Property management: when to DIY vs. hire out

[Todd Henderson]

Just hit a milestone that forced this decision so figured I'd share.

At 1-2 doors, self-managing made sense. Knew the tenants, handled maintenance, did showings. The 8-10% fee felt like money I could keep.

Somewhere around door 3-4 the math flipped. Not because the work got harder but because my time started having a higher value elsewhere. Every hour coordinating a plumber was an hour I wasn't finding the next deal.

A good PM is an expense, not a cost. Keeps vacancy low, handles maintenance before it becomes capex, frees you to focus on acquisition. A bad PM will destroy your returns though. I've fired two. Same red flags both times: slow communication, reactive on maintenance, screening process I wouldn't trust with my worst unit.

Run the numbers both ways. Factor in your actual hourly rate on time spent managing. You might be surprised.

At what door count did you make the switch?

[Drew Sygit]

If you're a serious rental investor, here's the basic activities that make money, from highest to lowest:

1) Dealmaking
2) Rehabbing (NOT maintenance)
3) Landlording

Landlording is the worst use of a serious investor's time!