Alex Meskouris is the owner and operator of AMPM Property Group, a large management group that oversees a variety of complexes and communities. In the following article, Alex Meskouris discusses below how a management company can increase profitability for landlords, providing a greater return on investment.
A property management company can provide a number of services for landlords, including advertising and marketing the property, screening, and selecting tenants, collecting rent, and handling maintenance and repair issues says Alex Meskouris of AMPM Property Group. By handling many of the day-to-day tasks associated with owning and renting property, these companies can help landlords save time and money. This can ultimately lead to a higher return on investment for the landlord.
Alex Meskouris says that although property management companies do charge for their services, their long-term commitment to maintaining and improving a residence almost always translates to a net profit for landlords. Alex Meskouris of AMPM Property Group explains how property management companies work in landlords' favor and discusses a few statistics that back this up.
How Property Management Companies Work
A property management company is a company that specializes in the care and oversight of residential properties. Alex Meskouris of AMPM Property Group explains that typically, they handle a wide range of tasks on behalf of their clients, from advertising and marketing vacant units to screening and selecting tenants. They may also be responsible for collecting rent, handling maintenance and repair issues, and responding to tenant complaints.
In exchange for their services, property management companies typically charge a percentage of the monthly rent, a flat fee, or a combination of the two says Alex Meskouris. The exact fee will vary depending on the company, the location and size of the residence, and the services provided. However, on average, landlords spend between 8% to 10% of their total earnings from month to month.
Alex Meskouris of AMPM Property Group says that by carefully vetting tenants, property management companies can ensure that residents are less likely to damage the property and stick to their leasing agreements, helping to cut maintenance costs and secure long-term renters. This in turn can generate an increase in ROI by as much as 14%, proving that the cost of working with a management company usually pays off.
How Do Property Management Companies Benefit Landlords?
There are a number of ways in which property management companies can benefit landlords. Perhaps most importantly, these companies can save landlords a significant amount of time and money. Alex Meskouris explains that by handling many of the day-to-day tasks associated with owning and renting property, property management companies allow landlords to focus on other important matters, such as growing their business or spending time with their families.
This hands-off approach can also lead to a reduction in stress, as landlords no longer need to worry about the day-to-day management of their property. In addition to the time savings, property management companies can also help landlords save money in a number of ways.
For instance, these companies typically have relationships with local vendors and service providers, which can lead to discounts on repairs and maintenance. Additionally, property management companies often have access to bulk pricing on things like advertising, which can help landlords save even more money.
Last but not least, Alex Meskouris of AMPM Property Group says management companies can help increase the overall value of a property by keeping it well-maintained and addressing any repair or maintenance issues in a timely manner. By increasing the value of the property, landlords can ultimately achieve a higher return on their investment.
Statistics that Support the Practice of Working with a Property Management Company
A recent study by the National Association of Realtors found that more than 50% of landlords work with a management company and are satisfied with their decision, while only 8% regret it. The study also found that landlords who use a property management company are more likely to experience increased rental income, improved cash flow, and increased occupancy rates says Alex Meskouris.
In addition to the NAR study, a separate survey found that those who worked with a property management company were more likely to be satisfied with their overall rental experience. The survey also found that landlords who used a property management company were less likely to experience rental-related problems, such as uncollected rent or damage to their property explains Alex Meskouris.
These studies make it clear that property management companies can have a positive impact on landlords' businesses. By absorbing many of the day-to-day responsibilities and applying a strategic approach to maintaining and improving properties, these companies are able to make landlords' lives easier and their investments more profitable.
The Bottom Line
Property management companies provide a number of services that can save landlords time and money. By carefully vetting tenants, maintaining the property, and addressing repair and maintenance issues in a timely manner, these companies can help to increase a landlord's return on investment and make their lives easier.
