Mindful Capital Group believes that there is a clear difference between real estate asset management and property management. This article will highlight the differences so you are familiar with both.
Hiring a real estate asset manager is a natural step for rental property investors. Oftentimes investors confuse property management with real estate asset management. And oftentimes many wonder whether there’s really a need for the two different professionals.
Property and asset managers play two very different roles, and the most successful investors find there is a need for both of the two. Rental property investors who use a real estate asset manager can earn higher profits and stronger portfolio growth.
A real estate asset manager monitors the market. They keep their finger on the pulse of the latest real estate trends, and stays on top of political and financial trends. The best real estate asset managers understand the nuances of each client. That’s because each investor is unique. When it is all said and done, a professional real estate asset manager can provide a priceless perspective to rental property investors who may be too busy with work to fully appreciate the profit potential of each asset in the portfolio.
What are the Differences?
A property manager focuses on the day-to-day operations of a rental property while an asset manager is concerned with the long-term, bigger financial picture. As rental property investors scale up their real estate portfolios, it becomes increasingly important to include a real estate asset manager as a key part of the team.
Here we highlight the differences between real estate asset management and property management:
Property managers deal with the daily routine, and daily activities of managing rental properties. Key responsibilities of a property manager include finding and luring new tenants, holding on to the valuable tenants you already have, executing leases and enforcing the terms and conditions. This includes collecting rents, paying vendors, maintaining the property, and providing monthly and year-end financial reports to the owner.
Asset managers focus on the long term. It is their job to maximize the value of each rental property and realize the highest return on investment for the owner.
Key tasks and responsibilities of an asset manager include creating an overall strategy for each rental property and the entire real estate portfolio, improving asset value by wisely reducing expenses and increasing income, hiring and overseeing the property manager; and preparing, monitoring, and adjusting property financial projections and financing strategies.