There are three primary methods of property management:
- Self-managed property management
- In-house property management
- Outsourced property management.
Let’s take a deep dive into understanding the differences between the methods.
Self-Managed Property Management
Self-managed is the easiest to understand of the three forms of property management. It is when an individual and/or real estate investor manages the property on their own. Landlords who utilize this method of property management will experience a time/money trade off. We will touch on this in a bit.
In-House Property Management
In-house property management is the method that most tenants are familiar with. It is a form of property management that is owned by one entity, typically an organization, and is a form of self-management.
Apartment buildings are a great example of in-house property management. An apartment building is owned by an organization with an in-house property management team, leasing, maintenance, and custodial staff. They report within their own group and handle inquiries internally.
Notably, in-house property management can stretch across regions. For example, the leasing office may be in Toronto, but the actual apartment building could be in Kelowna. Both offices are under the umbrella of one entity, therefore, it is still considered in-house property management.
Outsourced Property Management
Outsourcing involves a property owner outsourcing property management service(s) to a third party. For example, say you own a condo, townhome, or house and don’t want to deal with the hassle of maintaining the property and finding tenants. This would be the perfect opportunity to outsource property management services to a third party! Real Property Management is considered “outsourced” for real estate investors!
What are the benefits of outsourcing property management?
Time = money. In economic terms, it is the opportunity cost the investor is choosing between time lost and time earned back. That’s why you should hire a Property Manager – to earn time back. The time earned back can be used to (1) learn a new skill, (2) spend time with your friends and family, (3) learn more about real estate to diversify and grow your portfolio, or (4) get to know your community! The options are endless, and we are here to make sure you have time for these options!
For example) Imagine you are in Hawaii with your family on vacation enjoying the warm sun. It’s the middle of winter and you get a call from your tenant saying the furnace broke down. Canadian winters can be brutal, so the request is urgent! Do you (1) leave your loved ones for a bit to handle the situation, or (2) have your Property Manager fix the situation so that you can spend time with your family? In this scenario, the Property Manager is saving you time lost with your loved ones, and money should you need to fly back from your tropical vacation early.
At Real Property Management, we want to work with individuals who have an investor’s mindset – people who want to build their portfolio and diversify. When you sign on with RPM, it’s a two-way partnership. We work as Asset Managers to help build your real estate portfolio and acquire wealth for you, and you trust us through the process! Let’s create something special together.