Ohio Property Management - more hands on approach

8 Replies

Sometimes investing out of state is the only way to get decent cashflow. I suppose a lot of out of state investors want to be hands off. Now, what happens if you have a property manager, but you would like to be more hands on? If you don't wanna to just get a 1099 at the end of the year? 

When I do purchase out of state, I'm gonna have to hire a property manager. There is no other way around it. Let's say that the property manager finds a qualified tenant and decides to rent to them. Personally, since it's my money thats invested into the property, I would like to review every tenant application personally and work with the property manager on choosing the best qualified tenant. If I can't meet them, at least I wanna be able to review them. Sometimes if you wanna do something right you gotta do it yourself. Obviously as an owner you're gonna be more vigilant than a property manager who has another 500 properties to look after. How does it work from the property managers perspective?

Personally I would like to:

-Review every tenant application and make the ultimate decision on who to rent to (I had tenants who were well qualified but couldn't come up with a deposit on time. Big red flag... )

-Have to approve every single repair request, no matter how small (for example if a tenant damages the closet door for the 3rd time in two months, obviously I'm not gonna keep having somebody come out, keep fixing it, and charging me)

Are there property managers out there in the Cleveland, Ohio area that are willing to work with owners like that? It may be a silly question, but I never dealt with a property manager before. 

As I said before. I don't want to be completely hands off. I like to maintain control of my rentals AND tenants. Personally visiting the property at least once a year for an inspection to be included. Just as if there is a major fix that has to be done to the property. If I can fix something myself over the weekend for $300, obviously I'm gonna come out and do it myself, instead of paying a contractor who may wish to charge me $3000 for the same job. NJ to OH may be a trip but it isn't THAT far. I can drive those 7 hours straight non stop, plus I like driving :)

Your insight and experiences are greatly appreciated. I'd love to hear from out of state investors and property managers alike. 

I am not a professional property manager. (I manage seven rentals of my own.) But I am in professional services. I do bookkeeping, accounting and tax preparation.

My first reaction is that... you sound like a nightmare client. You are the client who is going to look at what I did for you last year, and try to replicate it on your own, then present me with a mess that's going to take hours/days to untangle and tell me you should be charged less because you did some of my work for me. I don't want to work with that client. And you don't want to be that client, because I'll spend as little time talking to you as possible.

Or, if you were my boss, you'd be the micro-manager.

But, I get where it comes from. This is an area you're not that sure about yet and you're hiring a new person who you don't know to manage something that you're sinking a lot of money in to. I think most good professionals will expect to do a little hand-holding at the start. But I don't think you're going to find many who are enthusiastic about you wanting to re-check all of their work long term.

Why not treat it like hiring any other employee? Interview a few different ones, see who you trust the most, ask them to run everything by you for the first three months, and after that probationary period, decide whether you want to keep them. If you do, let them do their jobs.

Originally posted by @Jake Recz :

Sometimes investing out of state is the only way to get decent cashflow. I suppose a lot of out of state investors want to be hands off. Now, what happens if you have a property manager, but you would like to be more hands on? If you don't wanna to just get a 1099 at the end of the year? 

When I do purchase out of state, I'm gonna have to hire a property manager. There is no other way around it. Let's say that the property manager finds a qualified tenant and decides to rent to them. Personally, since it's my money thats invested into the property, I would like to review every tenant application personally and work with the property manager on choosing the best qualified tenant. If I can't meet them, at least I wanna be able to review them. Sometimes if you wanna do something right you gotta do it yourself. Obviously as an owner you're gonna be more vigilant than a property manager who has another 500 properties to look after. How does it work from the property managers perspective?

Personally I would like to:

-Review every tenant application and make the ultimate decision on who to rent to (I had tenants who were well qualified but couldn't come up with a deposit on time. Big red flag... )

-Have to approve every single repair request, no matter how small (for example if a tenant damages the closet door for the 3rd time in two months, obviously I'm not gonna keep having somebody come out, keep fixing it, and charging me)

Are there property managers out there in the Cleveland, Ohio area that are willing to work with owners like that? It may be a silly question, but I never dealt with a property manager before. 

As I said before. I don't want to be completely hands off. I like to maintain control of my rentals AND tenants. Personally visiting the property at least once a year for an inspection to be included. Just as if there is a major fix that has to be done to the property. If I can fix something myself over the weekend for $300, obviously I'm gonna come out and do it myself, instead of paying a contractor who may wish to charge me $3000 for the same job. NJ to OH may be a trip but it isn't THAT far. I can drive those 7 hours straight non stop, plus I like driving :)

Your insight and experiences are greatly appreciated. I'd love to hear from out of state investors and property managers alike. 

 You would need to hire an employee to accomplish this. You are looking for a handyman who will also open the door for tenants and scan you paperwork essentially.

@Jake Recz

It sounds like you may want to self manage your properties.  Although difficult, you will be able to have that hands-on approach you are looking for.

This would be a pain for most property managers to deal with, at least in the way you describe.  I really cannot think of any repair that would be cheaper for you to drive from NJ to Ohio for in order to fix cheaper.  MAYBE if you get great gas mileage, or you were already planning on being there (say its your yearly inspection) then it could possibly be worth it.  

You are better off finding a property manager that you can trust.  Someone with a maintenance dept who can charge much smaller fees for small fixes and only needs to sub out the big things.  You can set low limits on fixes and get weekly status updates.  The more units you have the more willing a PM would be in managing your units. Also, approving tenants is a pretty easy ask, and not that uncommon.

The best news is that if you end up with a great PM relationship it will allow you to become more hands off in the future.  There is a fallacy that property managers will not treat a property like it is their own.  Though there are certainly bad PMs out there, and certain things will be different (aka small charge for small fixes instead of weekend work) your property is your PMs inventory it is their business and a good PM would not treat it poorly since as soon as that happens their revenue stream would quickly dry up.  It would be like an owner just tossing an ol' applicant into their rental property, sure it may take a few months for something bad to happen, but you will lose money in the long run.

As a professional property manager, I'm going to advise you to manage your own property.  Investors hire a management company to alleviate themselves from everything you seem to really want to do.  If you vet the manager properly, you're likely to get a manager who will do what you are paying them to do - manage your property.  There is nothing wrong with you wanting to be informed, and as the owner, that is your right, but you have to trust the people you hire until they prove themselves untrustworthy. 

Reading your post honestly made me cringe (sorry, but it did) because that type of owner-manager relationship is crippling and any competent manager will likely feel the same way. Save yourself the money and self-manage until you've decided you don't want to handle it anymore.  Best of luck to you!

Great info guys. Thank you. FYI I'm not completely crazy ;) I suppose I could be a nightmare client like  @Gwen Fyfe mentioned. It's the beginners mindset I suppose. I promise I will easy up. When hiring somebody be it a property manager or a a contractor or anybody for that matter we all want to see results. Personally, in the beginning I tend to watch closer, but if things are going good, smooth and everything is being done according to contract, I take a step back and let them do their thing. The 10% off the rent being paid to the property manager is to let me easy up. So if I'm paying somebody to do the work and manage the property it would be crazy for me to chime in every step of the way. Plus it would probably drive me and the property manager crazy. 

One thing that I can't imagine letting the property manager do 100% on their own is approving tenants. I almost got burned before. A few times actually. Careful due diligence on my part and really researching the tenants allowed me to stay trouble free, for the most part, and pick the best applicant that came forward. I don't discriminate, but... If I go on a prospective tenants Facebook page and they have pictures of themselves doing coke off the table, throwing gang signs, and complaining about their past eviction that didn't show up on the background report, we have a problem. The application, employment, and everything else looked great. Great prospective tenant. Facebook burned them. I'd let the property do manager do all they gotta do, but when it comes to tenants, I want to see the three best picks they made so I can dig deeper than any property manager would on their own for the exact reasons described above. 

Originally posted by @Jarrod Kohl :

...  There is a fallacy that property managers will not treat a property like it is their own.  ...

Well, I can say that I purchased an REO property that was owned by a property manager. This PM had a number of his properties all go to foreclosure around the same time, and they all looked like crap inside and out. Believe me, you wouldn't want him to treat your property just as he treated his own - you would want better, but given what we see in his properties he is not capable of any better.

Originally posted by @Steve Babiak :
Originally posted by @Jarrod Kohl:

...  There is a fallacy that property managers will not treat a property like it is their own.  ...

Well, I can say that I purchased an REO property that was owned by a property manager. This PM had a number of his properties all go to foreclosure around the same time, and they all looked like crap inside and out. Believe me, you wouldn't want him to treat your property just as he treated his own - you would want better, but given what we see in his properties he is not capable of any better.

 Haha, to be fair it sounds like in that case they were his properties.  But it is true a bad property manager is a terrible thing and can cause a lot of issues, especially if you combine it with bad screening and a bad tenant. That is why, if you are going to spend the money you want a good property manager, proper screening, preventative maintenance, and 24/7 emergency maintenance  means a lot less headaches for your investments.

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

Join the Largest Real Estate Investing Community

Basic membership is free, forever.