For rental property owners, a difficult choice must be made whether to manage your properties or employ a professional Franklin property management company. On the one hand, do-it-yourself property management can stand to reason for owners with repair and maintenance skills who enjoy interacting with their renters. Yet, managing rental properties daily is a real job that can be extremely time-consuming. This is why for others, professional property management makes more sense. Employing a professional to deal with all the day-to-day management frees up a lot of time, which rental property owners can utilize to establish leads and broaden their investment portfolio.
So, how do rental property owners who hire property management companies compare to rental owners who manage their properties? To respond to this question, here are a couple of recent statistics about rental property management that give useful insight into the procedures of rental property owners nationwide.
Individual Investors Own 20.5 Million Rental Units
Of the around 50 million rental housing units in the United States, around 41% – or 20.5 million rental units – are owned by individual investor landlords. Better known as “mom and pop” landlords, individual investors make up a sizable proportion of rental property owners nationwide, particularly in owning single-family rental homes.
More (Multi-Family) Rental Units Are Owned by Businesses than by Individuals
On the other hand, about 25.8 million rental units aren’t possessed by individual investors but by some other business entity or collective. The rental units that aren’t owned by individual investors or families tend to be in multi-family properties and apartment buildings.
The Average Landlord Owns Three Properties
On average, landlords own about three rental properties. And for many landlords, the total value of these three properties is below $400,000. Around 40% of landlords own properties with a combined value of less than $200,000, while 30% own properties valued between $200,000 and $400,000. Another 30% of landlords own properties with a total value above $400,000, with only 7% owning properties worth $1 million or more.
Single Property Landlords Tend to Buy as a Primary Residence
Even though owning three properties is the average nationwide, several landlords began their rental property ownership by transforming a primary residence into a rental. Actually, about 50% of landlords who hold only one rental property purchased it as a primary residence before converting it to a rental.
Half of All Landlords Manage Their Own Properties
In terms of property management, statistics reveal that approximately 45% of property owners manage their own properties. The majority of these are individual investors and own three or fewer properties.
In comparison, 44% of property owners delegate their property management errands to a professional. These rental property owners tend to be investors who own properties in more than one state, individuals trying to enhance their wealth via investing, and those who own multi-family properties.
The outstanding 11% of landlords are individuals who manage properties owned by others, or professional landlords.
The Benefits of Hiring a Property Management Company
When examining these statistics, it’s worth noting that landlords who manage their own properties tend to find their investment opportunities limited. It’s no accident that landlords who manage their own properties tend to own a smaller number of rental properties. When executed right, managing rental homes necessitates a major investment in time and resources.
Investors who want to run their investment properties like a business – which they are – are more inclined to employ a qualified professional to manage their properties for them. Many DIY landlords find that professional management is an important aspect of their strategy to continue to invest in rental properties.
Wise rental property owners employ professional property managers for a variety of reasons. However, in most situations, these reasons include advantages like saving time and being able to focus on other important aspects of the rental business. Other advantages include getting access to more resources, like for marketing purposes, and better financial management and reporting. Choosing the best property manager can provide you with valuable insider information into local rental markets, assist you in finding off-market bargain properties, and save money on maintenance and repairs through preferred vendor programs.
Assume you’re a rental owner considering employing a property management company. These statistics indicate that it can be a wise choice that will facilitate you to expand your rental business. Whether you want to save time, maximize your rental income, or just expand your rental portfolio quicker, working with a company such as Real Property Management Titan can benefit you in a variety of ways.
So why wait? Contact us online today to learn more!
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