As a real estate investor, you’ll have to work with both a real estate agent and a property manager. Without these two, you wouldn’t be able to purchase and maintain your properties. But since both deal with real estate, does that mean you can save money and work with only one of them? To help you decide, this post will tackle the key differences between real estate agents and property managers.
What Is a Real Estate Agent?
In essence, a real estate agent is concerned with the sale of a particular property. They’re there to help you find the perfect property and to ensure that you pay the least amount of money for it. And if should you put up your property for sale, they can help you get the most amount of money for it.
Your real estate agent’s main role is to help you purchase an investment property. This individual will help you look up houses that are within your price range using a variety of tools like the Multiple Listing Service (MLS), as well as via their personal contacts. They will also schedule showings, negotiate deals, and guide you through to closing.
It’s worth mentioning that a real estate agent should work under a real estate broker or brokerage. Real estate agents also can’t call themselves brokers if they haven’t completed Florida’s real estate broker requirements, such as passing the Florida Real Estate Broker Examination.
What Is a Property Manager?
Property managers are individuals employed by homeowners or rental property owners to tend to the day-to-day needs of their real estate investments. They come in only once you’ve purchased your property. Compared to real estate agents that help you purchase a property, property managers are there to help you maintain it. They have a variety of responsibilities, such as collecting rent, screening tenants, preparing lease agreements, conducting regular repairs, etc.
Property managers tend to be employed by people who don’t have the time to oversee their properties on their own or who live far from their rentals. By hiring a property manager, you no longer need to deal with the issues that come with being a landlord. All you have to do is pay your property management company as they will do everything for you. (That is, if you hire a full-service property management company. Some companies only provide partial property management).
Real Estate Agent vs. Property Manager
Now that you’ve got a general idea of what sets the two apart, let’s dig a little deeper. Below, we’ve broken down a few of the key differences between a real estate agent and a property management agent.
#1 Your Relationship With Them
Your relationship with your real estate agent starts when you tell them you want to purchase a property, and ends once you’ve purchased that property. Or, if you have a property to sell, your relationship ends once you’ve successfully sold it. They can provide pricing advice so you don’t end up at a loss. That said, your relationship is purely transactional.
On the other hand, your relationship with your property management company starts the moment your property needs to be rented, and continues until the day you decide to stop your landlord duties. Property managers create custom management plans, which means they’ll spend time getting to know your goals. Since you’ll be working closely with your property manager, you’re more likely to “bond” with them.
#2 How They’re Paid
In general, real estate agents are paid a commission. This means that they get a cut from the properties they successfully sell. Meanwhile, property managers can be paid a flat fee, but more commonly, they get a percentage of the rent paid by your tenants. Since property managers are paid for their performance (if they fail to fill your vacancies, how are they going to get paid?), they have more incentive to maintain your property properly. In short, they’re aware that their pay is on the line.
#3 Their Requirements
Florida real estate agents need to have a high school diploma or GED. They must also complete a pre-license real estate course. The same applies to aspiring property managers.
State rules vary when it comes to whether or not real estate agents and property managers need to have a license. In Florida, real estate agents need to get a real estate sales associate license before they can sell a property for compensation. This is the same license that property managers need to manage rental properties.
Can a Real Estate Agent Manage a Rental Property?
Yes, real estate agents can perform property management-related duties. As you can see, the roles have very similar requirements. They need to have a high school diploma or GED, complete a pre-licensing course, and have a real estate sales associate license. Basically, as long as the real estate agent satisfies those requirements, they can be a property manager.
Do note, however, that state laws vary. For example, some states such as Kansas only allow real estate agents to be property managers if the property they’ll be managing is purely residential. That means they can’t manage commercial properties – to do that, they must obtain a real estate broker’s license.
Should You Hire a Real Estate Agent to Manage Your Property?
Although you can get a real estate agent to manage your rental property, that doesn’t mean you should. It should be mentioned that the main difference between the two is their field. Remember that a real estate agent’s main concern is selling, which means that property management is secondary to their priorities. They may be good at the selling game, but they may not have the experience to properly manage tenants, maintain your property, and more.
It would be better to work with an all South Florida property management company that has dedicated property managers who’ll do nothing but manage your rental. They have a wealth of experience in managing a variety of real estate investments, ranging from single-family homes to mansions. Unlike real estate agents who’ll likely be distracted by the tasks of their brokerage, they can commit their time to property management, nothing more.
Looking For All South Florida Property Management?
Speak with the staff at Luxury Property Care if you own an investment property that you want to be managed by the experts. As specialists in all facets of property management, we can guarantee that your rental will be well-maintained and cared for, and that its value will increase over time. By partnering with Luxury Property Care, you can expect your rental to be in capable and reliable hands. Call (561) 944 – 2992 or complete our contact form for more information.