According to government guidelines, in America, it is not illegal for real estate agents to perform the duties of a property manager. In most states, it is legal, but in some places, the real estate company might ask for a property manager’s license to carry out their duties. Making your real estate agent work on your properties as a manager can actually turn out to be a golden opportunity for you.
There are multiple different benefits to hiring a real estate agent as a property manager and some drawbacks as well. In this article, we will try to find out what they are. This will help you as a real estate business to take a call on whether this is a suitable option for your business.
Why can real estate agents be great property managers?
Let us find out why real estate agents can be great property managers and help your business.
They already have the contacts and know the clients
One of the biggest advantages of working with your real estate agents as your property managers is that they already know the clients. If they are the ones who sold or helped rent out a particular property, then they are familiar with the client and have their details. They interacted during initial sales and the leasing process, so the clients will also be comfortable interacting with them.
Works as an incentive for extra income for agents
According to statistics, hiring a real estate property manager can cost up to 7-10% of the total income from your rental property. Property managers are very costly, especially if they come with management degrees and licenses. But it can become much cheaper if you can provide certain training and guidelines to your real estate agent to do the management work.
Property management can also act as an incentive for extra income for your real estate agents. Working as an agent is an uncertain job profile where the maximum income is based on sales and incentives. Also, according to NAR reports, the number of registered agents in the USA is more than 1.5 million; hence the competition can be quite steep to make sales and earn incentives. So, rental property management might come as a pleasant offering for agents.
It can work cohesively with real estate agents' current portfolio
The real estate business is all about building contacts, and when your agent starts to manage your properties, they can easily develop more contacts and get you more business. It is a win-win situation where they themselves also earn more from the incentives of the new clients they bring in from these referred contacts.
It can be scalable to accommodate your needs
Real estate agents, if they work as property managers, will obviously do this as a side hustle for extra income. So, you can scale down or scale up their services as per your needs since this is not their primary job, to begin with. If you have a rental property with only occasional customers, like a BnB, then a real estate cum property manager is a great option. They can get you the clients and also manage interaction with them and take care of the property at the same time.
Upkeep the apartment to keep it sale worthy
When your property is under one particular real estate agent, and the same person works as your property manager, then proper maintenance becomes their headache. Why? If they do not ensure proper upkeep, then they themselves will not be able to make a sale and earn their extra incentives. So, you, as a property owner or real estate business owner, do not have to worry about the condition of the property.
What are the drawbacks?
But not everything about hiring real estate agents as property managers are all great. There are some drawbacks too. Let us find out what they are.
Real estate agents might lack expertise in property management
One of the biggest drawbacks of employing real estate agents as property managers are the fact that they may not have the proper training to manage properties. Property managers come with their own experience and expertise in the field they work in, hence can do a more efficient job of managing. We understand that property managers may cost a little more, but if you have a diverse portfolio, it might be better to hire a dedicated manager to ensure smooth work.
They might get overloaded with work
Real estate agents who work as full-time agents already have a lot of work of regular agents, like looking for clients, publishing property listings, and showing houses. They also have to finalize deals and close property deals to make their payments. If you add property management tasks like maintenance, regular cleaning, paying bills, taking care of insurance and taxes, and other such work, it can become chaos. So, before you pass on this work to your agent, think twice if they have the bandwidth to perform these additional duties.
They might not have the foresight of a property manager
When it comes to things like Common Area Maintenance, insurance renewal, property tax payments, and more, property managers see these things from a mile away. But real estate agents may not have the foresight to consider these things because of their lack of experience in this field. This might land you in legal problems with the government and the customers. So, if you work with a real estate agent and want them to manage your property, ensure you provide adequate training.
Manage your real estate properties with Assetsoft
Worried about your property management plans? Running short on budget but want to do a good job nonetheless? Do the cons of hiring a real estate agent as a property manager seem slightly higher than the pros? We understand.
We are here for you. Outsource your property management tasks with Assetsoft. We will make the best of technology selection and expert human resources to work for you. You get the best of both worlds with our team at Assetsoft and yet pay only budget-friendly prices.
Why stay worried about property management when we are just a call away? Talk to us to learn how we implement our property management services.