What Is a Property Manager?

According to the most up-to-date statistics compiled by True List, 44% of landlords prefer to use property managers to oversee their properties. Meanwhile, the 45% who choose to manage their property single-handedly report high stress levels, low profitability, and difficulty keeping good tenants long-term. 

This guide will explain the different types of property managers landlords can work with, what a property manager does, the cost of their services, and whether working with a property manager is right for you. 

What Is a Rental Property Manager?

A property manager is a real estate professional who oversees the daily operations of a rental property on behalf of the owner. Property managers are responsible for rent collection, maintenance and repairs, tenant screening, lease agreements, and other daily tasks. 

What Do Property Managers Do?

Simply put, property managers handle the day-to-day management of a property. However, what a property manager does is highly individualized and can be tailored to the specific needs of each property owner. 

Typically, a property owner can choose from a variety of property management services. Explore our collection of some of the most common tasks owned by property managers.

Marketing & Advertising the Property

Property managers handle all aspects of marketing to maximize property visibility and attract quality tenants. They create targeted advertising campaigns across various platforms, including online rental listings, social media, and even local ads. With professional photos, compelling descriptions, and thorough market research, they position the property to stand out among competitors.

By analyzing market trends and rental pricing, property managers guarantee the property is competitively priced to draw in prospective tenants while maximizing profitability. Additionally, they handle property showings and respond to inquiries, saving owners time and effort.

Marketing a rental property is both an art and a science, and property managers bring industry expertise to showcase the property’s best features and attract the right tenants.

Finding and Screening Tenants

Finding tenants is one thing, but screening them thoroughly is key to securing long-term, reliable renters. Property managers manage the entire tenant acquisition process, from advertising the vacancy to conducting showings.

When potential tenants express interest, property managers screen them by checking credit scores, employment history, rental references, and criminal backgrounds.

This process helps avoid the risk of problematic tenants and sets the stage for a positive landlord-tenant relationship. Property managers use a systematic approach to verify tenant information, making sure that each applicant meets the necessary qualifications.

Property Maintenance, Repairs, and Inspections

Property managers take care of routine maintenance, emergency repairs, and property inspections to keep rentals in excellent condition. This includes scheduling seasonal maintenance, managing ongoing repairs, and coordinating with trusted vendors for professional work.

Regular inspections help identify potential issues early, allowing for timely repairs that prevent costly damage. Property managers often have established relationships with contractors, seeing that repairs are handled efficiently and cost-effectively.

Tenant Management

Tenant management encompasses everything from addressing tenant concerns to handling lease renewals. Property managers serve as the primary point of contact, answering questions, resolving disputes, and maintaining a professional relationship with tenants. This role includes organizing routine property checks, overseeing lease agreements, and managing requests for repairs or modifications.

Effective tenant management helps foster a positive living environment, encouraging tenants to extend their leases and reducing turnover. By staying engaged with tenants, property managers create a sense of community and accountability, ultimately enhancing tenant satisfaction and retention.

Rent Collection

One of the primary responsibilities of a property manager is rent collection. They set up reliable systems for tenants to pay on time, whether through online payment portals, direct deposits, or other methods. Property managers track payments, follow up on late payments, and enforce lease terms related to rent collection.

By establishing clear payment expectations and providing multiple payment options, they streamline the collection process. When tenants miss payments, property managers handle the follow-up, issuing late fees if needed and taking steps to recover missed rent.

This reduces the stress on property owners and provides a consistent income stream, allowing owners to focus on their investment while the property manager handles the day-to-day finances.

Financial Management

Property managers oversee the financial aspects of managing rental properties, providing detailed monthly reports and tracking income and expenses. They handle budgeting, tax reporting, and maintenance costs, guaranteeing that owners have a clear view of the property's financial health.

This role involves managing invoices, paying contractors, and optimizing spending to maximize profitability. By closely monitoring cash flow and creating accurate financial reports, property managers offer valuable insights that help owners make informed decisions.

Financial management services also include preparing annual statements, making tax season more manageable for property owners. Property managers bring expertise in property-related financial management, keeping owners’ finances organized and transparent.

Legal Compliance and Evictions

Navigating the legal complexities of property management requires a solid understanding of tenant laws, building codes, and fair housing regulations.

Property managers work to keep properties in compliance with all local, state, and federal regulations, from health and safety standards to tenant rights. When a tenant fails to meet their lease obligations, property managers handle the eviction process in line with legal requirements. This includes filing the necessary paperwork, representing owners in court, and coordinating with law enforcement if needed.

Benefits of Hiring a Property Manager

Hiring a property manager offers numerous benefits, allowing property owners to enjoy the rewards of their investment without the daily hassles. Property managers handle all tenant interactions, from inquiries to conflict resolution, saving owners time and reducing stress.

They also optimize rental income by setting competitive rental rates based on market analysis and promoting consistent cash flow through timely rent collection. Additionally, property managers use their network of trusted vendors for efficient, cost-effective maintenance and repairs, helping preserve and even enhance property value.

Their expertise in legal compliance shields owners from potential fines and legal issues, offering peace of mind. Property managers also improve tenant retention by responding promptly to tenant needs and maintaining a positive living environment.

With a property manager’s support, owners can focus on growing their portfolios or simply enjoy the passive income generated by a well-managed property.

What Do Property Managers Cost?

Because of the flexibility available when procuring property management services, the costs can also vary widely. As a baseline, property owners should expect to pay a typical residential property management firm between 8-12% of the monthly rental value of the property, plus expenses. 

Property managers typically charge two different ways—a fixed monthly fee or a percentage of the rent. Additionally, many property managers will offer various services depending on a property owner’s needs. 

If you’re a “hands-on” owner looking to delegate only specific tasks and functions to a property manager—such as tenant screening, recruiting, and annual inspection fees—you can expect to hand over only a tiny percentage of your profits in exchange for these basic services. 

But suppose you’re looking to be a “hands-off” property owner delegating most day-to-day tasks and functions to a property manager. In that case, you’ll pay closer to 8-12% of the monthly rental value, as previously mentioned. In exchange, your property manager will take a vacant unit to a tenant-occupied one as soon as possible. They’ll cover marketing, the tenant application process, all necessary maintenance, any late payments, and—fingers crossed it won’t happen to you—evictions if necessary. 

In either situation, property owners will usually pay a small setup fee when getting started. 

5 Types of Rental Property Managers

When first exploring the world of property management, it’s best to be aware that not all property managers are created equal. We’ve divided property managers into these five categories to help you find the type that meets your needs.

#1: The “Friend” Property Manager

This type of property manager is part friend, part business associate.—someone you already know with some experience managing properties. It’s not usually a formalized partnership but more like calling in a favor from a friend. And while this comes with little to no fee upfront, it also usually translates to you not being a top priority and falling to the bottom of their to-do list. We don’t recommend this arrangement to solve your property management needs. 

#2: The Side Hustler

You’ll often find a side hustler within another type of company, but the company isn’t necessarily a property management company. It may be another real estate or investment firm with a small management department. 

This property manager typically manages the properties their firm wants to purchase. Typically they’re not involved with the day-to-day workings of a property and don’t offer hands-on service. Their priority isn’t managing the property but keeping it on the back burner for the day you (the owner) finally decide to sell. 

#3: The One-Man Band

The one-man–or woman–band is a highly motivated, meticulous, hands-on property manager. They work as a team of one, are qualified, and have real property management experience. This type of property manager may have recently left a more prominent firm to cherry-pick their clients and offer more robust and personalized attention to everyone they serve. 

While this property manager can be brilliant, they may have higher pricing. But, the heftier price tag may be worth it for customizable services and creative solutions to save money and improve your property’s worth. 

#4: Small-to-Medium-Sized Property Management Company

The small-to-medium-sized property management company is generally locally or regionally focused. They provide hands-on service with one point of contact (your property manager) who handles your property personally, and they work with a competent admin team to back them up. These team members can carry the torch if the property manager gets sick or needs to take a few personal days. 

Property management companies typically handle 100 to 500+ properties, while individual managers (and their admin teams) tend to manage portfolios of 100 to 200. Plus, if they manage residential properties, they’re an active member of NARPM, a national organization of residential property managers, to consistently hone their skills and stay current on laws and other relevant practices. 

#5: Large or Departmental Property Management Company

Most national brands, averaging 500 to 1000+ properties, fall into this category. Large or departmental property management companies can offer lower pricing for their services as they use their size to increase efficiency. 

Unlike a smaller firm, larger companies will have several property managers who handle many management aspects. While this works well with routine needs and can be one of your most cost-effective options, property owners should understand that managers in this situation can’t spare much individual attention for each property. 

Not sure yet which property management type is best for you? Read more about the different options.

Do You Need a Rental Property Manager?

As a property owner, ask yourself the following questions to determine if you need a property manager:

• Is this your only job?
• Is this the only property you own?
• Are you new to the world of real estate investment?
• Are you having a hard time finding or keeping tenants?

These answers can help you discover if hiring a property manager is the next right step. 

4 Reasons to Hire a Rental Property Manager

There are many reasons to partner with a property manager. Still, we’ll outline the top four for you below. 

#1: Right Rental Rates

Setting a fair and competitive rental rate is key when advertising your property. You’ll want to research what’s typical for the neighborhood and your property type. All Property Management’s Rental Calculator can help you make the best decision. Alternatively, partnering with a property manager makes setting rent—and marketing your property—simple.

#2: Recruit, Attract, Manage Tenants

Finding and keeping great tenants can be one of the most challenging aspects of managing a property. You’ll need a solid system for recruiting quality applicants, a strong application process, and a delightful property for your residents to live in. Luckily, property managers have their own tried and true systems in place, so you won’t have to start from scratch. 

#3: Promote Compliance 

Managing property comes with more than a few rules and regulations. Renting your space to others means a property owner should always comply with local housing regulations and property laws. These laws vary by state, making it tricky, but the right property manager will know exactly how to ensure your property is compliant. 

#4: Maximize Profitability 

Property managers help owners maximize the profitability of their time and money. Whether you want to manage one property efficiently or grow your real estate portfolio, a professional property manager’s expertise is invaluable. 

A property management professional can leverage their expertise to help you find the next right investment and the perfect tenants to match. 

 If you’re ready to partner with a professional property manager, let All Property Management help you start your search for free.