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Property Management Companies & Why you need one

Taken the plunge and jumped into the real estate property game?  Good for you!  But now what? Do you need a Property Management company to help you out? Consider the following to see if it’s the best choice for you

Rental Rates – A good property management company will conduct a thorough market evaluation to determine a good rental price to set, helping to maximize your monthly income and maintain a low vacancy rate.

Collecting & depositing monthly rental payments on time. Seems so easy, but you know that securing payments from clients can be difficult and certainly time-consuming. Property Management Companies have systems in place to be effective in collecting rent, something crucial to maintaining your cash flow.

Marketing and Advertising. An effective property management company will have the experience in how to market your property effectively and craft compelling advertising. All the goal of filling your properties quickly and avoiding long vacancies.

Tenants Experienced property managers are experts at finding you good tenants taking care of very critical details like background checks, credit reports, verifying employment and references.

Managing your tenants. Once you’ve gotten your tenants in place, the work really just begins. There are emergency situations, routine inspections and really any other potential situation that arises that requires attention. All handled by the property management company to do the heavy lifting.

Vendor relationships. Your property management team will have relationships in place with many individuals, workers, tradesmen, vendors, contractors, etc. For most independent landlords, the amount of time they would need to handle the work and negotiations as well as oversee the projects is far more than the piece of mind they get with hiring a property management company to navigate these situations and relationships.

Housing regulations When you rent and maintain your rental property, there are many applicable laws and regulations that must be followed. There are local, state and federal regulations as well as fair housing regulations. Your property manager will help keep your property in compliance and up to date with the regulations, thereby helping you avoid the possibility of a lawsuit.

Geography  Hiring a property management company allows you to invest without having to live in a particular place, taking advantage of investment deals, no matter where they are.

Maximize With a property manager in place, you can identify and take advantage of other investment opportunities because they will be running the day-to-day aspects of your income property.

Property management, while rewarding, requires a lot of commitment in both time and in effort. If you’ve got the time and you’re very handy, then you might be just fine taking it on yourself.   But in many cases that’s simply not practical, particularly if you hope to expand.   That’s where a Property Management Company can be incredibly useful, managing the tasks that are critical to a successful investment rental property.  Check out more information about property management options our site.

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Real Estate Investing … Are you ready to take the plunge?

Real Estate InvestmentI own a Minnesota based boutique-style Real Estate Brokerage specialized in Rental Property Sales, Leasing, and Management. My hand-on approach is to help my clients build and maintain a nest for their investments. Our process is simple – the “Ideal Approach” and it represents the five money maker’s of rental property.  Through working with me, my clients can gain the knowledge they need to take the plunge into real estate investing and create a nest egg of passive income.

Income – Depreciation – Equity – Appreciation – Leverage

But let’s drill down a bit further … before you are ready to take that next step, you have some things to consider about your potential investment/purchase.

There are obvious benefits to be sure. Steady Income comes to mind as a first. It’s passive income, which is a huge incentive to get you going in the real estate marketplace towards that first investment property purchase. If chosen wisely, your income from this investment will be around for a long time and help towards retirement savings. Once you get the hang of it, it becomes easier to look for multiple properties, increasing your cash flow and diversifying your portfolio. And remember, you can hire a property management company to assist should the workload and time needed become difficult for you to manage.

As with most real estate investing, there’s the benefit of long-term financial security. Although there’s never a guarantee, typically the property appreciates in value over time. Land and buildings are assets that do appreciate, so with careful research on the property & the location, you’re likely to see huge benefits from this investment.

Tax Benefits … Need I say more? There are obvious tax exemptions for investors who own a rental property. This is one of the top reasons many people choose to invest in the first place. Just a few of the examples of the benefits – There’s no self-employment tax on rental income. Often the government offers tax breaks for things like property depreciation, maintenance repairs, property taxes, insures and more. Lower tax rates are also given to real estate investors for their long term investments.

Mortgage Payments covered – check! Yes, another benefit is that your tenants’ rent is typically more than enough each month to cover not only your expenses but also you mortgage payments. A very good reason to keep your tenants happy and avoid negativity that could lead to vacancy.

Real Estate Appreciation – Investors know that over time, the value of the investment will increase including the appreciation of capital assets (aka land). This is the long game for most investors.

Inflation – Believe it or not, this is a good thing for investors. As the cost of living increases so does their cash flow. And your rental property and property values will increase significantly.

I’m my own boss – One of the best parts of investing in real estate is that you have autonomy and control over your strategies. You’ll be making choices over which properties to invest in, which tenants will live there, who maintains/manages the property and how much rental income to charge per month. You’re your own “Decision Maker.”

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