Property Management

Property management involves overseeing residential, commercial, or industrial real estate every day. A property manager, who is hired by someone else, takes care of things like repairs, maintenance, security, and general upkeep of buildings. They usually work for the owners of places like apartment buildings, condominiums, private neighborhoods, shopping centers, and industrial areas.

Their main jobs are to handle the day-to-day tasks given by the owners and to keep the properties in good shape while also making money from them.

Understanding Property Management

Property developers usually want to move to the next project once they finish one. Even if they still own the property, they like to give the daily tasks to another company.

Here are the main jobs of a property manager:

1. Checking potential tenants
2. Making, signing, and renewing leases for property owners
3. Collecting rent
4. Taking care of properties, like gardening and clearing snow
5. Organizing repairs for properties when needed
6. Planning and sticking to budgets for property upkeep
7. Knowing state and national rules for landlords and tenants
8. Advertising properties
9. Supervising other workers
10. Dealing with taxes

Companies must follow state and local rules for landlords and tenants.

Property owners give property managers a fee or a part of the rent earned while they manage the property.

Types of Property Management

Property managers come in different types, just like properties do. Some companies focus on managing a specific type of property, while others handle various kinds of properties. There’s a wide variety of property types that can be managed.

Residential Property Management

Residential property managers are usually hired to take care of rental properties and oversee the rental process. They can be hired to manage:

1. Single-family homes
2. Vacation rentals
3. Multifamily homes
4. Townhouses
5. Condominiums
6. Apartments
7. Manufactured homes
8. Real estate-owned (REO) properties

Commercial Property Management

Commercial property owners have distinct needs compared to residential property owners. Commercial property management can involve:

1. Public accommodations such as hotels
2. Retail properties like malls, restaurants, and gas stations
3. Office properties such as real estate brokerages or doctors’ offices
4. Co-working spaces where professionals rent workspace by the day or hour

Industrial Property Management

Industrial properties that can benefit from management include:

1. Heavy manufacturing facilities like automotive plants and steel mills
2. Light manufacturing factories such as food packaging plants
3. Warehouses
4. Distribution facilities

Special-Purpose Property Management

Additionally, there are various types of properties that don’t fit precisely into the categories mentioned earlier but still require management. These include:

1. Theaters
2. Sports arenas
3. Resorts
4. Senior care facilities
5. Schools and universities
6. Places of worship

Who Needs a Property Manager?

Different property owners find property management services useful for various reasons. Landlords, for instance, hire property management companies for several purposes. Some own multiple rental properties but lack the time or know-how to maintain them and handle tenants. Others simply want to own rental properties for profit and hire professionals to manage them. Absentee landlords, who own properties but don’t live nearby, also rely on property managers. There are even property management firms that cater to individual landlords who rent out just one property, like a vacation home.

Property owners involved in affordable housing programs often use property management services because their rental properties must follow complicated federal rules that need specialized knowledge. Some real estate brokers also double as property managers. For instance, a broker in a resort area might offer services like buying and selling properties along with managing them. In such cases, the broker handles everything from listing and showing properties to leasing and maintaining vacation rentals for various property owners.

Special Property Management Considerations

Licensing rules for property management vary from state to state. Most states mandate that property management companies obtain licenses from the local real estate board. Therefore, property owners need to ensure that the firms they hire are properly licensed.

In Florida, for example, property managers must hold real estate broker’s licenses to operate legally in the state. This is because some of their tasks are classified as real estate activities. Having a real estate broker’s license enables property managers to list rental properties in the multiple listing service (MLS) and market them using standard real estate methods. Additionally, with a broker’s license, property management companies can place real estate board lockboxes on property doors for other licensed agents to show the property.

In Florida, property managers who handle rentals or leases and receive commissions for their services must also hold a broker’s license. However, property managers who oversee properties they own in the state are not required to have a license.

In contrast, property managers in Massachusetts do not need a broker’s license. This is because certain tasks considered real estate activities, like listing and leasing properties, may be secondary to the primary duties performed by the property manager.

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