Advice from seasoned professionals in the property management industry.

8 Replies

I will try to keep this post/ question short and concise. My love for multifamily investing it growing every day. I love studying my market and sub markets. Analyzing deals. Talking to everyone I can about my love for real estate. I realize that property management will either be the bane or salvation of a solid investment deal. Because of this, I am opting to in-house PM rather than "out-house" property management( thank you Syrios Bros!). My goal is to not only manage my own eventual large portfolio of properties but also other investor's properties for a fee. I will transform the PM industry in my local market for the best. I will offer a superior service and build THE trusted name in PM first in my community and then all of the thriving surrounding markets. I will build a company synonymous with quality PM. I am earning my RE License this year. I will be going for my brokers license three years after obtaining my RE license per South Carolina law. I currently work a dead end job in the agricultural industry. I need to make a transition. I am strongly considering applying to a PM company in my area to learn the ropes. With so many bad companies out there, I fear learning the wrong way to do things in the industry. In your experience should I take the leap and do what I can to make the PM company I end up working for great while learning? Also, will the commercial lenders see me working a W-2 job and having a working knowledge of the industry as a plus and possibly sway them even more into underwriting a financially sound investment? Thank you in advance for your consideration and advice.

Good luck @Matthew A Rodriguez with your endeavors. I'd say definitely go work for a large (and reputable) PM company. Make  your face the face of that company as much as you can. This will take time as you will likely start off in a lower office position but work your way up. Who knows what will happen. You may end up buying the company you work for or if they start to fall down, you will have a list of clients (unsatisfied) that you can take with you when you go off on your own. Clearly you don't want to go into it with the plan to learn the business then steal all of their customers but knowing the current owner's end game would be important from the beginning. Is there anybody else up the ladder that might want to take over?

As far as your experience, when it comes to portfolio lenders (smaller local banks) experience is very important and being in the real estate business when you purchase your first property will be a big help. It won't matter so much with larger lenders like BofA or Chase as you are just a credit score to them for the most part. 

Thank you Rob. I appreciate your thoughts. I'm sure the PM company I do land with will have me sign a non-compete agreement. I fully understand that. My goal is to become the face of the industry. I want to revitalize this slacking area of real estate and become an asset not just for the owners of the community but to every tenant that lives in that community. I've been a apartment dweller all my life and I see the lack of professionalism, dedication, and love for the job. I want to make a difference is what it boils down to.

Great plan! There are so many sub-par managers out there it amazes me that they can get clients at all.  Double check SC laws regarding licensing and working relationships of managers.  I'm a PM / Lic Real Estate Sales Assoc in FL and I have to work under a broker (I happen to work for a PM company with a fabulous broker/manager, and I'm learning SOOOO much).  There are many flat fee brokers not in PM that will take you under their license to do management, just understand your State requirements before you do something that could jeopardize your your future goals by inadvertently getting slapped on the wrist or fined by your licensing body.  In FL practicing 'real estate' without a license is a 3rd degree felony with up to a $5K fine...kinda scary!

I'm in your boat regarding the W-2 issue which is why I'm working my way up in the PM world while investing on the side.  I have an amazing credit score, but until this spring I worked as an independent contractor in another industry and I've had 'stated income' for 10+ years.  Before the crash I could blink and a big bank would lend me money...not so simple any more.

Great advice concerning the legalities. Thank you Rondi! Something I need to conduct proper due diligence on and run by my RE attorney possibly. Ignorance is not bliss and can unfortunately destroy some unprepared and unsuspecting people.

This post has been removed.

Originally posted by @Rondi Frisch :

Great plan! There are so many sub-par managers out there it amazes me that they can get clients at all.  Double check SC laws regarding licensing and working relationships of managers.  I'm a PM / Lic Real Estate Sales Assoc in FL and I have to work under a broker (I happen to work for a PM company with a fabulous broker/manager, and I'm learning SOOOO much).  There are many flat fee brokers not in PM that will take you under their license to do management, just understand your State requirements before you do something that could jeopardize your your future goals by inadvertently getting slapped on the wrist or fined by your licensing body.  In FL practicing 'real estate' without a license is a 3rd degree felony with up to a $5K fine...kinda scary!

I'm in your boat regarding the W-2 issue which is why I'm working my way up in the PM world while investing on the side.  I have an amazing credit score, but until this spring I worked as an independent contractor in another industry and I've had 'stated income' for 10+ years.  Before the crash I could blink and a big bank would lend me money...not so simple any more.

 Rondi,

What do you need to be PM in FL? do you have to be a realtor, broker, or any special certs?

Originally posted by Aaron T.:
Originally posted by @Rondi Frisch:

Great plan! There are so many sub-par managers out there it amazes me that they can get clients at all.  Double check SC laws regarding licensing and working relationships of managers.  I'm a PM / Lic Real Estate Sales Assoc in FL and I have to work under a broker (I happen to work for a PM company with a fabulous broker/manager, and I'm learning SOOOO much).  There are many flat fee brokers not in PM that will take you under their license to do management, just understand your State requirements before you do something that could jeopardize your your future goals by inadvertently getting slapped on the wrist or fined by your licensing body.  In FL practicing 'real estate' without a license is a 3rd degree felony with up to a $5K fine...kinda scary!

I'm in your boat regarding the W-2 issue which is why I'm working my way up in the PM world while investing on the side.  I have an amazing credit score, but until this spring I worked as an independent contractor in another industry and I've had 'stated income' for 10+ years.  Before the crash I could blink and a big bank would lend me money...not so simple any more.

 Rondi,

What do you need to be PM in FL? do you have to be a realtor, broker, or any special certs?

In FL to be a PM you must have a real estate sales associates license and work under a licensed broker or be a broker yourself.  There are some certification course you can take, but the State doesn't require those and they are not a substitute for the real estate license.  In FL the act of showing a property for lease is considered "practicing real estate" under the statute if you do it for compensation (ie, not a property the you personally own).  

@Matthew A Rodriguez , I appreciate your ambition. Most of us involved in REI started as you are and realized that what we were building would take more than an "employee" effort. Own your future. Register a business. Create your plan. Structure yourself as a brand to everyone you engage with so that you'll know how to discern the best from the rest for your business. This way everything you do for your business will generate credit, present professionally and work to your future advantage. The benefits of owning your own LLC or S Corp far outweigh the costs, and if you can't support the basic business structure then you may not benefit from the business you're trying to generate.

Get properly educated by someone that can see the business from multiple angles and has mastered the multifamily market in your area. Networking is as important as anything else you will endeavor to accomplish because rarely is what we do "NEW" to everyone... someone else has most likely done it before and is doing it better. Don't reinvent the wheel, just work on cultivating the vehicle on which the wheels rest!

If you'd like to contact me I can provide you with some resources to accelerate your planning and training; these are folks who have been there, done that and can insure that you are prepared to tackle the business well.

KC

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here