Mastering property management: Key roles, responsibilities and best practices

The global market for property management has experienced significant growth recently. Numbers published by the revenue impact company MarketsandMarkets illustrate this growth: The global market is expected to reach a value of USD 36.4 billion by 2028, which is a 47 per cent growth compared to 2023.

Of course, many landlords handle a limited number of properties independently. Larger housing companies, though, often hire the services of a property management company. That way, they can best oversee and optimise the different tasks and responsibilities.

But what does property or real estate management really involve? And what responsibilities do property management companies undertake? This article aims to answer these key questions and provide valuable insights into the topic.

What is property management?

Property management involves having an external service provider supervise and manage owner-occupied or investment properties. This service is available for residential, commercial, or industrial real estate. Property managers' and property management teams’ primary duties include executing tasks assigned by property owners, providing them with peace of mind and saving them a precious amount of time. They are responsible for supervising daily tasks (like repairs), preserving property value and generating revenue through effective tenant management, maintenance, and financial oversight.

From residential to specialised: Exploring the different types of property management

As the types of properties vary, so do the forms of property management services. Some focus on managing specific types of properties, while others provide general services. Here are the most common types of property management:

Residential property management

Residential property management involves overseeing various rental properties and facilitating the tenancy process. These properties may include:

• Individual residences
• Holiday accommodations
• Buildings with multiple flats
• Terraced houses
• Blocks of flats
• Caravans, etc.

Commercial property management

Managing commercial properties presents unique challenges due to their diverse nature. These challenges extend across a multitude of sectors, encompassing:

• Hospitality establishments such as hotels
• Retail spaces like shopping malls, dining venues, and gas stations
• Office buildings housing businesses like real estate agencies or medical practices
• Co-working environments, workspace rentals

Management of industrial assets

Industrial properties eligible for management encompass:

• Facilities for heavy manufacturing, like automotive plants and steel mills
• Light manufacturing plants, such as those for food packaging
• Warehousing spaces
• Distribution centres

Specialised Property Administration

Various forms of real estate defy easy categorisation but still demand effective administration. These encompass:

• Cinemas
• Stadiums
• Hospitality establishments
• Elderly care residences
• Educational institutions
• Religious institutions, etc.

What are the essential duties in property management?

Managing agents shoulder crucial responsibilities. They are the point of contact in tenant interactions and ensure compliance with industry standards. They must also guarantee adherence to legal regulations. They also handle tenant issues, oversee property maintenance, and are responsible for communicating with owners.

The duties typically associated with property management encompass:

1. Assessing potential tenants
2. Crafting, executing, and updating leases on behalf of property owners
3. Facilitating rent collection
4. Property inspection and maintenance, including cleaning, landscaping and snow clearance
5. Coordinating essential property repairs
6. Establishing and maintaining budgets for property maintenance
7. Familiarising with regional and federal landlord-tenant statutes
8. Supervising staff members
9. Managing tax obligations
10. Organising property viewings
11. In some cases, providing reception and concierge services

Firms are required to adhere to pertinent state and local landlord-tenant regulations.

What is a property management system?

A property management system (PMS) is a software tool used for lodging in the hospitality and commercial residential rental sectors. Beyond its traditional domain, PMS finds utility across diverse sectors, including manufacturing industries and local governance. A PMS can also be called a hotel operating system. It centralises operations, streamlining organisational, scheduling, and transaction management tasks.

How much does property management cost?

What are the typical expenses associated with property management? The service charges for property management services usually range from 8% to 12% of the landlord’s rental income.

An advantage of hiring a property management business is the range of benefits it offers landlords and homeowners. Property management services help reduce vacancy rates by effectively marketing the property and finding suitable tenants quickly. They also save landlords valuable time by handling day-to-day tasks, tenant relations, and maintenance issues. Additionally, they can increase the property's value through optimal management and strategic enhancements, ensuring it is well-maintained and appealing.

The extra income generated may sometimes offset a part or all the management fees. This allows you to keep the same profit level without the hassle of managing the property.

What is asset management, and how does it differ from property management?

Real estate asset management and property management focus on different core areas. Real estate asset managers enhance a property's value to meet investment goals. They are employing their expertise in property valuation and market trends to make informed decisions that maximise returns. They focus on long-term strategic planning, including financial forecasting, investment analysis, and portfolio management.

On the other hand, property managers handle the day-to-day responsibilities of a property's physical maintenance and tenant relations. Their operational functions, such as rent collection, property repairs, and lease management, highlight their hands-on approach. While asset managers use their know-how to optimise property value and investment performance, property managers ensure the property's efficient operation and upkeep. In short, asset management focuses on strategic foresight and financial optimisation, while property management focuses on operational implementation and daily management tasks.

PriceHubble’s real estate solutions are designed to cover the entire real estate value chain, catering to a wide range of professionals in the real estate sector, such as asset managers and property managers. Learn more about our property valuation and insights solutions by booking an appointment with one of our experts.