@LaShon Evans hello and great question. I have seen all sides of this equation, self managing my own properties locally, but moved with the Navy 1000 miles away and managed the same rentals from afar, and had friends here in Memphis that had 18 properties and had them all with PMs with varying levels of success, some bad and some great.
Self-managing brings about an additional level of responsibility that most of the time is fine, but that is not what you hire a PM for. You hire a PM to deal with the home when it is inconvenient and a hassle. Today, for example, I had to leave work to run a toilet to my plumber because when he took off the old one, someone had done a hack job on the remodel plumbing and damaged the flange and we actually needed a smaller toilet than was on it (10" instead of a 12"). As I was driving and not doing my daily job, it gave me some time to reflect on how much time I could get back for a seemingly small amount each month. I value my time more than $50/hour and just this week I have spent 3 hours running toilets around which is what my PM fee would have been.
What else I learned was even if you have friends in the area, or even family, while they say no problem, as we get older we all value our time and it doesn't always feel right asking them to do stuff without compensation or with, but it is always tricky to work that relationship when they don't meet your expectations.
Transitions are also complicated and the screening and rental process can be burdensome. Sometimes you will have that next person/family lined up and ready to go, but sometimes it takes much longer and you need do renovations or at least some repairs. Every time that happens someone needs to be there unless you have a system in place to manage access from afar. Those systems also need maintenance from time to time. Even though we paid our friend to show our houses we always felt like we were putting her out of it was lots of showings and we're often resentful if it was a one and done. We had an agreement and stuck to it, but there were often some rifts that didn't feel good.
Are PMs perfect? Nope. Do they have systems in place that will make your life 99% easier? Yes, at least the good ones do. Will it cost more? Yes! But if you are an OOS rental simply for the cash flow, you will likely be disappointed. The real power of single family residential comes with stable, consistent markets that chug along, have good rental base/demand and growth potential.
There are lots of markets that meet this criteria and you will find PM companies of all sizes in those markets.
Something to consider maybe using one of these companies to help find a house, refine your process by example of what they are doing, then taking over management for a year and seeing how it goes. Try a resident turnover, if it doesn’t go so well then you can go back to the PM. Make sure you get into a property than can support both options. If you don't feel confident that you can find that on your own, reach out. If you have any additional questions about this I am available for any and all of them! I hope this was helpful.
Jared ,
Jumping in here just to say that your response here was so informative, and incredibly useful. I'm newbie myself to REI , I own my my own home but I'm now very interested in buying an out of state long term rental. NJ , where I am is extremely expensive. The Question posed here , is something I thought to myself quite a bit, and you really nailed the answer. It makes a lot of sense. So thanks for contributing because you have helped more people than you know!
my next step is to find the best and most affordable market for my investment!
