There are some property owners who prefer dealing with tenants and home buyers on their own without contracting real estate agencies. For Sale Or Rent By Owner properties are considerably cheaper compared to those managed by real estate agents. Managing property is often a complex task especially when you have to deal with tenants as there are some who are usually not keen on paying rent in time. In most cases, tenants and property buyers who deal directly with the owner enjoy great benefits and advantages compared to those who deal with real estate agents. These advantages include:
Relatively lower rental charges and sale price of properties
Real estate agents are paid on commission charges depending on the rental amount or sale amount of property. This commission is passed to tenants as it is included in the total rent payable for renting a specific property. As such, the commission causes an increase in the rental charge thereby making tenants pay more than they would if they were dealing directly with the owner. Properties managed directly by the owner usually have a lower rental charge as no commission is paid to property agents. This works to the advantage of tenants and potential home buyers.
Fewer legal procedures
There are fewer legal procedures involved when dealing directly with the property owner as compared to using a property agent. For starters, the property owner has to enter into an agreement with the agent before the agent can manage the property on behalf of the owner. In addition to this, the agent has to make another agreement with the tenant before leasing the property to the tenant. The same procedure applies when buying a property through an agent. Often, the lengthy legal procedures result in added costs which are passed down to the tenant/home buyer.
Increase in the property’s value
The demand for property managed directly by the owner tends to be higher than that of properties managed by agents. This is because most tenants and home buyers prefer dealing directly with the owner as compared to dealing with a property agent. This increase in demand translates to a higher value of the property and consequently translates to higher tenant retention. What is more amazing about managing the property on yourself without hiring an agent is that you are able to make timely tax payments on rental income.
Understand your investment better
When managing property by your own without contracting an agent, it becomes easy for you to understand your investment better. This includes knowing the exact cost of repairs and renovations in the property and hiring a reputable contractor to make the repairs or renovations on the property. Some unscrupulous estate agents may exaggerate repair and renovation charges on the property thereby charging you more than the actual charges incurred.
Managing your property on your own requires you to be competent, well versed in the current rental and property sale laws, be a good manager and possess great interpersonal skills. With good management skills, you will be able to manage the property with less stress and greater convenience.