Businesses extending past state lines comes with increased responsibilities and potential challenges that Treasure Valley property managers face every day. From constant, honest communication to navigating expectations and relationships, Idaho’s distant property owners represent unique situations for managers.
After the Great Recession hit the housing market in 2008, investors jumped on the supply of foreclosed homes to create a new market of distantly owned rental housing previously seen in much smaller quantities. This gave rise to the commonality of the out-of-state owner. This altered market has changed the face of home ownership and helped drive prices up for entry-level housing. Corporate landlords and distant owners are now a feature of the Treasure Valley’s frenetic housing market, and the distance between owner and resident brings unique opportunities and challenges for property management companies.
Recently, the issue of Idaho’s distant landlords has been widely covered. The New York Times ran an article about individuals and businesses in other states buying up large parcels of Idaho land and proceeding to close it off or change it in ways that make it inaccessible to previous recreation or business. Similarly, the Idaho Statesman has written about corporate landlords based out of California purchasing swaths of Treasure Valley homes and raising prices. For example, one Californian real estate company’s Treasure Valley properties jumped from 179 in 2013 to almost 500 in 2018.
Facing this change, Idahoans question whether outside ownership is in the state’s best interest.
But despite the controversy, the increase in non-local ownership is a reality. Property managers find themselves on the forefront of navigating relationships and building healthy, mutually beneficial businesses between these distant owners and their local tenants, but like any long-distance relationship, working with out-of-state owners comes with its own set of benefits and challenges for property managers in the Treasure Valley.
Benefits of out-of-state owners for Property Managers
Increased service value.
With the increase in out of state property owners, local management is a necessity. Property managers can care for and watch over real estate with a personalized and insightful touch that an owner in California or Washington might find undeniably valuable. Increased demand for property management services translates to increased revenue margins.
Wider market base.
More out-of-state owners means a broader base for property management services with a wider market base. Not only can these services be advertised to a larger market, effective businesses can spread the good word across state lines and network for potential expansion.
Challenges of out-of-state owners for Property Managers
Managing a property for an owner in another state means communication needs to be consistent and open. Since out of state owners cannot frequently come visit their properties, time for complete and honest updates must be scheduled for property managers who already have a lot on their plate.
With constant communication a must, property managers must find ways to manage staffing and scheduling so that tenants and owners have clear expectations of when and where they can reach their managers. This does not just mean contact—both parties will also need to have an accurate timeline for repairs, contact, visits and more. This goes for any property manager, but with the owners far away, trust in management efficiency should never come into question.
Clashing desires of owners and locals.
The Treasure Valley’s uniquely complicated relationship between locals and newcomers is something that may manifest in a property owned by an out-of-state company or individuals. Property managers have to be a middle ground between tenant and owner, providing the best experience for both and building business relationships. Implementing the will of an owner not around to directly see the effects of that change could present a challenge.
Despite the issues surrounding out of state owners, property managers stand to gain with business tailored to require their services with unique opportunities to provide a local touch and understanding. With the Treasure Valley’s massive influx of out-of-state residents, 80,011 in 2016 alone, it is important that property managers serve as a middle ground that can effectively run Idaho properties for owners and residents that come from another place.