Please note that this article is intended for educational purposes only and should not be deemed to be or used as legal, employment, or health & safety advice. For guidance or advice specific to your business, consult with a qualified professional.
If you’re thinking of starting a property management company, you’re in the right place. We’ve pulled together a quick guide on what you’ll need to think about to ensure success.
What is a property management company?
A property management company is a company that deals directly with prospective tenants or renters. They get involved in rent collection, contracts and leases, maintenance and repair. They also help with marketing properties and generally give landlords peace of mind that their property is in good hands and everything involved with property management is looked after.
There are a few different types of property management, mainly:
- residential
- commercial and industrial.
Property managers are often also the letting agent for the property so everything is in one place. Landlords can have multiple properties that need managing so a company that does it all is ideal.
What skillset do you need for property management?
How do you know if property management is the right business for you? You’ll need to be organised, have great communication skills, be flexible and a people person.
Organisation is absolutely key in property management, you will need to be on top of your diary to make sure that contracts are signed, properties are cleaned, and repairs are done in a timely manner. Using your diary is paramount and making sure that you have everything you need for each property, so things are not held up chasing documents or information.
Communication can help you with the organisation. Picking up a phone is often much easier and quicker than sending emails that may be missed. However, always follow up with an email to make sure that everyone is aware of what is going on and that your tenants are not left frustrated that they do not know when viewings are going to take place or when the new boiler is going to be fitted. Most contractors require at least 24 hours’ notice before workmen or visits are scheduled so tenants can be there or not depending on the circumstances.
Being flexible is always a good trait in business and none more so than property management. Not everyone will be available during normal office hours. If you can, make sure that the tenants and landlord know who to contact for 24-hour callouts for emergency repairs.
Finally, you have to be able to foster good relationships with people, to ensure a successful business. Wanting to work with different people, staying professional and friendly is important when you will be dealing with the public. Knowing how to keep calm in stressful situations and not letting emotions get in the way of running your business is also important.
Setting up a property management company: a checklist
Setting up a company involves lots of preparation and research. At Square, we love to help those who are interested in setting up a business, so check out our handy hints below to get a full round-up on how Square can help you and create your own property management startup checklist.
Write a business plan
First, you’ll need to know what your business will look like. What niche do you want to get into: residential, commercial, or industrial? Do you want to do a bit of all three? You need to have this all clear in your mind before you set up your plan. Also think of who your target audience is. Do you want landlords that have one property or multiple? Do you have a plan for expansion?
You will also need to look at how to cover certain costs, from funding to start-up costs and what your pricing strategy will be. Where do you want to work, will it be an office in town or will you run your business from home? A business plan is the first thing banks will want when applying for any finance, so it’s important to have this in place.
Buy insurance
Every business needs to have insurance and property management companies will need professional indemnity and public liability insurance.
Professional indemnity insurance protects you if a claim is made against you including negligent advice or negligent services provided.
Public liability insurance covers you for any claims brought by members of the public during business activities, covering injury or property damage.
Check out our blog on small business insurance for all the ins and outs.
If you have staff, you will also need employers’ liability insurance. It is a legal requirement for businesses with one or more employees.
Property management company requirements
When setting up your property management company, it is important to know what you need to get started. As well as insurance, you may need permits or licenses to work.
There are no legal regulations for property managers, but many choose to join a trade association as added protection. Check what your legal obligations are and make sure your contract terms cover exactly what you will and won’t do.
Also, ensure you are correctly registered as a business, whether it be as a sole trader or limited company.
Software, tools and systems
Square is here for all your business management needs. We have tools for invoices, appointments, marketing and more.
With Square Invoices, you can send quotes and invoices from one system and keep everything together, streamlining a process and making it easier to get paid. Use Square Virtual Terminal to take payments over the phone with no hassle.
Square Appointments is the perfect diary management system for people on the go, with availability for customers to book online, you can send reminders and even make sure all notes are collated for each client. Your team will be able to see all the profiles in one easy-to-use place to make everyone’s day a little bit easier.
Having a decent IT set up will really help propel your business. A laptop or computer that can handle having multiple systems is a worthwhile investment.
Marketing and reaching new customers
Property management might have different target audiences so setting up the correct marketing is important. You want to get landlords to use your company for their properties but you also need to market those properties to potential tenants.
In your business marketing strategy consider which different channels you’ll use and how they’ll be best to reach your audience – for example, social media, your own website and paid for print and digital advertising.
Social media is still a huge channel for marketing and there are so many ways it can help grow your business.
By using social media, you can attract customers and leads with very little cost.
Starting a new venture can be daunting but we know that chasing your dreams and being a successful property manager is achievable with the right knowledge and guidance. Square is on hand to give you the help and advice you need with our Townsquare resources and all the tools you need to start a property management company.