Real Estate Professionals
Understanding Property Management
Below is a large amount of information about property management. Please take some time to review the information, and then feel free to contact us with any questions you might have.
The Initial Call from the Landlord
A company such as ours takes calls weekly, if not daily, from property owners who are searching for a property manager. These calls may be from individuals that have recently become investors, or from experienced Landlords with many years of rental property experience. These calls can cover a wide variety of topics, from the fees we charge for leasing and management, to our philosophies on property management and dealing with tenants, vendors and Landlords.
Frequently Asked Questions
Here are a few of the most frequently asked questions and the answers we provide to those questions.
Who Do You Work For? Excellent question! The Texas Real Estate Commission and Texas Law requires that every REALTOR® disclose Information About Brokerage Services to prospective clients during our first conversation of substance or our first face to face meeting. Basically, the information explains the fiduciary obligations the REALTOR® has to a client or a customer. A client is someone that has signed a representation agreement with the Broker, and the Broker or REALTOR® is then working in the best interests of the client. If there is no representation agreement, the prospect is a Customer, but is still to be treated honestly by the REALTOR® or Broker.
How much will you charge me for leasing and property management services? Well, this is a question that is not easily answered. We use a basic management agreement template, but actual terms can vary from one property to another, depending on the burden of work experience tells us to expect. As a rule our leasing fees equate to approximately one month's rent. For example, if your property leases for $750 per month, the fee for leasing the property (finding you the most qualified tenant for the property) may be $750. This may seem to be excessive, but that $750 goes in several directions. It pays us. It pays another REALTOR® (in most cases) and his/her brokerage for presenting the qualified applicants to us, and it pays for any advertising we feel may be required. We must make it attractive to a professional leasing person to show the property to prospective applicants.
As far as the cost of managing your investment property, we charge a percentage of a months rent, again depending on the expected degree of difficulty we anticipate. We are not in a position to generalize about such charges, since you might find this misleading: thus we ask that you contact us so that we might exchange information and determine what charges might be most appropriate.
The Next Stage of the Process
After careful consideration, you have decided to hire 1431 Property Management LLC to represent you as Property Managers and leasing agents for your investment property. This is generally what follows: almost everything in the process can be handled by e-mail. We will gather information from you (including Tax ID numbers or Social Security Numbers so the taxable income can be reported to the government), and prepare the Leasing and Property Management Agreement. The agreement will have been completed according to the specific terms and conditions we have mutually agreed upon, and we will most likely e-mail that agreement to you. We will also provide you with a form called the Owner's Notice Concerning Condition of Property which is basically the landlord's disclosure of the property condition. If the property was built prior to 1978, you will also be provided with a Lead Based Paint Addendum. This is basically a disclosure that the property was built before Lead-Based paint was removed from the market, and we will provide the new tenant with valuable information about protecting their family from Lead-Based paint.
Once we have received the signed representation agreements and access to the property, we will make another visit to the property and complete our own inventory of the property, using the Property Managers Inventory and Condition Report. During that visit to the property, if the property is vacant, we will take that opportunity to photo the property from various angles, and put the lease signs and lockbox on the property.
Advertising the property is an art in and of itself! Traditionally, newspaper advertising was the most productive means we had to market the property, but times have changed! Honestly, newspaper advertising is probably the most expensive and least effective way we have to market your investment properties for lease. Prospective tenants are really incredibly tech savvy, and they can log-on to our websites and see exterior and interior photos of your property. They can also log-on to a number of other search engines to locate their ideal property. All of our listed properties get plenty of internet exposure. We will also list the property on Craigs List which is a free service and community driven.
All of this if good, but in many cases the most effective way we have of advertising your property for lease is the sign we will put in the front yard. Old habits never die, and there is no better way for a prospective tenant to find the home of their dreams, than by driving through the neighborhoods where they want to live!