Real estate is the single largest investment of an individual and it can generate years of income if you are able to keep a tenant in the property. Being a landlord along with a full-time day job means you are not able to give enough time to your property that is necessary to maintain it. Hiring a property manager can be beneficial in several ways:
- Higher Quality Tenant
- Fewer Costly and Time-Consuming Legal Problems
- Seamless monthly income
- Shorter Vacancy Cycle
- Better Tenant Retention
- Tighter Rent Collection Process
- Lesser rent-default assurance
- Easier eviction process
- Regular property audit
- Lower Maintenance and Repair Costs
- Personal Benefits
Apart from the above-mentioned benefits and much more than you can count, getting a property management service on board to manage your investment in real estate, there are tax benefits as well.
Bills of any service that you are taking to maintain the investment are tax-deductible for a landlord. This means lower tax bills. Keeping the invoices and statements issued by Property Management Company can let you claim the entire cost of the services.
Property Management Services provided by a professional company not only provides tax-deduction for the landlord, they also provide serious organisation. Issuing and managing all the paperwork between the tenant and the landlord is a part of Property Manager’s job. This comes in really handy at the time of filing taxes, especially for property owners who are not particularly organised or good at keeping accounts. This helps the landlord to take the maximum deductions and credits he/she is permitted, which might have been missed if the paperwork had not been organised and sorted.
It might not be a direct tax advantage, hiring a property manager benefits property owner who lives far away from the property. The property manager acts as a connection between the landlord and the tenant for filling all the necessary paperwork and handling daily issues. Since all the maintenance and repairs invoices are being issued to the landlord from the property management company, it keeps all the tax-deductible expenses from the same source.
If you have a large or multiple properties, managing it can easily become a full-time job, even to the landlord owning the property in the same city. So, if the property owner is not up for making property management their daytime job, delegating it to a property manager gives him/her the liberty to do whatever he/she would like to do with the time. Property managers use their experience in the industry along with their large contact base to conduct business, keeping property owner’s best interest in mind. This often happens so that they handle the work better than landlords who don’t have experience in the field. With this, only the property is managed in a better way but they also increase the owner’s tax deduction eligibility, which owner may have overlooked, like low-cost but deductible energy efficient upgrades.
These are benefits are for an ideal situation. If the property management company is good and trustworthy and competent, then only favourable results can be expected. It is very important that you chose wisely and take a well-informed decision. Do not forget to reference check.