What Is a Property Manager?
A property manager (also called estate manager) is a person or a company who is hired to operate a real estate in exchange for a fee. Usually, property owners hire a property manager when they don’t have the time or are unable to manage the property on their own.
The property that is run by a property manager can be with any type of ownership structure: single owner, shared ownership, apartment complexes, business offices, etc.
How much do property managers make per year?
The income of the property manager depends on their education, experience, performance and the area they’re operating in. The statistics differ for residential property managers and other property managers.
According to the latest statistics, the average salary for a residential property manager is between $49.743 to $64.441. On the other hand, the average salary of other types of property managers with multiple properties (mostly companies) is between $82.505 and $109.343.
Types of Property Managers
The basic division of property managers is residential property managers and other types of property managers. This can further be divided into:
- Property managers who manage condominium and homeowners’ associations
- Property caretakers who board up and secure foreclosed properties
- Property managers who oversee the construction and/or repairs of properties
- Leasing agents who work only with finding and placing tenants
- Property managers who work with vacation rentals
- Residential property managers who place tenants and service the property over the whole duration of the tenancy
What does a Property Manager do?
The responsibilities of a property manager vary depending on the type of property they manage. Some of the most common responsibilities are the following:
- Rent responsibilities: the basic job of a property manager revolves around the rent, specifically setting the rent, collecting it and adjusting it if and when needed
- Marketing responsibilities: the property manager is responsible to advertise the property and rentals, not just by posting ads on different websites, but also by generating leads and adding them on MLS (multiple listing service) and with it, find new tenants.
- Tenant responsibilities: selecting the right tenants, handling complaints from tenants, and handling move outs and evictions
- Setting the rules: property managers often make decisions on what to allow in the property and what not. This mostly refers to quiet hours, social gathering in common areas, allowing pets and other things that can influence the regular life of the tenants in the building
- Maintenance and repair responsibilities: keeping the property in peak condition and do the necessary fixing when and where it’s needed
- Supervising responsibilities: if the property is populated, the job of a property manager is to oversee if everyone is acting accordingly. If the property is vacant, the job of a property manager is to keep the property safe against vandalism, burglary or general deterioration.
- Budgeting and recording responsibilities: the job of a property manager includes a bit of accounting as well. They need to keep track of the income and expenses they did, plan the budget and project it for the future periods.
- Tax responsibilities: as a person who knows the property best, the property manager often helps the owner prepare and file tax reports for the property
Property Manager as a career
To become a property manager, no official education is required besides a high school diploma, but a knowledge of the local real estate market is desirable and often critical. This is because a property manager is responsible for many aspects of the property and to do that efficiently he or she needs to know which decisions to make, and how those decisions will affect the future of the property.
In practice, most owners look for a property manager with an education in some of the following areas: business administration, accounting, real estate, and public administration.
There are a few institutions that offer training courses for property managers, but the most famous one is BOMA - Building Owners and Managers Association. A property manager can also be qualified as a Certified Property Manager through an organization called the Institute of Real Estate Management.
How are property managers paid?
In most cases, property managers charge one month’s rent to procure a tenant. After the first month, they charge a monthly management fee, either as a percentage of the rent or a flat fee per rented unit. The fees depend on the housing market and are usually around 5% to 10% of a month’s rent.
In other cases, though, besides the regular fees, property managers also charge a lease renewal fee amounting up to 50% of a month’s rent, which is used to cover the administrative expenses related to signing the new lease contract.
Besides receiving a salary or an hourly wage, if the property manager is operating privately, they can receive a free or discounted rent if they are living in the same residential building.
Why are property managers needed?
Investors are the most frequent employers of property managers. This is because most investors have a portfolio of real estate investments and finding the time to manage them all is almost impossible. By hiring property managers investors can dedicate more time to managing their investments, instead of managing the properties.
What’s the difference between a property manager and a landlord?
Renters rent directly from the landlord, while a property manager acts as a mediator between the renters and the landlord.
What’s the difference between a property manager and a facility manager?
A property manager is responsible for taking care of the building and its owner. A facility manager, on the other hand, is responsible for taking care of the building for the PEOPLE in the building (overseeing the processes in it mostly).