A (secret) good reason for an owner to hire a property manager

There are a lot of good reasons for an owner to hire a property manager, and many of them are well documented.  Tenant procuring.  Tenant screening.  Lease enforcement.  Reporting.  Maintenance.  The list goes on.Image

But one advantage of having a professional manage a rental is that the property manager knows the rental market.  Why is that important?  Because when market rents go up sharply (like they are doing right now), a property manager knows how and when to raise rents.

If an owner of one rental unit advertises his/her property for rent on, say Craigslist, then there is a better-than-even chance that the property will be under-valued.  The owner won’t be aware of just how strong the market is.  A property that could fetch $1,500 goes out on the market for $1,200 or $1,300.  That difference pays for the manager’s fee AND adds profit.  The owner sees a bump in his/her cash flow AND gets free property management!  Not a bad deal.

We are currently raising rents significantly in the Seattle market.  Demand is far outstripping supply.

The situation works in reverse when rents drop.  A property manager (with the owner’s approval) can offer lower rent to tenants in order to keep them from moving and save on turnover costs.

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