When people who aren’t too familiar with the intricacies of the field of real estate hear about what they conclude to be disproportionately high commissions earned from each flipped property, they assume that this is an easy business to make lots and lots of money in. Yes, it’s true that you can make lots of money as a property flipper, a real estate agent or even a property manager, but it’s not as easy as people think. Things can get rather stressful, especially when you fall into the role of property manager, whether by default (if you’ve assumed temporary custodianship of a vacant property you’re trying to sell for a client), or directly (if you have outright bought a property and you’re busy fixing it up for the flip).
The other type of property manager is one who manages multiple properties and is perhaps tasked with the maintenance of those properties while their renting tenants actually occupy them and pay rent. Either way, there are some hidden details of property management which could help you sometime in the future if you’re looking to complete any transaction around the purchasing or selling of your property.
A need for more specific due diligence
Naturally there are what could be considered to be regular, straight-forward issues that could arise as part of the typical dynamics around property management, such as infrastructural issues (plumbing , electrical wiring, drainage, etc), security (fending off vandals and squatters), pest infestation, overgrowth, etc. However, taking what is otherwise this blanket approach to managing a property that is in ownership transition is a recipe for disaster. You’re just asking for trouble, because the due diligence around property management requires a little bit of a narrower focus on the unique issues which could develop around that specific property.
Often when a set of new owners take up occupancy of a property that was pre-owned, they inevitably find themselves dealing with a myriad of issues that leave them wondering if the previous owners didn’t purposefully mess things up before leaving.
What would help is asking the previous owners for an honest report of the issues they have to deal with in the maintenance of the property, but unfortunately, due to the fear of exposing major issues which could contribute to the devaluation of the property, current owners are usually not that forthcoming about those issues.
Checking out the peripheral markets
The next best thing is being neighbourly and getting to know the local market. If you think knocking door-to-door and introducing yourself to all the locals in the neighbourhood is a bit creepy, then you can always study the peripheral markets servicing the primary property market. If there is a busy, dedicated West Palm Beach Pest Control service provider in the area, for instance, what that suggests is that as part of effectively managing any property in the area, pests need to be controlled. That way prevention can indeed make for a better, cheaper approach than having to reverse any damage done, as part of managing a property which may be in transition with regards to its ownership.