Property Management 101

The idea of property management (sometimesmanagement company. Typically property
referred to as 3rd party management) has beenmanagement companies will charge their landlords
around since the dawn of time. But, beforea percentage of the gross rent collected each
property management was a job or career, a titlemonth. This percentage for property
or a company, property management has beenmanagement fees can range from 3 to 10%
an action that many people attended to arounddepending on the property management market.
the land or buildings that they owned themselvesSometimes a flat fee is more appropriate when
or leased from someone else. Propertythe property is a condominium or a type of
management can mean different things tocooperative complex for property management.
different people. For some, property managementSome states might require that property
might mean keeping their own property safe,managers have a property management license
secure and pleasant to the eye. For others,or a real estate license to be able to claim the title
property management could mean payingof property manager or property management
someone else to make sure your property is inbusiness.
tip top shape. Some types of properties that mayA cousin to property management is facility
need property management are; houses, condos,management. Facility management is like property
duplexes, town homes, apartments, shoppingmanagement but the focus is the management of
centers, malls, offices buildings, airports and publicbuildings and services. One definition from a large
transportation buildings, hospitals and many more.facility/property management association says, "A
Property management is very similar to the roleprofession that encompasses multiple disciplines to
of management in any business.ensure functionality of the built environment by
One important role that property managementintegrating people, place, process and technology."
has is to act as the middle person between theAustralians prefer the term: Commercial Services
tenant and the property management landlord.to property management, this term replaces
Property management should provide thefacilities management in some organizations.
property management landlord with a sense ofBesides keeping the property up to date,
security, knowing that everyday needs from thecommercial services can also include duties such
renter can be resolved without involving saidas waste disposal, parking, security, landscaping
property management landlord unnecessarily. Handand more.
and hand with that security, the tenant can beA homeowner may provide his or her own
assured that the property will be maintained toproperty management, but property
some set of standards which can be reviewedmanagement is not limited to the duties of house
with the property management team before ancleaning, lawn care and landscaping, building
agreement is reached. Property management is amaintenance, trash and waste disposal and interior
delicate balance between pleasing the propertyupkeep. Property management can be all of
management landlord and keeping the renterthese, and can be hired out to a professional that
happy as well. The task of property managementcan provide better property management
can prove to be harder than it sounds. Maintainingservices than the homeowner can or would
an open line of communication in propertyprovide themselves. These property management
management and being able to address the needsservices come with a price and if the homeowner
of both property management parties will make ais willing to pay for outside property management,
successful property management business. Otherthe sky is the limit on what they can have
duties for property management but are notmanaged. Some property management
limited to; collecting rent, posting and showingcompanies even manage home owners
vacancies, maintenance issues, evictions, failure toassociations (HOAs). In this instance the property
pay rent issues, harassment, and backgroundmanagement company is the middle person
checks on the application forms. It is verybetween the homeowners and the land developer.
important that a profitable property managementOnce the developer has completed his contracted
staff or team be knowledgeable in the currenttasks, the neighborhood is then turned over to
laws of the city, state and county concerningthe HOA. The property management company
tenant rights vs. landlord rights. Be sure yourmay stay on board for a fee to help the HOA. A
property management team is up to date onlandlord may also provide property management
current property management codes, and otherservices himself or have it hired out to a property
items that will benefit your property managementmanagement company. A large company or
business. Getting caught up in propertycorporation might have internal structures in place
management legal matters is no way to run ato provide property management on site or they
property management business.may choose to hire an outside property
The following is the definition of propertymanagement company to provide the property
managers/property management as posted bymanagement services that they would need on a
Wikipedia on their website. Property managementday to day basis. Both of these operations are a
is a person or firm responsible for the operationreasonable and effective way to tackle the issue
of a real estate property for a fee, when theof property management on a large scale.
owner of the property cannot or is not interestedWith the world of technology growing everyday,
in managing the property themselves. Theit makes perfect sense to have applicable
property manager or the property managementproperty management software and property
company has a primary responsibility to themanagement computer systems that deal with
landlord and a secondary responsibility to theproperty management in place to help with
tenant. Relationships the property manager orproperty management or facility management.
property management team have with theYou can have your home wired and programmed
landlord and with the tenant are crucial in formingto turn the lights on and off when entering a
the expectations of both parties to the leaseroom. Constant temperature and humidity levels
since both parties will seek and expect certaincan be monitored along with major appliance
rights and benefits out of it. Owner's expectationsfunctions. Watering of lawns and security systems
from the property manager/ propertyhas become high tech and available to the
management team are to carry out the owner'severyday homeowner who wants property
instructions, control costs and maximize revenuemanagement. Some passenger vehicles now
to maintain a stabilized cash flow as a return oninclude a "remote" that when programmed can
capital invested, exercise control over the buildingturn the lights on, turn the TV on your favorite
to safeguard the capital invested, provide a dutystation and more, all from the comforts of your
of care through proper maintenance of thecar. Heaven forbid you will have to walk into your
building, to be professional and well informed,dark and quite home. Home builders, architects
enhance the value of the property by makingand engineers saw the potential for using large
improvements that will increase its market value,scale property management ideas in the home.
retain and enhance pride of ownership. TheBeyond the home, large commercial properties,
tenant's expectations from the property managercomputer aided facility management (CAFM) has
property management team are the "quietbeen a natural progression of the marriage
enjoyment" 'assurance of the use and enjoymentbetween technology and facility/ property
of the premises for the intended purposesmanagement. In the late 1980's CAFM evolved to
without interference from the landlord,allow larger properties to manage their property
comforta living environment properly heated,management sites more efficiently. Most often,
cooled and ventilated with as many amenities asCAFM systems track and maintain; floor plans,
possible compatible with the rental level, securityLAN and telecom information, business continuity
and safetyto live or work in a building in whichand safety information, workplace assets,
there are no inherent defects or conditions thatemployee and occupancy data, building and
might be hazardous to health or to property,property information and space characteristics
statusaccommodation and facilities that meetand usage. Being able to supervise the goings on
social-economic and cultural standards for theof your with a property management company in
tenant's and their guest.an efficient and well structured way will help your
Property management can be a very lucrativeproperty management bottom line.
business when handled correctly. PropertyIf you need information about property
management takes an organized, wellmanagement, the internet is a great place to
communicated, and dedicated individual or staff tostart.
be able to pull off a successful property