While outsiders may view property management as simply leasing units or collecting rent, experienced investors know that serving tenants well involves a long, time-consuming list of responsibilities.
That said, many investors also understand that they themselves would have a hard time giving 100% to every step of the property management life cycle.
So they put the trust (and work) in the hands of a property manager—a true expert in understanding how each stage contributes to a well-maintained, profitable property with satisfied tenants.
Here’s an in-depth look at how a professional property manager can provide maximum peace of mind, profitability, and ensure happy satisfaction throughout the property management life cycle.
1. Acquisition & Planning
Every successful property management cycle begins before the property is even acquired. From location to property selection to strategy, early stages can make or break the entire endeavor.
Property Selection: If you’re looking to expand your portfolio by acquiring a new rental property, a good property manager can assist in identifying properties that align with your investment goals.
Due Diligence: Property managers can conduct thorough inspections, analyze market trends, and assess the financial feasibility of the property. This includes evaluating the property’s physical condition, location, and potential return on investment.
From an expert himself, Josh Sterling, owner of Epic Property Management says “We’ve seen time and again that a little extra due diligence in the planning phase can save property owners thousands of dollars down the road. Whether it’s identifying hidden repair costs or forecasting market trends, the details matter.”
Financing and Budget Planning: A property manager should be able to help investors explore financing options and outline a preliminary budget, including acquisition costs, potential repairs, and anticipated maintenance.
Strategy Development: Property managers can also work with owners to set clear goals and expectations. This could mean offering an accurate estimate of market rent, suggesting improvements to preserve long-term value, or managing the property in a way that minimizes tenant turnover (the largest expense in any real estate investment).
This foundational planning stage sets the property up for future success.
2. Onboarding & Setup
Once the property is acquired, it’s time to prepare for tenant occupancy.
Legal and Administrative Setup: Property managers can handle all necessary paperwork, including lease agreements, utility setup, and required city inspections.
System Implementation: A good property manager will implement property management software to streamline rent collection, track maintenance requests, and ensure seamless tenant communication. These systems keep everything organized and accessible for both tenants and property owners.
At Epic Property Management, we’ve built our own proprietary custom software, because nothing on the market met our standards for efficiency and detail. Learn more about our custom software here.
Property Preparation: Property managers ensure the property is in optimal condition before listing it. This might include addressing any necessary repairs, conducting necessary maintenance, and handling minor renovations to make the property more attractive to potential tenants.
Learn more: Lookbook: Rental Property Updates that Improve Your Investment
3. Leasing and Marketing
The leasing and marketing phase is all about finding the right tenants to fill your property:
Marketing Strategy: Property managers can support owners with targeted marketing strategies to attract high-quality tenants. This includes online listings, social media advertising, and local advertising, as necessary.
Tenant Screening: A comprehensive screening process helps minimize risks associated with leasing. Property managers typically perform background checks, credit reviews, and reference checks to ensure prospective tenants are reliable.
Learn more: How Many Properties a Property Manager Can Manage
Lease Signing: Property managers handle lease agreements, ensuring all parties understand the terms and that any legal requirements are met. This also includes collecting security deposits and rent payments, handling move-in checklists, and overseeing utility transfers, to name a few.
4. Tenant and Property Management
Once tenants move in, the core property management work begins.
Tenant Relations: Good property managers maintain clear communication with tenants, addressing any concerns quickly and efficiently. This relationship is crucial in maintaining tenant satisfaction and reducing turnover.
Rent Collection: Property managers ensure that rent payments are collected on time and follow up on any late payments, up to and including legal proceedings, if necessary. By providing tenants with multiple payment options and diligently tracking accounts receivable, they streamline the process and minimize late or missed payments.
“Great property management isn’t just about fixing problems; it’s about preventing them in the first place. A smooth operation keeps tenants happy, and happy tenants tend to stick around. It’s as simple as that,” says Nick Wiley, Controller at Epic Property Management.
Maintenance and Repairs: Property managers coordinate routine maintenance and respond promptly to repair requests. A well-maintained property keeps tenants happy and protects the property’s value over time.
Compliance: Property managers make sure the property complies with local laws, safety standards, and inspection requirements. Staying compliant helps avoid potential fines and legal issues that can disrupt cash flow and occupancy.
5. Financial Management and Reporting
For property owners, understanding the financial performance of their property is crucial.
Budgeting: Property managers can help make budgeting more consistent and clear, tracking expenses to maximize profitability. (Pro tip: look for a flat rate property management partner!) They can also help control operational costs, allowing landlords to keep more of their rental income.
Financial Reporting: Property managers can provide monthly, quarterly, or annual financial reports, detailing profits, losses, and budget forecasts. These reports help landlords see exactly where their money is going and how the property is performing financially. Reports should be available in real time, all the time, through an owner portal.
Learn More: What’s a good price to rent ratio?
Cost Control: A knowledgeable property manager can identify ways to reduce costs, such as negotiating with vendors, finding cost-effective maintenance solutions, performing water-bill audits, and more.
Conclusion
The property management life cycle is a comprehensive process that covers every aspect of property ownership, from acquisition to long-term rental to eventual sale. With a good property manager, property owners can enjoy peace of mind knowing that every detail is handled professionally and efficiently. This not only protects the property’s value but also maximizes rental income and keeps tenants satisfied.
Whether you’re new to property ownership or looking for a way to improve your current management approach, investing in professional property management services is a worthwhile choice.
Questions about property management in Michigan? Contact us today.