Investor · Central/Eastern Kentucky · Member since 2021 · 7 posts · 3 votes
For new and smaller investors, when you use BP Rental Calculator, if you will be doing your own property management, do you set Property Management Fees to 0% and accept the Cashflow and CoC as true? Or, do you set it to PM Fees to 10% to see the "true" Cashflow and CoC numbers? Or, in general, when an REI says Cashflow and CoC, do they always assume that those numbers include 10% PM fees? I don't want to force numbers to justify the property, but for new and small investors, I want to make sure I'm not missing out on deals, either. Thanks
@Josh Stamper Do you plan to manage the property yourself forever? Is there a possibility you may want to have someone else manage it in the future? Personally, I would add PM costs just in case I don't want to manage it any longer and know it will still cash flow positively.
Always include PM, even if you self manage. For two key reasons: i) you may self-manage today, but what about tomorrow? You may not want to manage properties your whole life; ii) What if you buy more properties and scale? Are you going to continue to self manage?
Including PM is the right thing to do when planning your investments.
@Josh Stamper Do you plan to manage the property yourself forever? Is there a possibility you may want to have someone else manage it in the future? Personally, I would add PM costs just in case I don't want to manage it any longer and know it will still cash flow positively.
Best of luck!
Thanks! Yeah, my plans are to pass them off after I have enough, so that makes sense. Appreciate the advice!
Always include PM, even if you self manage. For two key reasons: i) you may self-manage today, but what about tomorrow? You may not want to manage properties your whole life; ii) What if you buy more properties and scale? Are you going to continue to self manage?
Including PM is the right thing to do when planning your investments.
Hi Nick, thanks for the advice and perspective. I hope to pass them off at some point, so I will leave the PM in. After looking at so many ways to find ways to make a deal work and then make sure I'm not forcing numbers, I really appreciate having advice from a person that has been there, done that. Thank you!