(Originally Published August 7th, 2012)
Each investment property owner has a decision to make as soon as they own the property – whether or not to hire a property manager. Northern Colorado is becoming flooded with new investors who are taking advantage of low interest rates, and high affordability. Is it worth it to consider property managers in Northern Colorado? Take a look at the following services and see if it will save you time, money and the headache of owning your investment property.
Good management is key to a good investment. With a property manager overseeing the entire operation of your investment, there is little day-to-day activity you’ll have to perform. This is the biggest benefit to you. Whether it buys you time, or lets you focus your energy on other opportunities, the full service management is your biggest and best advantage. Your manager will handle rental collection and deposits, along with creating dependable leases that protect your investment.
Don’t expect a 3am call from a tenant when using a property manager, that’s what they’re there for. When it comes to maintenance, your property manager will have the systems in place to take care of the need, with no effort required from you. In most cases, you’ll end up paying the cost of repair, but save time coordinating with a trade, or responding to an urgent need. Property managers will typically have in-house handymen or contractors, or hire them on an as needed basis.
Selecting from a pool of the best tenants is one of the major advantages that a property manager in Northern Colorado has compared to an individual owner. Prospects can register with property managers to be notified when new rental opportunities become available. Once the manager has several applicants (in a fast moving rental market) they can select the cream of the crop – the most creditworthy, trustworthy and ones who can commit to the longest lease terms. Qualifying your tenants can be a headache and a financial investment if you go it alone, but managers have the systems in place to quickly and easily perform background and credit checks. They abide by fair housing laws and will never discriminate when choosing tenants. Not only will they have better tenants, but they will get better terms and longer leases, which will positively impact your bottom line.
We like to compare property managers to stock brokers – they all manage and protect your investments. Your property manager’s biggest concern should be how well the investment is performing. Property managers can recommend ways to get the best return on investment, whether its upgrading the property, or adding an additional revenue source like laundry facilities or converting space to something more advantages. Managers gauge the rental market and know when to raise rents based on vacancy rates. The best of the best managers are excellent financial reporters as well. They will provide you all the income and expense reports necessary for taxes and accounting.
Keep in mind there is a cost to utilizing your property managers services. In Northern Colorado, we’ve seen between 8% to 12% of the gross rents per month as payment for management. This is a very small price to pay for legal, financial, and physical protection of your investment. We typically recommend utilizing a property manager. If you’re interested in investing and seeking financial freedom, the NoCo New Home Team will be happy to show you the homes in Northern Colorado that will give you your highest return on investment, and easily recommend you to a property manager to handle everything after your purchase.
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