Balancing The Line Between Business And Personal Relationships As A Landlord | Nexus Property Management® Franchise

16 April 2024

THERE’S ONE BEST WAY TO INSULATE YOURSELF FROM GETTING TOO CLOSE TO YOUR TENANTS

It’s undoubtedly important that tenants feel valued and respected. Ultimately, the goal is for them to genuinely feel like the unit they’re renting is their home. In this way, they take pride in their space, keep you in the loop when there are maintenance needs, and go above and beyond to take care of the property. It’s a perfect example of the win-win relationship Nexus Property Management® is always trying to create.

But…fostering this relationship and maintaining boundaries isn’t as easy as it might seem. Or perhaps it’s more accurate to say: Fostering this relationship very often comes with the unintended consequence of blurring the lines between the personal and all important business relationship at the heart of owning rental property. You want to take care of your tenants as best you can and in doing so you inevitably build a personal bond. That’s great!…until it isn’t.

THE HARD DECISIONS

Eventually, you need to make business-first decisions, and these are always more difficult if you’ve formed a personal friendship. What will it look like when you need to tell this person that you’re not going to provide a maintenance upgrade that they’ve requested because it doesn’t make financial sense on your end?…or… are you just going to spend the extra money to avoid the conflict? How will you initiate the conversation when it’s time to raise the rent $150 to keep up with the market and your increased expenses? All too often we run into properties with rents that are waaaaaay below where they should be and everytime we ask about the tenant, the owner will tell us he or she is really great and really likable. What if that great, likable tenant stops paying rent? Are you going to be able to evict them? Strong relationships are very important but become a liability if they inhibit your ability to meet your financial goals.

LEARN MORE: THE BEST LANDLORDS CULTIVATE RELATIONSHIPS WITH THOSE IN THE PROPERTY MANAGEMENT SPHERE

YOU NEED A BUFFER

The closer landlords get to tenants, the harder it is to remember that owning a property is a business. And even if you don’t become best friends, the fact that you’re fielding every phone call, text message, and email whenever there’s a question about the lease, or a service request, or if someone’s car is blocking them in…you become their personal lifeline. There’s one best way to continue to be highly responsive and offer a high-quality place to live while still meeting your financial goals without putting yourself in this position: you need a buffer.

You need a middleman (middle person) and the best way to achieve that is by hiring a professional property manager.

LEARN MORE: RESEARCH SHOWS MOST PROPERTY MANAGERS ARE PRICELESS, LITERALLY!

UNIVERSAL TIP TO SUCCESS: ‘AVOID SURPRISES’

It’s a biological fact that humans prefer predictability. Anxiety and conflict rose to new heights during the early weeks and months of the pandemic because people don’t like to feel unsure of things. In the same way, people don’t like surprises and so much of success in a service industry comes down to your ability to be transparent and effective in setting realistic expectations. In our eyes, if a client is upset because of sticker shock, we need to think about how we could’ve better prepared them for the reality of the issue and of property ownership in general.

So here’s the issue when you create a strong bond with your tenants: People mistake friendliness for leniency. The key to successful property management lies in your being fair and firm, but firmness in a personal relationship is not as well received. Firmness is instead inconsistent with more typical dialogue and you’ve misled your tenant in terms of what they can expect from you. Whenever possible, avoid surprises. Whenever possible, avoid being in a position where personal and business relationships intersect.

LEARN MORE: THE SECRET ABOUT THE MOST SUCCESSFUL PROPERTY MANAGEMENT CLIENTS

KEYS TO HIRING A REPUTABLE PROPERTY MANAGER

There are more and more property managers out there and many of them will offer different services and will specialize in different areas of real estate. Be wary of property management companies that cast too wide of a net. For example, a brokerage or realtor that buys and sells properties and also manages property is not going to be fully dedicated to your long term goals because sales commissions will be their priority. Too many revenue streams or an imbalance in return size means too little focus geared toward all clients. Instead, find a property manager who specializes exclusively in leasing and managing rental properties.

You’ll also want to compare local PMs’ pricing structure. Companies that offer too-good-to-be-true pricing are likely not going to be able to deliver the full services needed to succeed in real estate investment. Those that offer three or four different pricing tiers are typically just playing marketing games to get you to pay extra for what other companies include without cloaking it in perceived savings.

At Nexus, we subscribe to the power of transparency and honesty in communicating with potential clients. Nexus Property Management® is a national franchise with five offices across the country but we operate as five individual Regional Property Management Companies. If you’re interested in learning more about Nexus’ services, contact any of our teams across Arizona, Connecticut, Massachusetts, and Rhode Island.

LEARN MORE: CAN YOU EFFECTIVELY MANAGE PROPERTY WITHOUT HIRING A PROPERTY MANAGER?

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Mick Lefort is the General Manager of Nexus’ New Haven County Franchise Office and the Vice President of Operations for Nexus Property Management®, a National Property Management Franchise that manages all types of rental property from single family homes or condos to large apartment buildings and complexes.

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