There Are 3 Different Types Of Property Management Companies To Choose From

WHICH TYPE OF PROPERTY MANAGER IS BEST FOR YOUR RENTAL PROPERTY AND PERSONAL NEEDS?

Property Managers provide important services for rental property owners looking to maximize their returns while taking a more passive role. Hiring a professional to handle the responsibilities that come with home ownership is a smart move in most cases and in general there are three different categories of property manager out there to choose from. All three will collect your rent and manage your rental property for you, but the way in which they do so will vary greatly. Which of the three types best aligns with your style and goals?

TYPE 1: THE MOM & “POP”PERTY MANAGEMENT COMPANY

The Mom & Pop Property Manager is going to provide rental property owners with a more intimate experience. As a client, you’ll likely speak to the company owner for any and all issues and you won’t have to guess who’s taking care of your property. You’ll receive prompt communication via text messages or phone calls, as well as emails, and they’ll come directly from that face and voice you know.

For some owners, especially those renting out single family homes, this level of engagement may be preferable. However, from a systems standpoint it is very inefficient. One personal juggling all the balls in the air can create an air of comfort, but it hints at an inability to take advantage of one major perk of hiring a professional: their ability to find the lowest maintenance costs by having their own in-house team or negotiating lower prices with vendors thanks to their size and scalability. Nonetheless, there are enough perks in the Mom & Pop model that makes it attractive for many property owners.

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TYPE 2: THE STATE OR REGIONAL PROPERTY MANAGEMENT COMPANY

With a state or regional property manager you’re obviously working with an entity that’s larger than the Mom & Pop. Naturally, it’ll be much less likely that you’re going to have the company owner on the phone, but instead you’ll communicate directly with specialists for the issues that arise. Most likely, you’ll be communicating with a leasing director, maintenance director, and general manager because these businesses have increased efficiency by compartmentalizing.

In terms of communication style, you might communicate via text or phone when emergencies arise, but the majority of conversation and interaction will take place on a portal system or through some type of online software. You’ll come to know the professionals who are taking care of your property, but not to the degree that you would with a smaller, more intimate Mom & Pop. In exchange, you’ll see greater savings and room for growth thanks to that increased efficiency.

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TYPE 3: THE CORPORATE OR NATIONAL CHAIN

Larger national companies often maintain organization through the use of account managers. These companies have greater reach than ever before thanks to increases in technology and a change in societal expectations since the Covid pandemic. These account managers will have a full file on your property and it can be reassuring to have that point person, but all of their information will be coming to them second-hand. They will have very little familiarity with your property and almost certainly will not have ever visited it. They typically have relationships with maintenance groups and leasing subcontractors and will rely on them for the information they relay back to you.

Corporate property managers of this ilk maximize the opportunities that modern technology brings to the real estate world. By operating from centralized locations they can reduce on-the-ground costs which are hopefully passed down to their clients. However, the tradeoff for this maximized efficiency is any first-hand knowledge or relationship with your property. Depending on your property and investment style, this may be a structure you prefer.

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CONCLUSIONS AND NEXT STEPS

Different property owners have different needs so there’s no general best property management company structure out there. Sure, Goldilocks preferred the medium bed, but the other two wouldn’t have been “too hard” or “too soft” if those weren’t the preferences for someone else. That being said, the State or Regional Management Companies most closely operate in that middle-space. For many landlords, these property managers provide that ideal combination that is not too intimate, not too personal but still not too distant. They’re responsive and the information they have is received promptly and with high integrity because it’s coming from within.

Nexus Property Management® is a national franchise with five offices across the country but we operate as five individual Regional Property Management Companies. Some of the newer offices might even trend toward the Mom & Pop style while they’re still growing. If you’re interested in learning more about Nexus’ services, contact any of our teams across Arizona, Connecticut, Massachusetts, and Rhode Island.

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Mick Lefort is the General Manager of Nexus' New Haven County Franchise Office and the Vice President of Operations for Nexus Property Management®, a National Property Management Franchise that manages all types of rental property from single family homes or condos to large apartment buildings and complexes.

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