If you own investment property in the Chicagoland area, you may have considered hiring a property manager but are unsure what property management services entail. Many investors think that they can just hire any leasing agent to help them manage their property, others think that property management companies are far too expensive so I am going to break down what a professional Chicago property management company does, and if you should hire one for your investment properties. Let's break down what a Chicago property manager should be doing for you.
Duties of a Property Manager in Chicago
1. Find quality tenants: You can hire a leasing agent to find tenants, but if you want to find quality tenants, you want to find a residential property manager that works in the area your investment property is in. Why is this important? Many leasing agents are just trying to find a tenant and get paid, when you hire a management company they have to deal with the tenant issues for the next year the tenant is in the property, so putting a tenant in that is hard to collect from would make their job incredibly hard. On top of that a property manager has tons of data to show which tenants panned out and which didn't allow them to create better criteria for approving your tenants. Also most agents that do rentals don't focus on rentals as their main source of income so the technology their brokerage has to help screen tenants is much lower quality than the reports we can run as a property management company.
2. Screen and approve/deny tenants: Between fair housing lawsuits and 8 month evictions in Chicago, you want the best when it comes to fairly screening tenants and staying within the law. This is why a dedicated local manager that understands the ins and outs of the law and how to screen tenants for Chicago landlords to only take on quality tenants is vital.
3. Collect rent: The days of knocking on a tenant's door to collect rent are over; besides it being extremely dangerous in today's world, it's also incredibly inconvenient. One of the things that makes us one of Chicago's best property management companies is the fact that renters can mail in a check if they need to but can also pay online or with cash at 7/11's, Walmarts, CVS, or Walgreens stores. This makes collecting rent from good tenants a smooth process.
4. Get through the eviction process: Evictions have so many things that can go wrong in Chicago, having a local expert who works with great eviction attorneys to get your tenant out as quickly as possible can save you thousands of dollars in additional costs and lost rents.
5. Maintenance and turn coordination: Tenant relations are super important to having a lucrative investment and the best way to keep a long term tenant is to make sure maintenance is taken care of and the building is left in optimal condition. Whether your tenant needs a new toilet or they moved out and the property needs to be painted, the process for a good property manager makes owning apartment buildings a worry-free experience.
6. Lease renewals: making sure all of the notices are properly posted in Chicago is super important and very confusing, which is why having a skilled team of property management experts to keep tenants happy and request rent increases and get a new compliant lease is so important.
Can you save money by self-managing in Chicago?
The answer to this question is generally yes when comparing the price of finding a tenant by yourself vs hiring us, or fixing your own sink. However, that does not tell the full story. For one, even if you lost money by choosing professional management services over self managing them, hiring a property manager for your real estate investment means giving yourself peace of mind. Generally speaking, if you are successful enough to be investing in real estate, you probably do not have the time to complete repairs and stay up to date with the latest provisions that have to be included in a Chicago lease. Not to mention unless you have a new born baby at home paying someone to handle management is worth it just to not have to get woken up in the middle of the night to deal with an emergency. However your property's potential earnings are much lower when self-managing, For instance having your rental listed for the wrong price could mean losing a few months of rent if too high or thousands of dollars in rent if too low and someone does rent it right away. Not to mention the cost of being sued for incorrectly disclosing something you thought was insignificant costing you thousands of dollars, having a local expert that is up to date on all the laws is vital to making sure that your rental income today is the lowest it will ever be and not the highest. You should be able to take a vacation and unplug and not have to worry about your investment properties needing you, you should be able to spend your days off work with your family and friends, not at your tenants house doing hard work. Real estate investors often are quoted saying they got into the business to get passive income but they end up working a second job with long hours, or letting the property value fall because they are not keeping up with the preventative maintenance needed to keep a building in good condition. You may not see all the effects your management company is having right away but when something goes wrong you will be grateful to have someone on your side. What is the value of your time, you need to make sure to add that to your consideration when looking at if Property management is going to add an additional cost to your rental property or save you sanity and money.
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Want to learn more about the Chicago Market? Take a look at these articles:
Investing in the Ashburn Neighborhood
Chicago Crime Rate by Zip Code
Don't forget to watch me and Mark Ainley from GC Realty every week live, talking about the latest news for Chicago investors on the Straight up Chicago Podcast Facebook page.
