Owning rental properties in Memphis, TN can be a lucrative venture, with average rents around $1200 and low vacancy rates (says The Luxury Playbook). However, property maintenance is a key responsibility that requires careful management. Many landlords hire rental property management services to handle day-to-day tasks, including repairs.
However, a common question arises: Do property managers pay for repairs, or is that the landlord's responsibility? The answer depends on the management agreement, the type of repair, and the property owner's preferences.
Here's a closer look at how repair costs are typically handled in Memphis.
Understanding the Role of a Property Manager
Property managers act as intermediaries between landlords and tenants, ensuring that the property is well-maintained, tenants are satisfied, and legal requirements are met. They will also market the property when looking for tenants.
Their duties often include:
- Coordinating repairs and maintenance
- Handling tenant complaints and requests
- Inspecting the property for issues
- Managing budgets for property upkeep
Although property managers oversee repairs, they don't typically pay for them out of pocket unless specified in the management agreement. Instead, rental repair costs are usually passed on to the landlord.
How Repairs Are Typically Handled
In most cases, landlords are responsible for covering repair costs because they own the property. Common examples include:
- Fixing structural issues like roof leaks or foundation cracks
- Repairing major systems such as HVAC, plumbing, or electrical
- Addressing safety hazards like broken locks or faulty smoke detectors
Rental repairs responsibility falls upon the property manager's shoulders, who will typically assess the issue, hire contractors, and coordinate the repairs, but the landlord is billed for the expenses.
Property Manager Expenses
Some property managers may have petty cash or a designated repair fund provided by the landlord. This allows them to handle minor repairs or emergencies quickly, without waiting for owner approval.
The Rental Property Management Agreement Matters
The specifics of who pays for repairs are outlined in the property management agreement, a legal document that defines the relationship between the landlord and the property manager. Here are some key provisions to look for.
Repair Limits
Many agreements include a spending cap, such as $200-$500. For repairs below this amount, the property manager may authorize the work without consulting the landlord. Repairs exceeding the cap require owner approval.
Emergency Repairs
In cases of urgent repairs, the manager may proceed immediately to prevent further damage. This is even if costs exceed the limit.
Preventative Maintenance to Reduce Costs
Good property managers prioritize preventative and property maintenance in Memphis, which reduces the need for costly repairs. Routine tasks include:
- Regular inspections to identify potential issues
- Ensuring systems like HVAC are serviced annually
- Addressing tenant-reported issues promptly to avoid escalation
By staying proactive, property managers can help landlords save money in the long term.
Hire Property Management Services to Make Your Life Easier
Repairing, maintaining, and taking care of rental properties can be quite a headache, so if you wish to free up some of your time as a landlord, consider hiring a full-service rental property management service.
PMI of Memphis brings over 100 years of combined property management experience and a full understanding of the Memphis real estate market. Let us help you make your rental property business more profitable and less risky.
Contact our team today.
