Should an owner hire a property management company?

2 Replies

Before I tell people why I think an owner should hire a property management company I’m going to disclose that I’m a licensed real estate broker in Florida & I own a real estate company that focuses on property management in Jacksonville FL. Here’s a few reasons why I think someone should hire a property management company. First, it’s a good idea to be at arm’s length with the Tenant. I have seen a lot of nice owners get taken advantage of over the years by Tenants. Another reason why it may be a good idea to hire a property management company is if you live over an hour or two away from the rental property. Do you really want to drive over an hour one way to look at something at the house? If you have a local property manager, they will usually drive by the house if needed every so often.

Do you understand your states Landlord/Tenant laws? If not, this could cost you some money if you do something that you should not do. Do you have the time & tools to properly advertise the home, screen Tenants and write a lease? Do you have a good lease? Do you know what to do if the Tenant does not pay rent? What happens if the only Tenant on the lease passes away? If the Tenant moves out do you know how to properly process the security deposit?

When I first started working in property management 15 years ago, I said to myself why would anyone hire a property management company? After working in property management for 15 years I totally understand why an owner would hire a property management company. The property management fees are usually low in my area & a good property management company knows how to properly handle all the above & more. To me it’s a good idea for an owner to have a good, experienced property management company in their corner. 

Another perspective - I self manage around 20 Class B SFHs and have absolutely no need or desire to pay someone else 8-10% to save me maybe 2-4 hours a week.  In fact, I have bought a few distressed, discounted properties from out of state investors that were using PMs.  

Local I self-manage, out of state I use prop mgr or partner with someone who can mgr.   Both have their merits.  I will be up in Jacksonville in August as I was asked to speak at the Jax REIF meeting.  Have wanted to come up to Jax for some time @Matt MacDonald and check it out.