Hi everyone I just had a thought yesterday. Would it be a good or bad idea to hand over the responsibility and tenant interaction to a property management company if all i have is a 4 unit multifamily, one apt of which I'm currently living in? I closed on the place a few months ago and have showed it about a dozen times without finding a qualified tenant. My thoughts are that a property management company would have the years of experience and knowledge to properly find tenants, manage paperwork and handle repairs more effectively than i could which would mean a better experience for the tenants overall. This would also help me kick start my path to purchasing more rental properties by freeing up my time and focus.
Am i thinking about this all wrong? Should i just focus on filling and managing the few units that i have for now, or should i be thinking ahead and let the pros do what they're paid to do? Any thoughts or experiences with this that you could provide would be much appreciated!
Managing your first few rentals will give you way more education than you’ll ever get with a PM company. Plus the extra cash flow doesn’t hurt either.
You have to ask why you think the apartments aren’t renting. Are you too busy to pick up the phone and return calls quickly? Or is the price too high?
A PM company can help with the first, and possibly the second - by providing comps.
I’m managing my first few rentals until the time commitment gets too much. For me, it’s worth the time - especially since once things get going, there’s not a whole lot of work. That and I don’t want to go through the hassle of finding a GOOD PM.
It is 4 units and you live in 1, manage it yourself. If you screen properly and set-up proper qualification criteria then stick to it you should find good tenants. Taking 2 months to find tenants is on you. You're too high for your unit or you aren't being proactive enough. My longest vacany in 8yrs is 2 months. It was the dead of winter and I honestly wasn't proactive. I was lazy. Finally I woke-up one day, kicked myself, jumped on it hard and had a tenant in the unit in less than a week. So get after it.
I post my rentals on craigslist, zillow (which posts to a handful of other sites as well), and a couple other places. I get a lot of contacts and weed through them in various ways to find the serious, properly qualified tenants. Craigslist is where most look, at least around here. You should be posting ads on craigslist 1-2x per day until it is rented. Respond to people quickly, have some questions to see if they woulf qualify, when they are moving, they're ok with your guidelines, and how serious they are looking. If everything checks out set-up an appt, I like to schedule open houses and appts back to back. This helps reduce time spent at the property, some people don't show, and etc.
Since you have gone 2 months with a vacancy I'd move to 3x a days on craigslist; morning, afternoon, and evening until it's filled. Filling units is the most time consuming part of managing a rental. Outside of turnovers I spend 1-2hrs per month on my rentals.
As Mike said, managing yourself in the beginning is also a great way to learn the ropes. If you have no idea how it works then you will be ripe to get taken by a PM company and while I have never personally used on I have heard enough stories on here, from local investors, and even my own tenants to know you must be cautious with a PM company.
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