In an economic twist, residential management companies actually saw some of their best years when the real estate market slumped in the late 2000s and early 2010s.
Those were the days when residents lost their homes to foreclosures and wound up renting houses, townhomes or condos. Even later on, many former homeowners weren’t permitted by law to buy a home for at least three years. In other cases, financially strapped owners avoided foreclosure but moved out of their houses and relocated temporarily to leased property.
Gradually, past house holders are buying new properties and moving out of leased homes and multifamily locations. It would seem that would leave a shortage of rental customers, but that trend hasn’t materialized in a big way as Charleston’s vibrant economy draws in new customers — for the most part, people moving to the area with new jobs who rent for a year or more.
“For us, as managers, we are picking up single-family homes,” says Hayden Jennings, broker-in-charge of Hayden Jennings Properties in Charleston. The firm boasts at least 200 properties that individuals or partnerships own as investments, as opposed to apartment complexes or entire condo or townhome communities.
The managed rental listings are primarily in Daniel Island, downtown Charleston and larger residences on Mount Pleasant and in the Park West area, along with a smaller number of properties west of the Ashley, Jennings says.
“I would say demand is moderate,” notes Eric Wetherington, who heads Carolina One Property Management. The business, which oversees 1,000 homes, has leveled off a little bit but not a lot, he says.
Wetherington agrees that individuals and families relocating to the Charleston area for new jobs prop up demand and counterbalance the recent slide in the number of traditional homeowners who were forced to rent because they lost their houses.
“More people are coming from out of town,” he says. “Jobs are shifting.”
Single-family rentals tend to be strongest in Mount Pleasant, with Goose Creek, Ladson and Summerville additionally counting investor-owned condos and townhomes, Wetherington says.
While incoming executives and employees make up a sizable total of property managers’ business, sometimes the professionals take over from single investors who decide the job of overseeing maintenance and collecting rent proves too taxing.
“We picked up several who backed out because people owed rent,” Jennings says.
Property management companies often work as a wing of a larger real estate company that also buys and sells homes. That can lead to sales business when tenants move out and are ready to buy a house. “We definitely connect a lot of our tenants (with sales) representatives,” he says.
Wetherington, who launched the property management division of Carolina One Real Estate in 2009 around the bottom of the real estate sales market, says his staff works with Realtors from the parent company. “When (investors say) we don’t want to be in the landlord business, we can get (them) a home, too,” he says.
Looking ahead, the property managers are reasonably optimistic about the business’ future. “I think rents are going to stay flat in 2016,” Wetherington says, adding that demand likely will remain similar to this year.
Jennings, meanwhile, anticipates a surge in lease prices next spring driven by increasing demand from prospective tenants getting ready to move in by summer to ensure their children enroll at the schools they desire.
Jennings sees a growing area for Hayden Jennings Properties will be the leasing of bed-and-breakfast-like properties reserved online, in which people lease for a weekend, week or other short time frames. Such arrangements are only allowed now in a small part of downtown Charleston: He says the company is involved with a few properties.
He also expects the influx of tenants and investors to continue next year in the traditional property management business. Geographically speaking, “I would say a lot (of newcomers) are from the Northeast — New Jersey, New York, Connecticut. Another 100 inches of snow in Boston, you’ll get a lot more people,” he says.
Reach Jim Parker at 937-5542 or email@example.com.