hire real estate property firms for many reasons. As mentioned before, property
owners may have many rental properties to manage, but lack the time or skill set to do so. Instead,
they hire a property manager to deal with tenants and maintain the value of the property. Some
property owners may lack an interest in property management. They might only be interested in
investing in real properties and earning a stable cash-flow from it. A real estate property manager
does most of the extra work that property owners may not have the time to do.

• Property owners who participate in affordable housing programs may hire real estate property firms.
The reason for this is because many of these owners lack the knowledge of federal guidelines or the
skill set to manage a property. These owners invest in real estate property firms, just to take the
benefits of affordable housing programs.
Property Management Licensing Requirements

§ Property management licensing requirements vary among county and state. Most places
require property managers/property management companies to be licensed by the real estate board.
Having a real estate broker's license allows the property manager to list rental properties in the
multiple listing service and to market the properties by standard real estate methods. Having a
license also allows the property management company to lock on a property, so that licensed agents
can show the property.
Summary of Real Estate Property Management

§ In real estate property management, some brokers may also be property managers. A broker in a
town may provide buyer and seller services, and property management services. So, the real estate
broker also leases vacation rentals. Property managers help owners create budgets advertise, qualify
and manage tenants, collect the cash-flow from the rent, follow real estate board laws and maintain
and possibly improve the value of the property. Interior/Exterior cleaning, construction, and
maintenance are all managed by the real estate property manager. The property owner can pay the
property manager directly, or share equity in the company.
2 Strategies for Property Managers
Strategies for Property Managers

Strategies Explanation of Strategy

1. Do it yourself § This strategy of management takes the most amount of work. You are the
management property manager, meaning that you maintain everything yourself.

2. Half Outsource § This strategy of management allows you to manage areas that you are
comfortable with and outsource the areas that you have no expertise in at all.

3. Outsource § This strategy of management allows you to do no work. You only invest in the
management property.
Do it Yourself Management

§ Pro:
§ Control: By taking the “do it yourself management” strategy, you have full control over what
you want to do with the property.
§ Awareness: If the property experiences any problems, you will be notified immediately. You are
aware of all the problems in the property.

§ Con:
§ Workload: This may be overwhelming, as you must take care of everything.
§ Achieve Less: If you are the property manager for a property, you won’t have the time to invest
in other properties.
Half Outsource Management

§ Pro:
§ Less Work: By using this strategy of management, you can focus on the things that you want to
do. This frees up time and is less overwhelming.
§ Experts: Unlike do it yourself management, you have experts, helping you achieve some of the
work.

§ Con:
§ Rely too much on others: You are putting a lot of trust in people that may not have your best
interest in mind.
Outsource Management

§ Pro:
§ No work: You hire people to manage everything in the property for you. You don't have to deal
with tenants at three in the morning. You have time to invest in other properties.

§ Con:
§ Costly: Property Managers can cost you thousands of dollars a year.
§ Risky: You are putting your entire property in the hands of managers.
3 Jobs for Property Managers
 Managing Tenants

§ Rent Collection: Setting due dates, collecting rent every month, and dealing with unpaid rent.

§ Lease Agreement: Verifying legal terms required by state law. Making sure that lease is following the
most recent version of the law. Managing start and end date for lease for all tenants.

§ Tenant Screening: Advertising, setting appointments, reading through applications, determining

good/bad tenants.

§ Move-In: Singing lease agreements, rules, requirements and regulations. Collecting security deposit.
Making sure each unit is in good condition.

§ Move-Out: Making sure lease term is over. Checking the unit to make sure that it is in good
condition. Finding possible tenants to fill the vacant spot.

§ Tenant Complaints: Listening and acting upon complaints filed by tenants.

§ Repair Requests: Listening and acting upon requests filed by tenants.

§ Evictions: Managing tenants, filing eviction with the court, court speeches.
Maintianance and insecptions

Maintenance: Cutting grass and trees, picking up leaves and garbage, taking out the garbage, managing
heat, water, electricity, and air conditioning. Fixing any leaks(roof/plumbing), cracked windows, broken
doors/locks.

Inspections: Inspections from town, lender and insurance company. Make sure you are following any
safety and health codes. The lender and insurance company make sure the property is upholding its
original value.
Finances

§ Rent Payments: Collecting rent every month.

§ Mortgage Payments: What you pay on your mortgage every month.

§ Insurance: Paying to insure the property. In case of disasters.

§ Utilities: If tenants are not responsible for paying for utilities, you must figure out how much water,
gas, and electric bills are each month.

§ Taxes: Figuring out your yearly property taxes.

§ Fees/Fines: Fees you must pay for property inspections if needed.

4 How to Manage a Property
How to manage a property

§ Get to know your home

§ Plan to reinvest in your home

§ Create a financial plan

§ Work with knowledgeable real estate agent

§ Find good property managers

§ Provide instructions to guests

§ Ensure proper levels of inventory

How to manage a property the right way

§ Be strategic about personal use

§ Imagine it as a hospitality business

§ Be realistic about pricing

§ Good relationship with housekeeping team

§ Build redundancy into inspections

§ Have a good marketing plan

§ Take maintenance seriously

§ Dynamic Pricing/Revenue Management