It is also the management of personal property, equipment, tooling, and physical capital assets that are acquired and used to build, repair, and maintain end item deliverables. Property management involves the processes, systems, and manpower required to manage the life cycle of all acquired property as defined above including acquisition, control, accountability, responsibility, maintenance, utilization, and disposition.
For example, an owner of a single family may engage the services of a property management company. The company will then advertise the rental property, handle tenant inquiries, screen applicants, select suitable candidates, draw up a lease agreement, conduct a move in inspection, move the tenant(s) into the property and collect rental income. The company will then coordinate any maintenance issues, supply the owner(s) with financial statements and any relevant information regarding the property etc.
There are many facets to this profession, including managing the accounts and finances of the real estate properties, and participating in or initiating litigation with tenants, contractors and insurance agencies. Litigation is at times considered a separate function, set aside for trained attorneys.
Although a person will be responsible for this in his/her job description, there may be an attorney working under a property manager. Special attention is given to landlord/tenant law and most commonly evictions, non-payment, harassment, reduction of pre-arranged services, and public nuisance are legal subjects that gain the most amount of attention from property managers. Therefore, it is a necessity that a property manager be current with applicable municipal, county, state and Federal Fair Housing laws and practices.
Property management licensing requirements vary among the states. Most states require property management companies to be licensed by the local real estate board. Holding a real estate broker’s license allows property managers to list rental properties in the multiple listing service (MLS) and to market the properties by standard real estate marketing methods. Holding a real estate broker’s license also allows the property management company to place a real estate board lockbox on a property’s door so that other licensed agents can show the property. States such as Delaware, Florida, and Illinois require property management companies that provide on-site management services to condominium communities to hold community management licenses.
Reasons for Hiring
Property owners hire property management firms for various reasons. Some owners may have many rental properties in their portfolios but lack the time or expertise to maintain the properties and deal with tenants. Some owners only have an interest in owning rental properties and earning profits from them. When this is the case, they hire professional property managers. Absentee landlords also make use of property management services.
Property owners who participate in affordable housing programs sometimes make use of property management services. This is because participating in such programs requires knowledge of federal guidelines that some owners do not have, even though they wish to reap the benefits of affordable housing programs.
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