Upon first examination, real estate agents and property managers would seem to be ideally suited to moving between each others worlds. Both professions are dedicated to helping people find a place to live. Both require intimate knowledge of local neighborhoods, local property laws and local trends. And as we've seen in the last three years, both professions are very much at the mercy of a volatile United States housing market.
It is that volatile housing market that has caused many real estate agents to lay down their arms and seek a steadier income. With it's steady salary and skills common to real estate, property management is an attractive lateral move for real estate agents.
While real estate agents and property managers do indeed share related job skills, there are still some gaps that agents will need to fill if they want to become successful property managers.
Know Your State's Landlord/Tenant Law Inside and Out Unless you want to hear the phrase "landlord negligence" in a courtroom setting, it is highly recommended that a new property manager know the landlord/tenant law of their respective state. Landlord/tenant law sets out the guidelines that govern landlord/tenant interaction.
Landlord/tenant law varies from state to state, but there are some common responsibilities that landlords and property managers face in most states. Some of these responsibilities are:
- Make property habitable before tenants move in;
- Make and pay for repairs due to ordinary wear and tear;
- Refrain from turning off a tenant's water, electricity or gas;
- Provide written notice to tenants when ownership of the property is transferred to a new landlord; and,
- Do not unlawfully discriminate.
These are the general requirements that most states have in place but more specific statutes will vary greatly from state to state.
Become Service-Based Real estate professional and property management company owner Eric Burgin put the day-to-day job differences between real estate agents and property managers very well:
"While the sale of a home is transaction based with elements of service, property management is service based with the transaction of signing a lease being a small component."
Real estate agents count on an indeterminable blend of personality, salesmanship, and trust to do their jobs well. In other words, "people pleasing" is high on the list of desirable qualities for real estate agents. This quality is important in a transaction based job.
A property manager, on the other hand, will need to manage tenants' expectations while simultaneously acting in the interest of the community. The well-being of a community's tenants is a property manager's number one priority. But that must be balanced with the myriad of personalities, wants and needs of dozens if not hundreds of tenants. Property managers would love to please all of their tenants but the reality is that will not happen. This is the conundrum of being service-based over being transaction-based.
The service aspect of property management extends into the office as well. While a real estate agent may be singularly concerned with finding the right property for a handful of clients, a property manager must juggle:
- Tenant screening;
- Vendor relations;
- Compliance with the law;
- Maintenance staff and repairs; and,
- Property owner expectations.
Most of these tasks extend far beyond the initial transaction between manager and tenant. For property managers, the transaction is where the job begins. For real estate professionals, the transaction is where the job ends.
Find a New Set of Contacts As a real estate agent, your industry contacts have become an invaluable source for getting deals done. Your relationships with local banks, property inspectors, title officers, government officials and other real estate agents have proved to be beneficial time and time again.
As a property manager, you'll need to develop a new list of contacts for various services. These services will need to include:
- Trash removal;
- Security; and,
- Local handymen.
In addition to making contacts for these services, it's also very helpful if the property manager has a baseline knowledge of how all of these services should optimally operate. For example, knowing a little about a lot of maintenance work can save a property manager time and an owner money.
Real Estate and Property Management: A Turnkey Operation In this market of foreclosures and short sales, investors are shopping for bargains. These transactions will be completed in the sales division of a real estate company. If a real estate company can assist in a sale and offer to manage that property, they are providing a turnkey operation. With the proper organization, a real estate company can provide additional properties to investors that they may consider purchasing and in turn, bring in additional property management accounts on those properties.
Real estate and property management: a match made in business heaven for agents, managers and companies.
About the Author: Chris Thorman is the Senior Marketing Manager for Software Advice, a website with reviews of software for property management .