About the time the foreclosure rate soared, I started getting calls from people looking for a home to rent. In fact, some have told me that homeownership is just too risky for them and that they may never own. The rental market in my area is just starting to heat up, while home sales remain slow.
There are people who believe that property management is the way to go for real estate agents who are looking for more business.
I don’t have any experience as a property manager and I have not been able to figure out how leasing agents can make enough money without also being property managers. Working as a property manager requires different skills than working in real estate sales.
Last year, rentals were added to our multiple listing service and there was a lot of excitement about it. Adding them makes sense. The housing market has contracted, agents are leaving the business to find other work, and most of us need more work. Some local agents started working with renters and property owners right away.
Unfortunately, some of them did not have any training or experience with leases. Agents became leasing agents because they could — not because they knew anything about it. Some did not bother with a business plan or even attempt to figure out if they could make a profit.
A few months after rentals appeared on the MLS, our state association sent out an email advising members to refrain from representing clients seeking out leasing agents until we had a firm understanding of how to represent them and how to correctly handle leases and other related legal documents.
The idea of using a real estate agent to find and rent an apartment in the Twin Cities market is fairly new. I get calls from people who would like to rent, and if I told them that I could help they would probably work with me.
In most cases I turn them away because I don’t know how to help them and make a profit, too. There are few rentals on our MLS and the commissions are small.
I would consider representing the property owner. It isn’t a stretch to advertise apartments for rent right along with homes for sale. It may not pay as well as selling a home, but properties in my market area these days do tend to rent much faster than they sell.
Property owners do not seem interested in working with agents. As the demand for renters increases, they have less of a need to work with us. If I were looking for a renter myself, I cannot imagine hiring an agent.
It does not cost much to advertise through the Internet, and being on the MLS isn’t much help because at this point there are few rentals on the MLS and it isn’t a go-to place for people looking for rentals like it is for people looking to buy a home.
There is still no single source on the Internet for apartments for rent. There are various services that have some, but not all, of the rental inventory.
The best way to find local rentals on the Internet is to look on Craigslist.org, the online rental section of the local newspaper, and on Trulia, among other online sites. I recommend Trulia to local renters because the site has a lot of rentals on it and its smartphone app is easy to use.
It’s difficult to gauge how many rental units are available in the Twin Cities because they are scattered around on a bunch of sites.
There are 10 to 12 apartments on the MLS in my area at any given time. People ask me how much it costs to rent an apartment and I don’t have an answer. I know a little about rental rates in my own neighborhood.
To date, only a small number of apartments have been rented through our MLS. The owners of the larger properties hire property managers and have no interest in working with local real estate agents.
It would appear that there is a demand for rental property but almost no demand for agents to represent property owners as leasing agents.
It is likely more cost-effective for the owners of larger buildings to handle the rental process on their own through employees responsible for managing the property.
A good real estate agent may not be qualified to be a property manager, and although there may be more work in the field in the years ahead I don’t think that all real estate agents are suited for property management or that we should just add it on to our list of services because we need more business.
Teresa Boardman is a broker in St. Paul, Minn., and founder of the St. Paul Real Estate blog.
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