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How Do I Scale My Portfolio?

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How Do I Scale My Portfolio?

28/3/2019

When it comes to rental investments, many landlords start out doing everything themselves.

But while this can work out well in the beginning, especially if your rental is local, eventually you may start to find yourself in over your head. And if you’re planning to add another investment property or two to your portfolio, the amount of work that’s required will exponentially increase as well.

Fortunately, there’s a solution that many landlords and investors today are turning to: enlisting the help of a property manager. A professional property manager can help, not only to make life easier, but also to allow you to scale your portfolio –far more quickly than you’d be able to on your own.

It can enable you to grow your investments without all the stress and frustrations of keeping them constantly filled and maintained hinging directly on you.

If you’re looking to grow your portfolio, then you may be wondering how you go about finding a property management company that’s reputable, professional, and a great fit for your needs. While it might sound like a lot of work –finding and enlisting a property management company, the truth is that it’s something that will pay off significantly in terms of time savings, and the high level of service that you receive.

Let’s take a look at how you can get started finding the right property manager for your rental.

What Does a Property Manager Do?  

First, let’s take a look at what, exactly, a property manager does.

In short, a property manager is responsible for operating or managing your property for you. This can be broadly broken up into two categories, managing tenants and managing the property. Let’s take a look at both now:

  • Managing Tenants

Tenant management covers everything pertaining to tenants.

This includes tasks such as advertising vacancies, creating tenant screening procedures, and vetting potential applicants. It also includes rent collection, fielding tenant requests, enforcing the lease, and when necessary, even handling evictions.  

  • Managing the Property

The other aspect is the physical management of the property itself.

This includes things such as maintenance and repairs, painting before a tenant moves in, ensuring the lawn is being cared for, and your house is being taken care of as well. A house is a physical asset, which means that the repairs and maintenance for it will be ongoing, and having a property manager that keeps up with essential these tasks can be a tremendous help, especially if you are thinking to scale your portfolio or looking to invest outside of your local housing market.

How to Find the Right Property Manager

So how then do you go about finding the right property manager for your rental? A trustworthy manager who collects rent, handles day-to-day issues and responds to various requests from your tenants is worth their weight in gold –and you’ll want to spend some time vetting potential managers to ensure that you hire a qualified professional.

Here are some things that you can do to find a good property manager.

Get Referrals

Perhaps the best way to find a reputable property manager is through referrals. Ask your local real estate agency if they have any property managers they recommend or consider checking with other landlords who have rental properties in the area to see if they have any recommendations for you. Once you have a list of property managers you are considering, you should start doing your research to determine if they are licensed and their reputation holds up.

Ask Questions

Once you start interviewing companies, you’ll want to ask them questions to help give you better insight into how they handle various situations that arise.

Here are a few you might consider:

  • How do they advertise vacant homes?
  • What is their tenant screening procedure like?
  • How many properties do they manage? How many employees do they have?
  • Where do they operate? (If you’re planning to invest in different markets, finding a property management company with branches in those areas can make scaling your portfolio far easier).
  • What is the average vacancy time?
  • What services do they provide?
  • What does their pricing structure look like?
  • How do they handle evictions?

Be sure to jot down your questions ahead of time, adding your own questions to the list to help answer more specific questions you might have.

Check Their Reputation

First, take a look at their reputation. Today, it’s easy enough to head online and check a company’s reputation, to see what people are saying about it. Take a look at your prospective property manager’s reviews and recommendations online. Do some sleuthing and see what you find. Make sure people are sharing good things about them. People are far more likely to share bad experiences than good so if a company’s less than reputable, you should find evidence online.

You’ll also want to make sure your property manager has been certified with a trade organization, such as the National Association of Residential Property Managers (NARPM). Head over to the website, type your property manager’s company in, and see if they come up.

Look at References

You may also want to ask your potential property manager for references as well. Having a few landlord references can help you to ensure that the property manager in question is doing an excellent job. Here are a few questions you might ask:

  • Are they happy with the property manager?
  • Has the property manager kept them updated on important developments with the property?
  • How has the property manager handled repairs and maintenance?
  • Have there been a lot of evictions?
  • Were excessive repairs needed after the evictions?
  • Are the tenants happy?

You might also consider driving past some of the properties that the company is managing to see how they’re being managed. Check the exterior of the property, are things clean? Do they appear to be in working order? A quick drive by could tell you if a property is being cared for or not.

Read Through Their Agreements

Finally, you should take some time to read through the agreements that your property manager will have for you. Their responsibilities should be clearly outlined and by taking the time to look over these responsibilities you will be able to better understand if this company is a good fit. Do they handle the specific areas that you were looking to outsource? Are there extra fees involved for additional services? Make sure you’re clear on their responsibilities and pricing structure before you commit.

While finding a good property manager requires a certain amount of research up front, it’s more than worth the effort required. The right company can save you a tremendous amount of time, money, and hassle down the road. By securing a reputable and professional company early on, you’ll be able to count on them as you scale your portfolio –allowing you to add new investment properties seamlessly, knowing they’ll be managed professionally and profitably.

Are you thinking of scaling your investment portfolio? Be sure to claim your FREE guide: Guidebook: So, You Want to Grow Your Investment Portfolio? This resource will help you to determine if now’s the right time to invest in more properties, and outline the steps that you should take.