Property management and real estate: is it the same?
Realtors and propertymanagers can be easily confused, but even thought both are
part of separated industries, they are tightly connected and have lots of similarities.
Let’s start with what they have in common.
Things property management and real estate have in common
They both deal with housing.
Real estate deals with the purchase and selling of houses while property management deals with taking care of everything related to the property, including maintenance, repairs, tenant issues and more.
They both could offer property management services.
A lot of real estate agencies offer property management services, although there are some significant differences in their focus. While real estate agents offer the management of the properties as a secondary service, property managers focus solely on managing the property and making sure the investment is protected.
Some countries require property managers to get a real estate license.
Differences between property management and real estate:
Real estate is a transactional business while the management of properties is a contractual business.
Real estate basically starts and ends with the purchase of a property while property management implies an ongoing contract, where the property management company receives a monthly fee for taking care of the property.
For a property management company, managing the property is a priority.
Property management companies has management of the properties as a priority and it also has specialized experience to do so. Meanwhile some real estate agencies offer those services as a secondary business.
Realtors and property managers have different duties.
What does a real estate agent do?
A real estate agent connects buyers and sellers for transactions and acts as representative in legal negotiations. They usually work through commissions (which could be a percentage of the sale).
The realtor works with clients to find them a property or works with people that want to sell their property. They have the duty to summit offers and to negotiate, meeting and understanding the needs of their clients and demonstrating their market knowledge, abilities and negotiation skills.
They work with sellers, researching the current local market activities and listing the property. They also establish an asking price and conduct open houses.
With buyers, real estate agents work researching the listing services for potential properties that fits the needs of their clients and they show the property for buyers and communicate details of the property to the owners.
What does a property manager do?
Property managers are in charge of managing every detail of a property. They act as a local presence for the owner, take care of administrative duties such as handling tenants’ contracts, processing rental applications and more. Also, they are in charge of handling maintenance and repair requests.
Property managers’ mission is to take care of the properties they are in charge of, needing sometimes to acquire technical knowledge and to communicate with tenants and maintenance providers. They also have a good knowledge of the law, knowing how to handle every problem within applicable law boundaries.
Both industries are not the same but they are complementary businesses, allowing real estate agencies to offer secondary services.
Are you looking to partner with a property management company? Contact us.