For rental property owners, an essential choice must be made whether to manage your properties or recruit a professional Murrieta property management company. On the one hand, do-it-yourself property management can make sense for owners with repair and maintenance skills who enjoy interacting with their renters. In any case, managing rental properties daily is a genuine job that can be very time-consuming. This is why for others, professional property management makes more sense. Employing a professional to shoulder all the day-to-day management frees up a lot of time, which rental property owners can use to develop leads and grow 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 inquiry, here are a couple of recent statistics about rental property management that give important insight into the practices of rental property owners nationwide.
Individual Investors Own 20.5 Million Rental Units
Of the roughly 50 million rental housing units in the United States, around 41% – or 20.5 million rental units – are owned by individual investor landlords. Otherwise called “mom and pop” landlords, individual investors make up a significant percentage of rental property owners nationwide, especially in owning single-family rental homes.
More (Multi-Family) Rental Units Are Owned by Businesses than by Individuals
Simultaneously, around 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. What’s more, for most landlords, the consolidated 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 just 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, numerous landlords started rental property ownership by transforming a primary residence into a rental. As a matter of fact, about 50% of landlords who own just one rental property got it as a primary residence and afterward transformed it into a rental.
Half of All Landlords Manage Their Own Properties
In terms of property management, statistics show that about 45% of property owners manage their own properties. Most of these are individual investors and own three or fewer properties.
In contrast, 44% of property owners outsource their property management responsibilities to a professional. These rental property owners tend to be investors who own properties in more than one state, those looking to grow their wealth through investing, and those who own multi-family properties.
The last 11% of landlords are individuals who manage properties owned by others, or professional landlords.
The Benefits of Hiring a Property Management Company
When reviewing these statistics, it’s interesting to remember 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 well, managing rental homes requires a considerable investment in time and resources.
Investors hoping to run their investment properties like a business – which they are – are more likely to recruit a qualified professional to manage their properties for them. Most DIY landlords observe that professional management is a fundamental piece of their strategy to continue to invest in rental properties.
Savvy rental property owners hire professional property managers for many reasons. However, generally, these reasons incorporate advantages such as saving time and being able to focus on other important aspects of the rental business. Other benefits incorporate having access to more resources, such as for marketing purposes, and better financial management and reporting. Recruiting the right property manager can give you important insider information into local rental markets, help you find 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 demonstrate that it can be a brilliant choice that will empower you to develop your rental business. Whether you’re hoping to save time, maximize your rental income, or simply develop your rental portfolio quicker, recruiting an organization like Real Property Management Bella can benefit you in numerous ways.
So why wait? Contact us online today to learn more!
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