How to Start a Property Management Company: What You Need to Know

how to start a property management companyProperty managers keep track of hundreds, if not thousands, of details on a day to day basis.  Property Managers take care of and manage buildings and other real estate properties for individuals, or group owners.  Their role is to play the middle man that connects the tenants and the property owner, and they also are responsible for the care and maintenance of vacant properties.  Property managers are also responsible for maintaining thousands of records, tenants, rooms, inspections and utilities are just a few of the items that they need to keep track of.  That’s a lot of data and the more properties that you manage, the larger the amount of data that you will be responsible for keeping track of.  Creating an Excel spreadsheet and using the information that you enter to produce reports can be a helpful way of maintaining this data. Learn more about how to create amazing interactive Excel Dashboards that you can use to produce reports and help you manage properties.

Qualities Needed

Since property managers will spend most of their time working with landlords, tenants and contractors you must absolutely be able to communicate honestly and effectively.  You should also be able to identify issues and prioritize them in order form least to greatest, getting the most severe issues resolved as soon as possible and the less severe issues on the calendar to be resolved.  Communicating with multiple parties at once is also necessary.  You may need to take a call from a tenant who is having an issue with their plumbing, call the plumber and explain the issue and book the repairs for a date and time that works for the tenant.  You will want to build a strong working relationship with contractors in your area who can handle maintenance requests.  Try and keep your eyes open and identify improvements that can be made to the properties that may increase their value, as well as ways that may help the owners of the properties cut down on their costs.  Staying calm, cool, and collected while relaying information between multiple people isn’t always easy to do.  Crisis Communication can help you learn tools that you can use to communicate with employees, tenants, contractors and owners assuring them that issues are being handled appropriately and rapidly. Remember that owners have entrusted you with a valuable asset.  They have given you the responsibility of managing their properties, a source of their income, in the hopes that they won’t have to deal with the issues that arise.  As the property manager, it will be your job to put out these figurative (maybe literal) fires from time to time.  You will have to sometimes find creative and effective ways of solving problems without always having to involve the property owner.  After all they have given you this job, in the hopes that they don’t have to deal with these issues.  Learn how to improve your critical thinking and strengthen your problem solving skills by enrolling in Critical Thinking and Problem Solving.

Getting Started

If you have been considering starting a property management, the good news is that it can be done with relatively low start-up costs.  You should only need to have between $2,000 and $10,000 to cover your start up needs.  You can break into the business with no specialized or advanced degree, although having a back ground in real estate would not hurt.  You will also need to have a working knowledge of local, state, and federal housing laws and regulations.  You will need to establish your new business as a legal entity, either as a Limited Liability Corporation (LLC) or an incorporated business (Inc.).  You can hire an attorney to do this for you, or you can do it yourself online.  There are some benefits in choosing to become a corporation.  You will be considered an artificially created legal entity that exists separate and apart from those individuals that created it and carry on its operations.  This will protect you from personal liability for company debts and obligations.  Our Business Incorporation course will help you to learn more about the benefits of being a corporation. Step two, will usually require you to set up the office space that you will use to run your business.  You can always work from home when you initially begin your company if required.  But, at minimum, you will still need to set up a website, an email account, and business cards to operate effectively.  You should also invest in a computer, printer, scanner, and fax machine.  You can use your cell phone if necessary to communicate with clients and contractors, but should also look into setting up a land line and a voicemail account that you will use to receive messages at the office.  As a property manager you will most likely spend quite a bit of time out of the office and at property sites so be sure that you can access your voicemail account on the go if necessary and invest in a cell phone that allows you to send and receive email messages directly on your phone.

Selling Your Services

The best way to begin to build your client base is to network.  Find local real estate agencies, local business organization such as your local Chamber of Commerce and start connecting with agents who may know of property owners who are in need of your services.  Create a few social media accounts that you can use to spread the word about your new business and solicit clients online.  To learn more about how to use social media to launch, position you message and let others know that you’re around, join thousands of others and enroll in our Social Media Marketing for Startups course. Local banks or lenders can also become a great network with whom to establish and build relationships.  They most likely have properties that they are responsible for and may be in the market to outsource the management responsibility to a property management company.  Local contractors may also know landlords that are in the market for someone to take over the day to day management of their property.  The contractors may even be landlords themselves, so it’s always best to ask. Lastly, invest in your brand.  The first place that most people turn to when they are searching for services is the internet.  Consider investing in a paid search campaign to be made aware of property owners that are searching keywords like “Property Management Companies” and “Property Management Firms” online.  Take the information that you gather and reach out to these property owners and offer your services.  The money that you invest in marketing and growing your brand will almost always result in a profit.  You are paying to make others aware of your company and what you can do for them in a way that could be extremely difficult and time consuming without the power of the internet. Being a property manager can have its challenges.  Especially if you aren’t really the type of person that enjoys building relationships, keeping track of details and communicating well with others.  It will take all of these traits (and then some) to be able to run a successful and effective business.  Although it will have its challenges, it can be an extremely rewarding career for the right type of person.