Save $66,000 Per Year On Property Management

Outsourcing property inspections has become a common practice for many real estate companies. However, this task can be divided into two categories: either the property inspection service provider conducts the inspections and passes on the information for the property management company to prepare the reports or the entire process, including inspections and reports, is done by the property inspection service provider for the property manager to forward to rental property owners.

On average, outsourced property inspections cost around $55 per inspection. This means that a property management company managing 300 doors and conducting four inspections per year would pay $66,000 annually to outsource property inspections. However, this figure is more than the average cost of a property manager's salary, which makes outsourcing inspections 60% more expensive than paying a property manager to conduct inspections.

Moreover, outsourcing inspections can create more risk and lead to client loss. Property managers have a duty of care to be across every property in their portfolio at all times, and outsourcing inspections can make them out of touch with properties. The property manager cannot provide advice about a property's market relevance, demographic appeal, upkeep, tenant suitability, and rental return if they have not personally inspected the property. Additionally, if concerns arise during the inspection, the property manager may not have first-hand knowledge of what is necessary to remediate or rectify the issues.

Outsourcing property inspections provides no value to the property management business or clients. The need to outsource usually arises from a lack of operational systems, which should manage property managers' workload and workflow. Without systems in place, property managers may not have enough time to conduct inspections, resulting in the task being outsourced.

Therefore, we believe that outsourcing property inspections is not beneficial to real estate businesses. The tangible and intangible costs, through potential business loss and liability, outweigh the benefits. It is essential to have operational systems in place to manage property managers' workload and workflow and ensure that they can carry out inspections themselves.