For rental property owners, a crucial choice must be made whether to manage your properties or appoint a professional Canyon property management company. On the one hand, do-it-yourself property management can be practical for owners with repair and maintenance skills who enjoy interacting with their renters. Yet, managing rental properties daily is an actual job that can be vastly time-consuming. This is why for others, professional property management makes more sense. Hiring a professional to conduct all the day-to-day management frees up a lot of time, which rental property owners can use to develop leads and expand their investment portfolio.
So, how do rental property owners who hire property management companies compare to rental owners who manage their properties? To help you better understand this, here are a few recent statistics about rental property management that give you valuable insight into the practices 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. A.k.a. “mom and pop” landlords, individual investors make up a significant percentage of rental property owners nationwide, particularly in owning single-family rental homes.
More (Multi-Family) Rental Units Are Owned by Businesses than by Individuals
At the same time, approximately 25.8 million rental units aren’t operated 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 sum value of these three properties is below $400,000. Approximately 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 above.
Single Property Landlords Tend to Buy as a Primary Residence
While owning three properties is the average nationwide, most landlords commenced their rental property ownership by switching a primary residence into a rental. In actuality, about 50% of landlords who own just one rental property obtained it as a primary residence and then later converted it to a rental.
Half of All Landlords Manage Their Own Properties
When it comes to property management, statistics prove 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 use a professional to handle their property management. These rental property owners tend to be investors who own properties in more than one state, those seeking to expand their wealth through investing, and those who own multi-family properties.
The remaining 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 interesting to see that landlords who manage their own properties tend to find their investment opportunities limited. It’s no wonder that landlords who manage their own properties tend to own a smaller number of rental properties. When executed properly, managing rental homes demands a substantial investment in time and resources.
Investors who intend to run their investment properties like a business – which they are – are more inclined to get a qualified professional to manage their properties for them. The majority of DIY landlords realize that professional management is a vital element of their strategy to continue to invest in rental properties.
Savvy rental property owners hire professional property managers for many reasons. But in most cases, these reasons include benefits such as saving time and being able to focus on other important aspects of the rental business. Other benefits include having access to more resources, such as for marketing purposes, and better financial management and reporting. Hiring the right property manager can give you critical insider information into local rental markets, help you find off-market bargain properties, and save money on maintenance and repairs through preferred vendor programs.
Imagine you’re a rental owner contemplating obtaining a property management company. These statistics state that it can be a smart idea that will allow you to improve your rental business. Whether you’re aiming to save time, maximize your rental income, or just build your rental portfolio more quickly, working with a company such as Real Property Management High Plains can benefit you in many ways.
So why wait? Contact us online today to learn more!
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