5 Passive Income Sources Through Rental Properties

property management

5 Passive Income Sources Through Rental Properties

Property management is the legal authority, control, and maintenance of real property and physical property owned by any person. This would include real property owned by an individual, a company, or an institution. These include apartment complexes, condominiums, mobile homes, agricultural and forestry properties, and manufactured homes. There are also privately owned residential land and development sites. The typical property manager is responsible for all aspects of property management.

The term property manager refers to any person who manages a residential community. The term also includes all those who manage rental properties. Residential property managers may be employed by property management companies and by apartment complex associations. They may also be self-employed. They may belong to professional organizations such as the National Apartment Association, which is an independent organization of property managers and landlords. Property management associations often have their own governing board and officers.

The major duties of property managers include conducting tenant screening, collecting rents, collecting payments, maintaining common areas, repairing damaged portions of the property, collecting overdue rents, and keeping the property safe. Tenants may have varied responsibilities. For instance, they may be responsible for inspecting and assessing the condition of the premises, performing necessary repairs, collecting late payments, and dealing with various problems that arise during the tenancy period. Landlords, on the other hand, are responsible for arranging and conducting leasehold improvements, developing a leasing contract, maintaining records of the property, collecting rent, advertising the property, collecting security deposits, paying the tax and paying the insurance premium. In addition, the landlord has to ensure that the rules and regulations related to repairs and maintenance are strictly followed by his tenants.

One advantage of hiring property management company is that it offers its services at less cost. It may cost a few hundred dollars for hiring a property manager for an entire year. However, hiring a manager for a short-term basis can cost only a few hundred dollars. Moreover, a property management company offers its services at affordable prices as it does not charge additional fees for late payments or for damage control.

If you have a large number of rental properties to manage, hiring a property manager is advisable. Property managers usually work in groups comprising of one property manager for each rental property. A passive income can be generated by hiring property managers to manage your rental properties. They also come with more experience and skills than you and can make critical decisions faster and more efficiently.

A passive income from leasing is a great idea if you want to earn more by leasing your vacant units. However, this system requires effective management and monitoring of the leasing process. You need to regularly inform the tenant about any significant repairs or renovations. This will enable you to avoid late fees and possible fines. If you find some areas in your apartment or condominium that require repair but are not done, do not hesitate to inform your tenant about it so that he/she will not incur further expenses on repairing it.