Rental Property Investor · Cincinnati, OH · Member since 2014 · 150 posts · 59 votes
My business partners and I just created a new property management company here in Cincinnati, Ohio to manage the properties in our portfolio. I am hoping that current PMs and owners who use PMs can offer some tips on the best way to manage the cash handling between the management company and the owner. We are currently only planning to manage our own properties, but we want to set up the company as though we are managing 3rd party properties so we will be able to transition to that quickly if we determine it's the right opportunity.
Our plan is to have the management company collect all rents, pay all expenses, and send a check to the owner for the net cash flow at the end of the month, less management fees.
Is it common practice for PMs to pay the mortgage, insurance, property taxes, etc., or should the owner be paying those expenses?
Is it difficult getting vendors, such as lenders and utility companies to work with the management company since they are not the property owners?
For large expenses, such as property taxes, do you have the owner transfer money over to the PM in advance so they have enough cash to make the payment?
Do you have a separate bank account for each owner that you manage for where a reserve is kept? Does the PM and owner both have access to this account to add and withdraw funds?
I have more questions, but this is probably enough for now! Thanks in advance for all of your help.
Investor/Syndicator · Cincinnati, OH · Member since 2014 · 470 posts · 599 votes
10y
Great questions Coleman. Keep at them and The right solution will come to you. A previous poster said "You could ask a hundred questions, get all kinds of answers, and still not know enough to run a PM company." I agree with this but smartest people can get 100 answers and then make one educated decision based off of those answers. Then adjust as they feel needed through real world experience. Some feel they need to pay for education, get certificates to feel qualified. Some are able to do it with out that. By way of example it would be like someone becoming a millionaire flipping houses with out ever going to any trade school or getting a contractors license ;) . Keep at it!
@Nathan Gesner It is sad to see someone as successful in the industry as yourself answer this question the way you did. With a few assumptions and choice words you managed to come off disparaging, and frankly a jerk. BP is the platform set up to do exactly what your criticizing Coleman for doing.
Rental Property Investor · Norwalk, CT · Member since 2013 · 276 posts · 147 votes
10y
I asked very similar questions as yours a while back and didn't get much in the way of help either. From what I have gathered, most PM companies keep a trustee account for managing client funds but don't keep actual individual bank accounts for each owner, but through accounting records. As the property manager you would collect the rents, pay the bills, hold reserves for larger expense like tax and insurance payments and future capital expenditures and then disperse remaining profits to the owners minus your fees. If additional funds are needed for capital expenses, of course the owner would have to bring funds to pay for them. Most of this will be discussed and arranged with the property owners in advance.
Hopefully you'll get more responses, for both our sakes!
Investor · west seneca, NY · Member since 2014 · 376 posts · 211 votes
10y
daniel has the right idea. you can elect to pay everything for the owners if you choose, or just a few things that you agree upon. every contract is different. depends on what you arrange with the client. your fee should be adjusted accordingly to what you take care of for the client as well.
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
10y
I believe you have to be a licensed real estate agent working under a broker before you can manage for others. You should consider starting by taking a couple classes in basic property management. You don't even know the basics which means you don't even know what you don't know. You could ask a hundred questions, get all kinds of answers, and still not know enough to run a PM company.
By way of example, it's like saying you want to be an appliance repair technician. Then, instead of going to school to learn the trade, you just hop on a forum and start asking what parts and tools you will need to fix appliances. Jumping into PM without an education or the established policies and procedures is why our profession has a bad rap.
Investor/Syndicator · Cincinnati, OH · Member since 2014 · 470 posts · 599 votes
10y
Great questions Coleman. Keep at them and The right solution will come to you. A previous poster said "You could ask a hundred questions, get all kinds of answers, and still not know enough to run a PM company." I agree with this but smartest people can get 100 answers and then make one educated decision based off of those answers. Then adjust as they feel needed through real world experience. Some feel they need to pay for education, get certificates to feel qualified. Some are able to do it with out that. By way of example it would be like someone becoming a millionaire flipping houses with out ever going to any trade school or getting a contractors license ;) . Keep at it!
@Nathan Gesner It is sad to see someone as successful in the industry as yourself answer this question the way you did. With a few assumptions and choice words you managed to come off disparaging, and frankly a jerk. BP is the platform set up to do exactly what your criticizing Coleman for doing.
Coleman, many of your questions will take care of themselves. The info below is based on my experiences in CA.
1. When 3rd party owners contact you, they will probably already know what they "want" from property management. Most owners will want you to screen and place tenants, collect the rent, subtract your fees and send them the balance every month. The owner will pay the mortgage himself, as well as the taxes. Keep in mind that if you agree to pay mortgages for owners, if that payment is ever late, then that late will show on the owner's credit report and the owner will be very very angry at you. If you agree to pay mortgages and taxes for an owner, I would include a premium for that service. Electronic bill pay may mitigate that risk, but on the flip side, will mortgage companies allow you ongoing access to their customer's online account? If so, how much management company time will have to be devoted to setting up and maintaining electronic mortgage paying accounts for all of these customers? What about password changes which are being required more and more often by financial institutions? What if the owner changes the password, fails to notify you, and your payment to their mortgage company doesn't go through? Now the owner has a 30 day late and blames you...
2. Most owners will want you to handle maintenance issues for them. I believe this is the area where most owners have conflict with property management companies. A tenant has an electrical circuit that goes dead. The tenant calls the management company. The management calls the owner. The owner says "handle it." The management company sends a reliable, licensed electrician whom the company trusts (and has a long relationship with) and is 100% sure will fix the problem and not overcharge.
THEN this happens. The management company takes the electrician bill, adds a "management fee", re-invoices the bill to the management company's invoice and sends that bill to the owner. The owner is either A. happy that the problem is solved, or B. thinks that the bill was too high and wants to know who did the work and what the electrician's invoice amount was.
So the management company must take the position of "we use quality, reliable, experienced, trustworthy contractors whom we KNOW and TRUST, and who gives us a volume discount, to handle maintenance issues in an expedient manner and WE CHARGE YOU A FEE FOR THAT KNOWLEDGE AND EXPERTISE."
The alternative to that is that the management company simply calls a reliable, well known company with a good reputation and nice newer model, shiny trucks with professional graphics and cool slogans on them (AND VERY EXPENSIVE), pays the bill and then passes that bill on to the property owner.
In the first example the property owner might believe that the management company is ripping them off by adding a management fee to the repair. In the second example, the property owner might feel that the property management company didn't "look our for him" by attempting to keep the cost of the repair down.
You will keep and maintain a trust account to pay your bills. No need to have dozens of accounts.
***the single best reason to have a property management company is to have the inside track when an owner inevitably sells his/her property. You will have your hand on the pulse of that owner and know exactly what his pain level and motivation for selling is. You will know every single TRUE operating cost of that property, deferred maintenance, true rent roll numbers. And if you don't want to buy it yourself, you might be able to broker an off market deal, selling the property to another of your owners who is looking to buy more units.***
Investor · Spokane, WA · Member since 2014 · 733 posts · 155 votes
10y
I am sorry for my ignorance because I haven't all the comments, but can't you just send payment to owner via electronic debit or bill pay type function. It goes from ur acct to owners on a particular day you identify.
Investor · Cincinnati, OH · Member since 2015 · 229 posts · 50 votes
10y
Hey @Coleman Nelson I think this is a great idea. Especially with the upside in creating another deal pipeline. Once you get all of your systems in place and have the right team members performing the tasks for you (leasing agent, maintenance man, marketing director, etc.) then why not start taking on other properties? At that point, you will be able to do more of the creative thinking on how you can become more efficient, effective, and profitable. What a great way to create more cash flow and eventually scale up to a point where you would even be able to sell the PM biz once you would get to that point.
This is also something I would like to do once I get all my systems in place. It's great because you can learn what systems/processes/people work well for you before committing to other owners.
The biggest question I have been hunting for all over BP and the web is how much can you expect to make owning a PM business. Obviously we can back out what we think a PM company would make using the 10% fee, account for paying employees, legal fees, etc., but I would love to hear from someone who owns a PM business.
I believe you have to be a licensed real estate agent working under a broker before you can manage for others. You should consider starting by taking a couple classes in basic property management. You don't even know the basics which means you don't even know what you don't know. You could ask a hundred questions, get all kinds of answers, and still not know enough to run a PM company.
By way of example, it's like saying you want to be an appliance repair technician. Then, instead of going to school to learn the trade, you just hop on a forum and start asking what parts and tools you will need to fix appliances. Jumping into PM without an education or the established policies and procedures is why our profession has a bad rap.
You have to start somewhere. Constructive criticism would be nice....
Looks like you manage over 200 of your own rentals.
Could you give us an idea of how you started scaling from a small amount of units/buildings to 200? What were you doing first when you had only 10 units and then started scaling? Maybe you can help us with the basics ;-)
Rental Property Investor · Cincinnati, OH · Member since 2014 · 150 posts · 59 votes
10y
Thank you all for your responses.
@Daniel Raposo, @Mark Elliott, and @Jered Sturm I appreciate your advice. Since we are only managing our own properties at this point, I think it will make sense to have our management company pay all of the expenses so the only transactions hitting the holding companies' accounts are the monthly payment from the management company and draw payments to the owners. Seems to be easier for accounting and operations.
@Nathan Gesner, thanks for all of your insights. All good advice. I agree that the main benefit to manage properties for others is the potential for deals and having a better pulse on the market. At some point that may make it worth it to make a move in that direction.
Property Manager · Victoria, British Columbia · Member since 2015 · 19 posts · 7 votes
10y
@Coleman Nelson I am a property manager from British Columbia, Canada. While every state & province has their own regulations, you need to comply with the legislation in Ohio. You have created a separate property management company.
In BC an individual or a corporation can manage their own properties without the requirement to be licensed. When we are handling rental income for 3rd parties, a licenced property manage brokerage must be used. All rents received are held in a trust account.
For commercial properties or large multi-residential properties, paying insurance, property taxes and mortgage payments is common practice. A single deposit into the investors account along with financial reporting of all income and expenses is done monthly.
For single family or small multi unit properties, owners normally pay their own insurance and mortgage payments. We can pay property taxes and we would accumulate funds in a separate trust account.
With out brokerage, repairs and maintenance expenses are done at cost, without mark-up and a copy of the invoice is sent to the owner with the monthly financial report. Owners are advised of maintence and repair requests as they occur, so that they are prepared for less than normal deposit amounts.
Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
10y
Coleman so you own in Ohio but want to set up a management company in Kentucky? Your profile says Kentucky.
If you are going to do large volumes of management keep it local. PM is a low return and big headache business which I was never interested in it even on the commercial real estate side.
I stick to transacting and my own investments.
PM is not huge money generator but if you enjoy it then it might make sense to scale it. If you are looking to do it in Ohio then James Wise on here has a big outfit up there. Might want to connect with him to discuss.
Real Estate Broker · Louisville, KY · Member since 2014 · 121 posts · 91 votes
10y
@Coleman Nelson I can give you my perspective owning a PM company.
1. Correct, collect pay expenses and send payment - we did this by the 15th as long as the tenant paid on time (by the 5th to allow for any checks to bounce). We also did an ACH of the money out to the owners. Which was more cost effective and easier than checks.
2. Yes, it can be difficult to get lenders and utilities to work with you as the "agent" of the owner. We never put utilities in our company name, it had to be in the owner or tenants name and we never dealt with the lenders for that reason.
3. No, I don't think it would be common for the PM to pay the mortgage, taxes etc., what if a tenant wrote a check, you wrote a check for the mortgage, the tenant's check bounced and the tenant left or was evicted. You now have paid for a mortgage payment you must now collect from the owner. I feel like that is too much liability to take on.
4. See #3 - don't pay property taxes.
5. We had 3 accounts - an 1. Operating Account (the general fund of the business to pay expenses, payroll etc.) 2. Security Deposit (only security deposit funds were put in or taken out of this account) 3. Rent Account (only rent/owner contributions for repairs were put into this account). No, the owner did not have access to this account.
Just an FYI if you are doing business in Kentucky - you will need to provide a monthly statement to the owner, provide the tenant with the account number, address and name of the bank where that deposit is held on the lease. You will need to have a real estate license, unless you are working as an regular employee of the owner of the PM, this is just a couple of items, there are many many more.
Send me a message if you have more specific questions.
Investor · Portland, OR · Member since 2015 · 119 posts · 78 votes
10y
In Oregon there is a separate way to be a PM without being a RE broker. There's a separate class and test. Idk if they have this where you live but if so then it can be easier to do.
Rental Property Investor · Cincinnati, OH · Member since 2014 · 150 posts · 59 votes
10y
@Joel Owens Thanks for your advice. I live in Kentucky, but it is a suburb of Cincinnati OH. All of our properties are within 20 miles from me in OH. So our LLCs are all Ohio LLCs. And I agree with you about PM being difficult to make a lot of money in without a lot of headaches. That's why we aren't planning to pursue managing 3rd parties at this time, but want to be able to if the right opportunity comes our way.
@Max James, it seems to me, and it sounds like Joel agrees, that it's tough to make money in PM unless you are able to get a lot of properties and go big. For instance say you do SFRs that rent for $1k per month and you charge a flat 10% fee. That's $100 per door per month. So you'd need to manage 50 properties to gross $5k per month or $60k per year. Then you have all of your expenses to account for. Hopefully that math is right! But if we are good at managing our own portfolio, which will hopefully keep growing, and have our systems in place, and someone approaches us about managing an apartment complex, it may make sense to take that on.
Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
10y
Apartment complex you have larger scale with less properties.
The type of tenant makes a difference as well. More intense tenants take a lot of time and money to manage. Double bookkeeping, extra trips to collect, higher turnover, etc.
The larger buildings do not pay 10% by the way. Usually 50 units or more you are talking a 5% fee of collected rents. You could get closer to 10% on 50 units in a rough area but not a nice area.
From 10 to 50 units depending on area and type of tenants it goes from 9% to 6% and over 50 is usually a 5% management fee.
That is for multifamily. On the retail strip center side a very small center is 5% but most are 4%. If it is a larger center it could be 3 to 3.5%.
The percentages go down as you make more money. I have some friends who own PM companies and they might clear 60k a year after expenses with hundreds of units. You have to put workers in place as you cannot do that all on your own and that eats into returns.
For me I like a peaceful life. I stay on the commercial transaction side where I make 6 figures a pop per property. I like being at the beach on vacation without a care in the world. The benefit to PM work is good economy or bad it will always be there. For sales markets get hot and get cold to average. I am having record years but I think in 2 to 3 years it might slow down some so I am investing as much as possible for passive cash flow.
I will only look over a project if I am a sponsor of a syndicate. There has to be multiple upsides to me doing a deal where I am watching over something. I get calls back from our mailers looking for sellers to sell and they sometimes are not interested but want me to do commercial PM which i politely decline.
Transacting I make thousands per hour for my time. I couldn't touch that doing PM work so it would be a huge step backwards for my time versus ROI.
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
10y
Jered, you clearly took my statement the wrong way. I said his state requires a license and he should get an education. I provided an example of how we would all be skeptical if someone planned to use a forum to become a plumber. I fail to see how this is bad advice, let alone being a "jerk" about it.
@Coleman Nelson Ohio will require you to be licensed. If your partner becomes a broker and sets up his own company, you and everyone else involved in property management will have to be licensed. An unlicensed individual usually cannot advertise, answer questions by phone, or even confirm if a unit is still available for rent! I believe the fine in Ohio is $1,000 per violation and I can assure you they audit the PM offices regularly.
If you want to handle money for others, you need to know about trust accounting and how to avoid commingling funds. Most states will not allow you to mix your own money with your clients, which means you have to maintain separate accounts for any rental properties you personally own. If you have the right property management software and systems in place, you can typically work with two accounts: operating and deposits. Operating is for receiving rent, paying invoices, paying your management fee, and paying the owner. Your state may have very specific requirements for naming the accounts. Are you allowed to earn interest on the accounts? If so, do you have to disclose it or pay the interest out to the Tenants or Landlords? What are the requirements for naming your accounts? What forms of payment will you accept or not accept? You want to accept credit/debit cards but they charge a 2.5% finance fee. Can you pass that on to the tenant? If so, are there special requirements that might make you change your mind?
You will have to create an application screening process to ensure everyone is screened fairly, honestly, and objectively. What will you do if eight young co-workers from McDonalds want to pool their resources and rent your luxury home in an upscale community? Can you discriminate against the guy that reeks of smoke and booze or has 15 facial tattoos? What about the 18-year-old kid with no rental experience and no established credit? What if the person is applying while out of state? What if a foreign national on a work visa wants to rent from you and he's unable to pass a credit check or criminal background?
You need to know how much you are allowed to charge for deposits. You need to know how much you should charge for deposits. You need to know when to deviate and charge more or less than your standard. You need to know what to do with a deposit when you and the Landlord part ways. How much time do you have to return the deposit? What do you do when the tenant fails to cash the check? What deductions are allowed? What should you deduct for and what should be an owner expense? What if the tenant owes more than is held in deposit?
What are the requirements for recording income and expenses, ledgers for Landlords and Tenants? How long do you have to hold records after the Tenant or Owner leaves? Do you have to keep paper files or can you transfer everything to digital? How do you protect the privacy of Landlords and Tenants? What can you disclose when someone calls and asks for a Landlord reference?
You need to know and understand Fair Housing, ADA, Lead-Based Paint, and mold issues. What are the occupancy requirements in your area, if any? Do you know what the code requires for smoke detectors, CO2, egress windows, deadbolts, etc? If a tenant calls and says she wants to leave because her boyfriend hit her or the neighbor is stalking her, how will you handle it? A tenant leaves in the middle of the night with no notice and you find the house full of stuff and his car is in the parking lot. What do you do?
The neighbors complain about a barking dog in one of your no-pet homes so you decide to inspect. Do you have to give the tenant notice? What does the law say and what is in your lease? When you inspect the property, can you document with photographs and/or video? Can you evict the tenant for having an unauthorized pet? What if you allowed a dog but now the tenant has a second dog or three cats? What is allowed if their pets are damaging the property? What if their kids are damaging it?
When will you pay owners? What bills will you pay on their behalf? Do you really want to be involved in paying their mortgage or insurance? If their roof is damaged, will you file the claim on their behalf or just assist as needed? Will you charge for those services since it is outside the scope of ordinary management? What if the owner wants to add a deck?
Will your tenants pay on the 1st or will you allow deviations? If a tenant starts a lease on the 20th, do you prorate their first month or do you charge a full month's rent and prorate the second month? What will you require for move-in? Will you charge extra deposit or rent for pets? Does the law allow you to charge extra for pets? What if the applicant claims to have a service animal and wants to rent a house with a no-pet policy? Can you verify their disability and if so, how?
I can clearly go on all night and still not hit everything. What I've listed above are common issues I deal with regularly. It's naive to think you can post questions on BP or any other forum and learn what you need to know, which is why I suggested you get your license and take some classes or read some books before delving into something you aren't familiar with. And I say that in a friendly, helpful way.
Investor · Cincinnati, OH · Member since 2008 · 319 posts · 243 votes
10y
@Coleman Nelson Typically you will also get a fee per lease you place as well. This can be around 1 months rent per tenant. You also keep the application fees. Which is kinda trivial revenue but it still exists.
Are you looking into using software for the property management? It will help a lot with keeping the accounting per property, tenant screening, and maintenance requests in check.
Is it common practice for PMs to pay the mortgage, insurance, property taxes, etc., or should the owner be paying those expenses?
For large expenses, such as property taxes, do you have the owner transfer money over to the PM in advance so they have enough cash to make the payment?
It is common practice to have the owners be responsible for these expenses. A property management company already has an incredibly high level of liability for a relatively thin margin business. This is not something you would ever want to take on. The infrastructure needed would be to great and the reward for the risk to small.
Is it difficult getting vendors, such as lenders and utility companies to work with the management company since they are not the property owners?
Utility companies are a nightmare to work with. Our portfolio is around 350 units right now. we own about a 3rd of that, the rest we manage for others. The utility companies are horrible in both situations. Your best bet is to only deal with the utility companies when their 1st shift workers are there. If you call after 3pm your just wasting time dealing with employees who have no idea what is going on. You can have a situation that occurs 6 different times with 6 different people and get 6 different results.
Do you have a separate bank account for each owner that you manage for where a reserve is kept? Does the PM and owner both have access to this account to add and withdraw funds?
When starting a property management company in Ohio you need to start a brokerage. As a brokerage we have 4 accounts.
1. Trust account for earnest money.
2. Trust account for tenant security deposits.
3. Property management account.
4. Brokerage operating account.
The 1st two accounts are pretty self explanatory. One holds owners earnest money and the other holds tenant security deposits. Both accounts must be non interest bearing by law.
The property management account is the account that you collect all of the rents. You only need 1 account to do this no matter how many owners you have. All the money goes into this account 1st. You then deduct all of the expenses from this account. Repairs, Leasing fees, property management fees etc. The leasing and property management fees would be income for the brokerage so they are then transferred to the brokerage operating account as income.
We handle repairs in house as well. We have a separate company for our construction which has it's own bank account as well. So all repair costs would go from the property management account as an expense to the owner and into the construction account as income.
The most important thing you need to know when running and scaling a property management company is to set policies across the board and stick to them. Every property owner and tenant is going to want you make concessions or do things differently for them. You can't do that. There are way to many plates spinning at once to ad in other variables. You need all tenants and owners on the same program or it just does not make sense for you to take their business.
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
10y
@Max James I did employ constructive criticism. Get a license, get an education, and then refine your knowledge by sharing with the experts on BP. I'm a big fan of BP, but it's not a good place to build your knowledge from the ground up unless you intend to take years doing so.
How did I scale? First, let me point out I didn't graduate highschool and jump right into PM. Nor was I working a basic-level job. I spent 21 years in the military where I gained a ton of experience managing people, money, and resources. For my last 9 years, I was responsible for up to 120 people, an operating budget of $2.5 million, and a couple hundred million dollars worth of facilities and equipment. And people shot at me on occasion. Managing houses and angry tenants seemed like a piece of cake! That's an exaggeration, of course.
I owned some investment property and had hired a PM. It wasn't the worst experience, but it wasn't the best. I had enough life experience to know that in most jobs, there are those that do the minimum to earn a paycheck and then their are those that work hard to make things better. I had no doubt I could do a better job at PM than most and I enjoy managing assets, so it seemed a good fit.
I read several books about investing and Landlording over the years. Then I got my real estate license and worked under an experienced property manager. I didn't necessarily agree with how she did things but it still educated me quickly on the basics. I quickly took off but I still continued to educate myself and refine my business. Even to this day I am regularly exchanging ideas with other successful property managers around the country, mostly through National Association of Residential Property Managers (NARPM).
Again, BP is a great resource for information but I do not think it is a good starting point for a professional PM. When you ask a question on a forum, you may end up with more answers from novices than from people with experience and it's often difficult to tell them apart. I guarantee you there are people on this forum with decades of investment experience that haven't a clue what it takes to manage properties for others as a professional manager. If you don't have a strong foundation, how will you know?
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
10y
@Coleman Nelson you can make good money at PM. The average REALTOR makes about $40,000 a year. With at least one designation (CRS, GRI, etc.) the average salary jumps to about $67,000 but those with designations also typically have much more experience. The average salary for a property manager is probably a little higher than your typical sales agent.
I network with some of the most successful managers around the country. They all agree profits are maximized when you are below 100 units (if set up correctly). Between 100 - 200 units you start adding expenses like office space, assistants, etc. Once you get over the 250 mark, profit starts to increase through economy of force.
I won't share hard numbers but can tell you that I make a lot more than your typical sales agent. 2015 was my first year with no business loan payments and my take-home pay was about 20% higher than it was the first four years and will be about another 15-20% higher in 2016. Out of 140 agents in the county, I am in the Top 3 for take-home pay. And while sales agents may enjoy flexibility with their schedule, they do not enjoy nights and weekends off or steady paychecks like I do!
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
10y
@James Wise I read that same page earlier today and am surprised Ohio allows an unlicensed person to do more than is allowed in Wyoming. In our state, my office manager is not allowed to say anything about a rental because that could be construed as "negotiation" of a real estate transaction. She can't say whether it is still available or even read information off a sheet that I have provided. It's very frustrating for us and to those seeking information.
Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
10y
"And while sales agents may enjoy flexibility with their schedule, they do not enjoy nights and weekends off or steady paychecks like I do!"
Nathan I think that can be true some for the residential agents.
On the commercial side deals can take 3 to 4 months to close sometimes but as a principal broker I get it all. So when I get a 200k commission check while more infrequent it goes for a very long time.
There are many different flavors for real estate which is what makes it so interesting. The part you love organizing and managing a bunch of things is what I can't stand. I am a free spirit and thinker and love the art of the deal.
I have always sailed my own ship in life.
The key is love what you are doing. If you love it then it isn't work. Some people would say they do not like working on complex transactions but I feel great satisfaction when each closes. The same satisfaction someone else gets from doing the PM work I can't stand.
People see value in different things because it makes them passionate and happy.
I think James Wise showed how much work goes into doing PM properly by listing all of those activities. PM is a thankless job where the investors generally give little thanks and point out things only when they are wrong. They also tend to feel they make too much for what they are doing.
I think a PM company would do great to break down each step of the job showing a 100 point management plan or something. I remember back in the day on the SFR side they would list 100 items agents do for a listing to market it and help affect a sale. It looked more substantial than just having everything lumped into 1 to 3 steps. When it was broken down and the seller could see the many steps involved most didn't question the value being offered for the price of the services.
Great questions Coleman. Keep at them and The right solution will come to you. A previous poster said "You could ask a hundred questions, get all kinds of answers, and still not know enough to run a PM company." I agree with this but smartest people can get 100 answers and then make one educated decision based off of those answers. Then adjust as they feel needed through real world experience. Some feel they need to pay for education, get certificates to feel qualified. Some are able to do it with out that. By way of example it would be like someone becoming a millionaire flipping houses with out ever going to any trade school or getting a contractors license ;) . Keep at it!
@Nathan Gesner It is sad to see someone as successful in the industry as yourself answer this question the way you did. With a few assumptions and choice words you managed to come off disparaging, and frankly a jerk. BP is the platform set up to do exactly what your criticizing Coleman for doing.
Jered,
I appreciate your response here and your bravery in tackling the matter. I think some members need a refresher on what BP is all about.
Secondly I think some of these people should simply watch more TV. If your about to make a comment on this forum and you find that it offers no helpful information, I think you should pull back, change the channel and keep your regular entertainment going. This is not a place to entertain yourself, unless of course learning, sharing and assisting is joyous for you. It is for me!
