For rental property owners, a crucial choice must be made whether to manage your properties or engage with a professional Lexington property management company. On the one hand, do-it-yourself property management can be sensible for owners with repair and maintenance skills who enjoy interacting with their renters. Yet, managing rental properties daily is a serious job that can be very time-consuming. This is why for others, professional property management makes more sense. Selecting a professional to undertake all the day-to-day management frees up a lot of time, which rental property owners can use to develop leads and increase their investment portfolio.
So, how do rental property owners who hire property management companies compare to rental owners who manage their properties? To answer this question, here are a few recent statistics about rental property management that provide valuable 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. Also referred to as “mom and pop” landlords, individual investors make up a significant percentage of rental property owners nationwide, notably in owning single-family rental homes.
More (Multi-Family) Rental Units Are Owned by Businesses than by Individuals
On the other hand, around 25.8 million rental units aren’t owned 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 several landlords, the collective value of these three properties is below $400,000. About 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, many landlords launched their rental property ownership by converting a primary residence into a rental. In actuality, about 50% of landlords who have 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 expose that around 45% of property owners manage their own properties. Numerous of these are individual investors and own three or fewer properties.
On the contrary, 44% of property owners use a professional to handle their property management needs. These rental property owners tend to be investors who own properties in more than one state, those looking to boost their wealth by 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 looking at these statistics, it’s necessary to keep in mind 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 implemented correctly, managing rental homes takes a major investment in time and resources.
Investors who wish to run their investment properties like a business – which they are – are more likely to acquire a qualified professional to manage their properties for them. The majority of DIY landlords discover that professional management is a crucial component of their strategy to continue to invest in rental properties.
Savvy rental property owners work with professional property managers for many purposes. However, these benefits typically include saving time and being able to focus on other important aspects of the rental business. Other advantages include having access to more resources, like for marketing purposes, and better financial management and reporting. Working with the best property manager can give you essential insider information into local rental markets, assist you in discovering off-market bargain properties, and save cash on maintenance and repairs through preferred vendor programs.
Imagine you’re a rental owner who is thinking about employing a property management company. These statistics demonstrate that it might be a wise choice that will allow you to expand your rental business. Whether you’re looking to save time, maximize your rental income, or just build your rental portfolio more quickly, collaborating with a company such as Real Property Management Midlands can benefit you in many ways.
So why wait? Contact us online today to learn more!
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