Rental Market for Realtors
The post pandemic era might be a good business opportunity for Realtors. In fact, right now you may be representing rental property owners.
More than a few Realtors decide to become property managers too, fulfilling tenant acquisition, background checks and screening, interviewing, showing and processing applications, and taking a lot of work off of owners hands. The reward is often one month’s rent for managing one time, and a renewal commission when they re-lease.
Many owners don’t screen and onboard rental properties well, and Realtors have the training and skills to take this to a new level.
Rentals Managed by Realtors are Growing
Realtors and brokers know about the sales potential of the rental market, and they’re active in it. More rentals are being managed through Realtors because they can do the marketing, know a lot of people, can help find high quality renters and onboard tenants. The renters which real estate agents acquire are often potential home buyers.
And those future commissions are precisely why as a Realtor, you should be building relations with condo and house rental landlords. We’re still in a high price growth phase, and owners often want to sell their rental as the market climbs and peaks. Even if the property is dealt to another landlord, the commissions are the same. You might find a property that will be bought and sold many times in the years ahead.
Rental Boom Continues
The house rental boom is on, and it could continue into the post pandemic period. Home buyers may not have the resources, employment or credit record to buy in 2021/2023, and that creates more demand for rentals. Not getting into the rental sector deeply leaves you outside this excellent source of seller leads and buyers.
As the economy returns in 2021, the condo/apartment sector will once again heat up. Apartment prices are already rising despite this difficult period we’re going through. That’s not to say the eviction moratorium expiry and rent defaults aren’t a problem. Only to say, that this difficult period is temporary.
Some tips for Realtors:
- hone up on the rental market and the types of rental properties that turnover and get sold
- contact rental owners who are advertising for renters (they don’t like that, but have an incentive ready to get them to listen to you)
- contact local property management companies near you and ask about clients who want to expand their portfolios
- use rental property management software to make communications with landlords and prospective tenants
- create content on your website (videos, blogs, social posts) which reveal your passion for the rental market and your expertise with rental properties
- develop a list of high quality renters that landlords will enjoy accessing
- determine a commission rate to charge landlords
If big investment companies are jumping into this market, isn’t that sufficient enough a trend for you to act on?
Short List of Great Benefits
- own and create passive income
- manage portfolio of properties easily with software and grow your commissions
- grow sales opportunities from active short term rentals
- grow your connections with property investors/owners
- help owners achieve better ROI and find new, more profitable rental properties
- tap into properties with positive cash flow
This post is just a reminder of a great sustainable opportunity, which you’re ideally suited for and which can open all sorts of additional, new ongoing opportunities.
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Why the Short Term Rental Market Keeps Booming
The rise of VRBO, Airbnb, and Booking.com reflect the growing affluence and mobility of Americans and how young families love to travel or move to access better employment. Travel is more desirable than ever, because travel locations themselves are offering more.
And these services are built into many smartphone apps and websites thus making renting highly visible and simple to do. Some believe it is technology alone that is driving the growth of this market. As usual, a technology wave heralds in new business opportunities. It’s important to be on the leading edge.
In some markets such as Toronto and Vancouver, Canada, many homes sit idle with no occupants. Local governments are forcing these homeowners to rent them, or face huge fines or fees. These homeowners are looking for property managers.
Whether it’s San Francisco, Miami, Myrtle Beach, Los Angeles, New York, Toronto, Vancouver over in the UK and Australia, travel is more rewarding now. Vacationers are renting farther away from beaches, resorts, and cities. And supply is always an issue for them.
With the US economy being so healthy and a growing middle class of Millennial aged renters, rental apartments/condo/houses have a bright investment return outlook. While many Americans want to buy, the prices and interest rates make that dream unlikely. Short or long, they’re renters.
Short Term or Long Term Rentals?
If you’ve checked out Airbnb lately, for short term stays, you’ve likely noticed how pricey some rentals are. Short term rentals are usually better properties in better locations making them easier to rent at a much higher price. And tenants pay up front. There’s big revenue potential for a smart, experienced Realtor to buy or manage.
But wait a minute, isn’t short term rental property management work intensive?
Property Management Automation
It used to be that short term rentals were hard work, but Proptech and automation has come to the rescue. With online advertising, leases signed online, communication anytime anywhere with tenants via software, online payment, and digital entry security systems, the process is streamlined.
The owner/property manager may never meet renters face to face. The result — some Realtors are managing a portfolio of rental properties and earning impressive commissions all using a property management software solution.
And with automated inspection, maintenance tickets with contractors and cleaners, all involved parties in the rental process can do their work quick without fanfare. Everyone saves time, energy, and money. The rental and maintenance software is taking the work out of it for everyone.
Long term rentals such as houses, condos, and apartment rentals with yearly leases do involve less work, yet may not command the same revenue opportunities. Property investors want better returns and positive cash flow. Long term rentals involve deeper screening of prospective tenants and more documentation and processing.
The downside for short term rental leasing and management is diminishing and if you do a better job of advertising, lower vacancy rates, and creating higher rental fees, you won’t be plagued with rent controls, tenant screening costs, and other tenant regulation issues.
Many property managers would agree that short term rentals is the place to be today and with the economy rolling along, it’s actually a safer market to be in.
How You Manage Rentals is Important
If you’re a Realtor® who has avoided rental property management, your substantial and useful skills will make you more successful in rental property management and investing than other would be participants. Yes, it’s a big trend for good reason, yet some participants may not have the budget, experience, insight, tools, and connections to leverage. There are many ways for you to add value.
Most property managers got into the business by accident, and as a trained, educated Realtor, you’ve got an edge on them
The rise of cloud based property management software is perhaps the one asset that can make this job very doable for you. And if there are parts of property management you don’t appreciate, you can hire others to do it for you.
You’ve probably dabbled in the rental game a bit already by being the leasing agent for some clients. And with your skills in property assessment, negotiation, and transactions, you’ll be a big asset for property investors who are desperate for help with their portfolios.
How to Get Started?
- subscribe to the ManageCasa property management solution and learn how it works
- list your rental property listing and management skills including efficient management using our automation software
- project a focused professional image by crafting a professional looking website that describes your management value proposition so they know it’s not just a side gig
- do a search for property management companies and rental property owners and ask how you can help
Check out some of our other posts on which property types are best, how to increase rental yields, which cities are best, what the best renter incentives are, and how you can help keep property management costs under control.
Try a Free Trial of ManageCasa Right Now.
See also: Property Management | Ratings and Reviews for Software | UK Property Management | UK Letting Agents | Property Management Companies | Accounting Software | UK Housing Market | Hawaii Housing Market Forecast | Australia Housing Market | Property Management Reviews | Buy Home | House for Rent | Property Management | Advertise my Rental | San Francisco Apartment Prices | New York Apartment Prices | Housing Market | Apartment Rent Prices | Best US Cities for Rental Property | Grow Rental Property Yield | California Property Management