Real Estate Investor · Renton, WA · Member since 2008 · 16 posts · 0 votes
I'm new here and really like this site. All this talk about property managers makes me wonder. How many of you used property managers? I've heard their rates are usually 5-10%. I handle one SFR right now, but am looking into multi-families. How much of the burden to property managers really take off the owner?
Real Estate Investor · OH · Member since 2008 · 4k+ posts · 1k+ votes
18y
I believe that this is just an urban legend and part of the "get rich while doing nothing" fad. I don't know of a single business that could survive without the involvement of the owners. Donald Trump and Warren Buffet were mentioned earlier in this post. Do you know anyone that works harder than these 2 guys??? I recently heard Donald Trump say that he NEVER takes a vacation. Not quite a disengaged owner! He's working his butt off to keep what he has and to build his business.
Real Estate Investor · Anchorage, AK · Member since 2008 · 63 posts · 3 votes
18y
Originally posted by Michael Rossi:
I don't know of a single business that could survive without the involvement of the owners.
Oh, really?
Walmart
IBM
HP
Wells-Fargo
Western Union
AT&T (Bell Labs)
All of them started small, every single one of them started with the founder doing everything. Then they learned a little and hired some help and the rest is history.
Where do you think Walmart would be today if Sam Walton had stood up and proclaimed "Hiring store managers is an expense! I will do it all myself!"
This is why I don't beleive even you beleive what you are saying.
Real Estate Investor · OH · Member since 2008 · 4k+ posts · 1k+ votes
18y
Where do you think Walmart would be today if Sam Walton had stood up and proclaimed "Hiring store managers is an expense! I will do it all myself!"
Hiring store managers IS an expense, a necessary expense, but an expense nevertheless.
Gary, I'm not saying that you (or anyone else) shouldn't hire a manager. Quite the contrary, if your properties are long distance; you have a 9-5 that pays more; you don't have the desire or personality to manage the properties yourself; or you are too busy with other businesses, then hiring a manager is certainly wise and may even be mandatory. However, none of that changes the fact that management IS AN EXPENSE.
...and as for Walmart, IBM, etc, the big institutional owners of these companies are actively involved. They exert their will and oversight over these companies all the time. When the board and management of these companies don't act according to their wishes, they install their own board and their own management. The point is that businesses don't just magically continue without the involvement of the owners. Whether you're Donald Trump or Joe the real estate investor, unless you work your butt off, your business will not survive. That is ESPECIALLY true of small business, which is basically everyone on this forum!
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
18y
I've spent most of my working career in corporate America. I've had a couple of chances to see how the CEO's work. In one case at a 1000 person company, and in another about 7000 people. In both cases, folks may have disagreed with decisions made by these executives. But there was no question there busted their hump. Not sure it if was "working in the business" or "working on the business", but it was certainly relevant. And, they were involved both in high level strategic question like where did the company invest money all the way down to very detailed discussion about specific problems in specific projects.
Real Estate Investor · OH · Member since 2008 · 4k+ posts · 1k+ votes
18y
Wheatie,
I agree and that is no different than smaller businesses. I have several friends that are multi-millionaires (including one with a corporate jet). and they all work their butts off.
You hit the nail on the head with the talk of working "in" vs "on" their businesses. More silly guru terminology meant to convey that people can get rich without doing anything. Whether it's "in" or "on", they're working their butts off doing something.
Attorney · Raleigh, NC · Member since 2008 · 4k+ posts · 1k+ votes
18y
Originally posted by Gary Moore:
That post reminds me of when a girlfriend I had would whine to me about being mad but not tell me why she was mad and tell me to figure it out. Heck, if I could've figured it out she probably wouldn't of been mad. :roll:
I don't know what you see in those posts because, like my former girlfriend, you want us to figure it out. However, I will tell you what I see.
I see someone who cannot understand why anyone would do anything differently than the way he chose to do it. Then on top of that, he can't understand why someone he views as an upstart like me, doesn't see the total and complete wisdom of his ways and do it using the way he is convinced is superior.
Hey, as I said, if could've figured it out, she wouldn't have been mad and now be an ex-girlfriend. :wink:
Gary, take a look at this. I speak of someone's style in relaying business principles and your first thoughts run to an ex girlfriend. Business and girlfriends are not the same thing. You are far too emotionally involved in your business and it comes through in what you say. Some modicum of emotional involvement in a business is healthy and good for that business but when it comes to cold, hard business logic - this does not serve you.
You're absolutely right. I want you to "figure it out". You can't run your business constantly being spoon fed information from a guru. You have to make your own information at some point and there will be a day when you prove your mentor wrong on some point. We don't all get everything right in everyone's perception.
Attorney · Raleigh, NC · Member since 2008 · 4k+ posts · 1k+ votes
18y
Originally posted by Michael Rossi:
You hit the nail on the head with the talk of working "in" vs "on" their businesses. More silly guru terminology meant to convey that people can get rich without doing anything. Whether it's "in" or "on", they're working their butts off doing something.
Very true. A PM helps someone work "on" a business but every time they hire one - they have to get more property to cover the cost of having one. And now you have the burden of being a good enough investor to find good enough deals to pay the PM and feed the hungry mouths he or she has at home.
Real Estate Investor · Anchorage, AK · Member since 2008 · 63 posts · 3 votes
18y
Originally posted by Joshua Dorkin:
I've been sitting on the sidelines here, but this discussion is just getting old. I'm all for healthy debate, however the nasty tone here needs to go.
Everyone in this discussion is capable of having a debate without throwing snide remarks back and forth.
That said, please argue your points without attacking one another. If you can't do this, I will close the thread.
Thank you.
I guess I was a little sharp in my response to his personal attack on me. I will certainly try to ignore those instead of responding to them in the future. After all, my Daddy gave great advice about arguing with a ...... no, on second thought I'm going to just let it go.
Mike, you are right. The first chance I get I am going to fire my property manager so I can reduce expenses and make the NOI look better. Then I will sell it at that higher price.
Except, when anyone does the due diligence on apartments they are going to deduct an amount to cover property management and I am right back to where I was. Darn.
Boonies, PA · Member since 2008 · 333 posts · 15 votes
18y
Having a PM depends on your personal, and financial situation, as well as your goals. I have a PM, I travel about 6 months of the year. It gets intense at times. REI is not my main gig. I just buy the properties because they give a better return than my other investments. These properties are retirement investments not another job thats foresure.
Someone mentioned about some people being arrogant. Welcome to a public forum. Debating an issue and being flexible is the key to success. Think positive, stay positive. Just make every issue positive.
Attorney · Raleigh, NC · Member since 2008 · 4k+ posts · 1k+ votes
18y
Originally posted by Ken Hicks:
Someone mentioned about some people being arrogant.
Interesting you mention "arrogant". You need a bit of arrogance in this business. Only an arrogant S.O.B. would offer 30-50% of list price on a property. So, while it is a weakness in business - it can also be a strength when used properly. Personally, I like Gary's attitude though I may disagree with him in a few points of theory. That "imrightdammitedness" will actually serve him quite well when coupled with information he will learn in time.
Manhattan, NY · Member since 2008 · 801 posts · 61 votes
18y
Originally posted by Ken Hicks:
Someone mentioned about some people being arrogant. Welcome to a public forum. Debating an issue and being flexible is the key to success. Think positive, stay positive. Just make every issue positive.
So very true. Many don't understand you can be confident without being arrogant. As far as I am concerned, there is no need to be arrogate in your interactions with anyone. If you have the knowledge, research and data to support your position, the facts can be presented in a confident and straight forward manner. I can be confident in my data and presentation through preparation. I can still be open to someone showing me there a flaw in there somewhere without it being personal.
Confident people can make mistakes without their personal self esteem being dinged, arrogant people can't. They have to be perfect because if they aren't and anyone points it out, they see it as an attempt to take them down a notch.
Way too many people come off arrogant when they would be better served by being prepared and confident.