Property/Rental Management in Los Cabos is an essential service for homeowners who own property in the area but do not live here year-round. Property/Rental Management providers offer various services to help homeowners manage their properties, including maintenance & repairs and rental management.
Property/Rental Management Key Services
There are 5 key services to Property/Rental Management in Los Cabos.
1. Property Management – monitoring your property when you are away, tending to repairs and maintenance, and bill paying (Electricity, Water, Phone/Internet, TV, HOA, Annual Property Taxes).
2. Check-In/Out – when renting, you will need someone to coordinate check-ins and check-outs. Key codes and WIFI-enabled door locks are changing this, but you still need someone to check the unit on departure.
3. Cleanings – having cleaning crews and coordinating their activity is important to maintaining a busy rental calendar.
4. Rental Management – this is the active management of marketing, taking bookings, managing online accounts, screening clients, collecting deposits & payments, managing schedules and handling renter concerns and complaints.
5. Concierge Services – this is important but not essential to your rental goals. Concierge services are a great extra that gives renters a one-stop person to organize excursions like whale watching, zip lining, fishing, dinner services, transportation, and other tourist activities.
Property/Rental Management Key Players
There are 4 key players in Property/Rental Management in Los Cabos.
A) Owner – as the owner, you can participate in the management of your property or hire out parts or all of the key elements.
B) Property Manager – an individual or company you hire to perform property management activities and may provide other services.
C) Rental Manager – an individual or company you hire to perform rental management activities and may provide other services.
D) Full-Service Manager – an individual or company you hire to perform all rental and property management activities.
Common Property/Rental Management Circumstances
Basic Property Management – You’re a snowbird spending winter in Cabo, or you like to come and go year-round when the mood strikes you. Basic property management is your best option to ensure your home is checked on, bills are paid, plants are watered, and maintenance is performed. Depending on your home’s needs, this will run approximately $125 USD to $250 USD per month. For some owners, you may wish to find a property manager with access to a cleaning crew to ensure your property is dusted while you are away and cleaned before and after your stay. Depending on your property, cleanings will typically run $40 USD to $100 USD per cleaning.
Owner Managed Rental with Property Manager – Many owners like holding the keys to online accounts, setting prices, screening candidates, and developing a more personal relationship with their clients. Doing this well requires a property manager who can handle basic property management and provide check-in/out and cleanings. Many who provide this will be well-connected locals with cleaning crews and a network to meet all your concierge needs. Fees for this will be per month for basic property management (as above) and per event for check-in/out and cleanings. Cleaning costs are typically passed on to renters.
Rental Manager with separate Property Manager – Many Rental Managers are exceptional at marketing your property, setting prices, screening candidates, and creating a wonderful vacation experience for their clients. These Rental Managers will run their cleaning crews and have staff perform check-ins/outs. They will also have solid reputations and local connections to meet concierge needs. Property Management may not be the strong suit for some Rental Managers, so a separate property manager may be needed to cover basic property management needs. Sometimes owners who decide to rent their property will have allegiance to their long-standing Property Manager and will favor continuity. They will keep them on and have the Rental Manager work with the Property Manager. Sometimes this may not work well when the Rental Manager is getting calls about a problem with the property in the evening or on the weekend, and the Property Manager is unavailable to help. This issue lends itself to having a Full Service Manager with all responsibilities with one party.
Full-Service Rental & Property Manager – Full Service operators combine all elements for a turn-key service, so owners and clients only have one party to turn to. Full-Service operators have exceptional marketing skills, optimal price setting, quality candidate screening, and top-level concierge services. They run their own cleaning crews and will have staff to perform check-ins/outs. Having a Full-Service Manager ensures all responsibilities with one party and rental clients’ needs are met swiftly when there is a problem with your property.
Fees for Full-Service Management are typically a percentage of the rental revenue (i.e. 25%) that will likely include check-ins/outs. Cleanings may be per event and sometimes passed on to renters or included in the revenue percentage. Fees for Property Management may be per month as above or included in the revenue percentage.
ON-SITE Full Service Rental & Property Manager – On-Site Full Service Management does all the same things as Full Service Operators. It can typically be found where Branded Luxury Residences are. On-site programs may be more robust and include discounts and preferential access to on-site Restaurants and Spas for treatments and other higher-end details. On-site programs typically operate as the sole rental operator at the resort. They may come with restrictions on décor and take furnishing replacement out of the hands of the owner. This is all to provide a particular “Brand” experience.
Fees for On-Site Full Service Management are typically a percentage of the rental revenue (i.e. 35%) that will likely include check-ins/outs. Cleanings may be per event and sometimes passed on to renters or included in the revenue percentage. Fees for Property Management may be per month as above or included in the revenue percentage.
On-site programs also often offer tax-efficient structures that ensure the owner’s rental income taxes are taken care of to ensure a hassle-free experience.
LEASE BACK PROGRAM – Operators of On-Site Full Service Management may offer a Lease Back program. A Lease Back program typically involves the resort operator taking full control of your property and renting it out as they see fit, maximizing rental income to their own benefit. In return owners are provided with a guaranteed monthly revenue stream and a certain amount of access to the unit (ie 4 weeks per year). There may be other benefits such as additional access to the unit by the owner at reduced rates or access to other units in the resort at reduced rates. Like many other on-site programs there may also be discounts and preferential access to on-site Restaurants and Spas for treatments and other higher-end details. On-site programs typically operate as the sole rental operator at the resort. They may come with restrictions on décor and take furnishing replacement out of the hands of the owner. This is all to provide a particular “Brand” experience.
Lease Back Programs may also often offer tax-efficient structures that ensure the owner’s rental income taxes are taken care of to ensure a hassle-free experience. Lease Back Programs may also be offered in conjunction with Developer financing with the monthly lease revenue going towards the loan payment.
The developer of Porto Novo Residences is offering a Lease Back Program.
About Rental Income Taxes
As Los Cabos Real Estate Agents, we get to speak to many aspects of real estate. We are not tax experts and do not offer advice on rental income taxes. Mexican taxes on rental income are a important point for all investors to become educated on. Familiarize yourself by finding a local tax accountant who can advise you on complying with state and federal regulations in Mexico.
Read more about Rental Income Taxes here: Tax Obligations on Vacation Rentals in Mexico.