SHOULD I HIRE OUT A PROPERTY MANAGEMENT COMPANY

[Matthew Wright]

Hello Bigger Pockets

I am new to the world of REI and am currently looking for my first deal. I am looking for a SFH or a townhouse, preferable townhouse for lower maintenance costs, 3 beds 2 baths, 1800 sq ft, in a neighborhood. I also prefer these homes be close by in my market. I hope to have 2 or 3 properties over the course of the next year or 2. My question is this: Should I secure a property management company to cover the land lording duties on my first couple of deals. I would need assistance on drafting leasing agreements, vetting tenants, rent collection etc, etc. Also, I currently work 60+ hours a week at my day job so I may have limited time when it comes to the actual management of the property. The catch is, after allotting 7% for vacancy, 7% for repairs, and roughly $110/month for property management services - my returns/positive cash flow is next to nothing. It's also important to note that I am looking for a property that is more turn key. I would consider a fixer upper if the returns were higher and I could find the deal, but with my time being as limited as it is I would want to turn the property quickly to get a renter in, and that might not be doable for my current situation. I would be happy to share my numbers if anyone would like to see them and offer a piece of advice. Thanks!!

[Brad Larsen]

It comes down to what you feel your time is worth.  If you want to save $20/hour by doing everything yourself in the management side, and you are the do it yourself type because this gives you satisfaction - self manage.  If you want to spend that time chasing deals to make you possibly $20,000 an hour - that is where the gold is.