You are interested in starting a home business but are not sure which business is right for you. Well, let me tell you about the perfect home business – property management. This is when you help a landlord or several landlords oversee their properties. It could be a single family home or even a small apartment complex. If you know accounting, basic home maintenance, have good connections with the best plumbers and electricians in your area, and have solid people skills then property management may be the perfect home business for you.
Why Property Management?
Property management is the act of managing someone else’s properties for them. Real estate investors will utilize property managers because they lack the time or expertise to effectively manage the properties they own.
Modern property management is not about being the ‘superintendent’ like you see in movies. It is a multi-billion industry, with thousands of property management companies from coast to coast. Property managers not only take care of the physical plant, but they help to collect rents, get leases signed, among other activities. Experienced property managers also have the inside track on building and maintaining the best rental properties in their area.
Low Barriers to Entry
One reason why property management is the perfect home business is the low barrier to entry. You can actually start a property management company for less than buying a car and in most states, you are not required to have an advanced degree. That being said, those property managers who aspire to be professionals will join national associations such as the National Association of Residential Property Managers.
Traits of a Successful Property Manager
While the barriers to entry are low, property management is not for everyone. To be successful you need to be well organized, well connected (especially to plumbers, electricians, etc.), and a people person. You see property management is all about people.
This makes sense as this is home for the tenants. As such, you need to be able to listen, empathize, and most of all, resolve issues. It could be a backed up toilet on Christmas Day or a tenant who is behind on the rent. Either way, the best property managers are very good with people.
A Day in the Life
A typical day in the life of a property manager includes communicating with the landlord, tenants, and contractors. Also, it means reviewing management logs and the preventive maintenance schedule to make sure everything is operating correctly.
In addition, some property managers are tasked with putting together the capital investment budget. Whilst the landlord will have the final say, they will want your input on what needs to be upgraded and why. Property asset management is something you should consider if you are serious about property management. You can receive expert help in managing these sort of tasks and also advice on ways to further growth.
How Much Money Can You Make in a Year?
Entry level property managers average $38,000 per year in the U.S., but this is a national average, so it might be higher where you live. More experienced property managers can make up to $70,000 per year or more.
However, the sky is the limit. The more properties under management the more you can make. For a home-based business, the key is starting small and then building your way up. That being said, property management is the perfect business to run from home and you will get a nice tax break for your home office.
What’s Next?
Getting into property management starts with reaching out to the landlords you know to see who would be interested in having you managing their properties. Whilst prior experience is not necessary having a background in customer service, accounting, and physical plant maintenance can help.
From there you want to get your business registered. This is really simple and in most states you can register your new business online – no need for an attorney. Next, you will need to set up your office. Make sure your business has a dedicated phone line and that you have 24-hour answering. Also, get yourself a cell phone just for your business as this will become your lifeline to the world.
When you first start out it will all be about your existing relationships. But as long as you build up a good reputation other landlords will start reaching out to you. Setting up a property management company is the perfect home business. What are you waiting for? Take the leap and become a property manager today.
