Why Managing Your Own Properties is (Almost) Always a Huge Mistake

Why Managing Your Own Properties is (Almost) Always a Huge Mistake

3 min read
Sterling White

Sterling White is a multifamily investor, specializing in value-add apartments in Indianapolis and other Midwestern markets. With just under a decade of experience in the real estate industry, Sterling was involved with the management of over $10MM in capital, which is deployed across a $18.9MM real estate portfolio made up of multifamily apartments. Through the company he founded, Sonder Investment Group, he owns just under 400 units.

Experience
Sterling is a seasoned real estate investor, philanthropist, speaker, host, mentor, and former world record attemptee, who was born and raised in Indianapolis. He is the author of the renowned book From Zero to 400 Units and the host of a phenomenal podcast, which hit the No. 1 spot on The Real Estate Experience Podcast‘s list of best shows in the investing category.

Living and breathing real estate since 2009, Sterling currently owns multiple businesses related to real estate, including Sterling White Enterprises, Sonder Investment Group, and other investment partnerships. Throughout the span of a decade, he has contributed to helping others become successful in the real estate industry. In addition, he has been directly involved with both buying and selling over 100 single family homes.

Sterling’s primary specialities include sales, marketing, crowdfunding, buy and hold investing, investment properties, and many more.

He was featured on the BiggerPockets Podcast episode #308 and has been contributing content to BiggerPockets since 2014, with over 200 posts on topics ranging from single family investing and apartment investing to mindset and scaling a business online. He has been featured on multiple other podcasts, too.

When he isn’t immersed in the real world, Sterling likes reading motivational books, including Maverick Mindset by Doug Hall, As a Man Thinketh by James Allen, and Sell or Be Sold by Grant Cardone.

As a thrill-seeker with an evident fear of heights, he somehow managed to jump off of a 65-foot cliff into deep water without flinching. (Okay, maybe a little bit…) Sterling is also an avid kale-eating traveller, but nothing is more important to him than family. His unusual habit is bird-watching, which he discovered he truly enjoyed during an Ornithology class from his college days.

Education
Sterling attended the University of Indianapolis.

Follow
LinkedIn
Facebook
Instagram @sterlingwhiteofficial
YouTube
SterlingWhite.info

Read More

As a Guest you have free article(s) left

Join BiggerPockets (for free!) and get access to real estate investing tips, market updates, and exclusive email content.

Sign in Already a member?

Being a landlord seems to be the go-to for many real estate investors new to the game. However, I can’t stress enough that from my personal experience, this has been the worst decision that I ever made as a real estate investing newbie. This is simply because now that I have been able to witness it firsthand, I can finally understand exactly how much work, effort, and sweat goes into managing your own property. Therefore, trust me when I say that I am totally convinced that this so-called “passive source of income” is far more active than it seems.

Time is Scarcer Than Gold

Managing a property all by yourself without the help of a property management company will occupy so much of your time, and the thing is, the amount of time that you put into chasing after rent, screening for potential tenants, and fixing the broken sink, you could easily have used to either educate yourself, perform research, or invest in new properties. So while you might be able to save money managing the property firsthand, you will be losing time, which is your most precious asset. Sadly, time is often placed on a lower pedestal to wealth. However, it is important to keep in mind that while you can always generate income, you can never make more time.

estimate rehab costs

Related: Investors: Believe Me, You CAN’T Afford Property Management. Here’s Why.

Living Life Like a Medical Resident

If you want to take on life as a landlord, you will have to brace yourself for some tough times ahead. You have surely heard stories about terrible tenants who completely destroy your home or run off without paying, getting evicted and so forth, but the truth of the matter is, even good tenants can be a real handful!

If you are the landlord, if the sink decides to play up during dinner time, who will the tenants call? You. If you are the landlord, if the electricity suddenly goes out in the middle of the night, who is in charge of fixing it? You. Every little problem with the property is always the landlord’s responsibility. So essentially, being a landlord means that you will always be on call — day in and day out. There is no holiday or designated “break time” for you, as you never know when a problem will suddenly occur.

Still don’t want a property manager/management company to handle all the ups and downs for you? Well, be prepared to embrace being the first one who gets a phone call, even if it means interrupting your much-needed beauty sleep at two o’clock in the morning.

The Nice Guy Syndrome

The truth of the matter is, being a landlord requires guts. You have to be strong, persistent, and (almost) mentally unbreakable. However, the vast majority of us probably relate more to the everyday “nice guy” — as in, you’ll far prefer being an understanding landlord than one who enforces rules with a mighty fist if they ever come head to head with a difficult situation.

For example, imagine having a tenant whose lived in your rental for the past three months who suddenly loses their job — and their mother just passed away. They ask you to let them stay and promise to pay you back once they find a new job. However, four weeks pass, and they haven’t found a job yet. Tell me, what do you do? Sure, it might feel good to play the nice guy, and you might not have the heart to insist that they move out, but being a landlord involves making tough choices — even ones that you don’t like.

Getting Organized Will Make You A Better Investor

Related: 80 Smart Questions to Ask BEFORE Hiring Your Next Property Management Company

Remember, this is a business so you have to treat it that way. If you don’t have the heart to play the “bad cop,” then let the property manager/management company handle it. It will take a huge load off your mind (literally).

All in all, being a landlord isn’t a bad thing per se, but it isn’t something that you should leap into without some prior education. It is mentally tough, time consuming, and requires a whole lot of DIY. So if that doesn’t sound like something you’re into, then don’t jump on the landlord bandwagon, and instead, try looking into some other options that are available out there!

We’re republishing this article to help out our newer readers.

blog ads 02

Investors: Do you believe in self-managing your properties or hiring it out? Why?

Let me know with a comment!