Does anyone use a management company to run their STR?

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Does anyone use a management company to run their STR?

Alex K.
DE · Member since 2009 · 35 posts · 9 votes

The area's I am interested in aren't anywhere near me - so just wondering if it's feasible and if anyone has experience outsourcing the management of a STR? Pro's, Cons, Thoughts?

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Kenneth GarrettPro Member
Investor · Florida Panhandle/Illinois · Member since 2016 · 4k+ posts · 3k+ votes
4y

@Alex K.

You don't need a management company. They will eat into your profit. I self manage 1000 miles away. You need a good cleaning company and a handyman. I use Schlage encode to issue door lock codes and have a ring camera. Takes very little time at all to manage a STR. Let the VRBO and Airbnb platforms do the rest. You can manage it from your phone.

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  • John UnderwoodPro Member
    Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
    4y

    You can self manage from half way around the world.

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  • John D.
    Rental Property Investor · La Quinta, CA · Member since 2014 · 1k+ posts · 779 votes
    4y

    I couldn't find a competent property management company in the area, so built one with the help of a good friend.  If a quality property management company exists on your market at a reasonable price, consider using them.  If they do not, do not!

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  • Jake CohenPro Member
    Rental Property Investor · Denver, CO · Member since 2017 · 201 posts · 126 votes
    4y

    @Alex K.

    Here’s an example with some real numbers. I bought a duplex in Gulf Shores, AL last year. I inherited a property management company with reservations through the high season. I purchased in early June. I let them manage through early August so about 2 month during peak season. Last year I made about $25,000 during each of those 2 months. This year I was self managing. I made $58,000 in one month and just over $50,000 in the other more than doubling the revenue that came in. This is a very seasonal market that makes the majority of money in 5 months of the year. To me many property management companies have gotten stuck in the past. This one did not even list properties on Airbnb because they tried it and didn’t get much from it years ago. Airbnb is now huge and we get almost all our bookings from that 1 site. There are great management companies out there and you can still make money using them, but you can also make a full time income managing 1-2 of your own properties. Take a property that makes $100,000 per year and give $25000 to a property manager. For me, I’d rather invest a few hours a week and get paid the extra $25000.

    Good luck on all your investments!

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  • James Carlson
    Real Estate Agent · Colorado | stan.store/JamesCarlson · Member since 2014 · 2k+ posts · 2k+ votes
    4y

    @Alex K.

    Totally depends on your priorities. Do you want to make the most money and are willing to put in a little work for it? Then self-manage your short-term rental. If you're not organized or hate the idea of management (even if it's minimal), then by all means, hire a PM.

    I'd say most of our Airbnb/STR clients in Colorado self-manage. If you get the right systems in place (dynamic pricing tools, automated messages, cleaners integrated into your calendar, etc.) then it's not a lot of work. We have a client who has a short-tem rental in Denver and another STR in Colorado Springs. He has a full-time job in finance, a wife and two kids, and still he self-manages. He says it takes a few hours a week, but saves him 25% of the gross revenue that would otherwise go to the property management company.

    And no, you don't have to be in the city to manage. 

    But again, if you don't want to manage, then don't. Money's not everything. 

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  • Collin HaysBusiness Member
    Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
    4y

    I own a property management company.  We've never lost a client due to any dissatisfaction with us, so I suppose most are "making money".

    Self managing is the way to go if you have "TIE."   Time, Interest, and Energy to self manage.  It's a part time job.  If you self manage and don't have TIE, you're probably losing more than you are saving.  

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  • Scott Sherin
    Investor · Greater NY Area. · Member since 2019 · 56 posts · 31 votes
    4y

    Hey Alex, I agree with a lot of the opinions on here. Self-management can be a great option for many, but you need to have the appetite for it. If your confident enough in your investment's performance that you can afford a good manager, this might be a great way to outsource your operations. With that said, it is far from impossible to manage your own property even at a distance. I am a self-managed superhost and also co-host other properties, all from hundreds of miles away. A big key I've found is spending the time up front to interview, vet, and hire a rockstar team that is local. Not only assembling the team, but also creating systems and procedures that are simple to follow. Thirdly, embracing applications and smart-tech that can help you maintain visibility and control of your business. These are the onboarding steps that I take when bringing on a new client.

    I've had a lot of great mentors, so I'm happy to be a resource for you if you have more questions about self management or want to chat about potentially working together. Either way, feel free to reach out. You've come to the right place!

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