Self-Property Managers...Any Regrets?

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Self-Property Managers...Any Regrets?

Account Closed
Investor · New York, NY · Member since 2017 · 3 posts · 1 vote
I'm debating self-managing my current primary residence following a job relocation (and move) to NYC, and in part of that decision I wanted to check with some fellow BP'ers to see if there were any 1st timers that could share their experience? Is it that daunting? I considered selling outright to pocket $80k (net of fees) tax-free, but creating passive income where I could net potentially $800-$1,000 per month would be great (rent $2.2k to $2k w/ $1,200 mortgage). Plus I get to keep my attractive 3.375% 30-year mortgage which is another bonus in comparison to today's rates. Houses go quick in my neighborhood (selling or renting) because it's in a good community in a great school district and convenient to major highways. The thought of paying 10% fees (plus 1st month's rent) is not ideal if I could place a tenant myself. I had my real estate license so I have some level of understanding of the process, but my full-time job has consumed my time so I've focusing on that instead.

For background on the property:
*15-year old townhome
*3 bedroom/2.5 bath
*Unfinished walkout basement
*Trex Deck
*Good schools

To prepare to rent I've replaced all 3 toilets with brand new units, new sump pump, new garbage disposal, new modern kitchen faucet, and new washing machine water lines. I have some other odds & ends to do but the goal is to make sure there are little to no calls about any issues. If there are any issues I don't mind fielding a call here and there to send out a handyman to fix.

Any advise would help from those that made the leap into self-management. Any tips, do's/dont's, etc. would be great!
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David M.
Morris County, NJ · Member since 2020 · 5k+ posts · 2k+ votes
4y

@Account Closed

I've managed all my own rentals...  When things go "wrong," yes its take time.  Time to change the locks, time to survey the property and what work needs ot be done, time to get the workers arranged, time to arrange getting them access (either I open the door, my realtor helps out, or I give them the keys at some time), etc.  Otherwise, it can pretty boring (which is good) when all I am doing every month is jotting down that I see the rent being deposited in my bank account every month.  Yes, you will get calls, nowadays texts, from the tenants when something is broken, and you have to, or should anyway, deal with it.  You are just managing another household...  Depending on your personal life, its just part of the hustle.

I see lots of people, I guess aka new investors, geting sucked into all the various "fancy" new-fandangled "systems" and technology.  Honestly, I think the creation of email, voice message (or an answering machine) and text messages is more than enough.  If you can make all the arrangements yourself (or I usually let the tenants arrnange for the repairmen since I'd just be an intermediary messenger making the schedule), why do you need to pay for some fancy scheduling/messaging system?  Or a property manager...

Hope that helps.  I'd be happy to chat if you like.

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  • Scott TrenchPro Member
    Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votes
    4y

    @Alicia Marks - could we potentially make this a next topic of our “poll”?

    Perhaps, “How do you handle property management?”

    - I self-manage all of my properties

    - I hire out full-time property management

    - I sometimes self-manage, sometimes hire it out

    - Other

    - I don’t own property, I just want to see the poll results!

    Podcast Guest on Show #223
    BiggerPockets
    1Reply
  • Melissa S Vrobel
    Investor · Orlando, FL · Member since 2021 · 79 posts · 36 votes
    4y
    Quote from @Drew Sygit:

    It all depends on available time and experience. How much is needed depends on the Class of Property => Tenant.

    Many investors set themselves up for failure because they don't truly take the time to understand:

    1) The Class of the NEIGHBORHOOD they are buying in - which is relative to the overall area.

    2) The Class of the PROPERTY they are buying - which is relative to the overall area.

    3) The Class of the TENANT POOL the Neighborhood & Property will attract - which is relative to the overall area.

    4) The Class of the CONTRACTORS that will work on their Property, given the Neighborhood location - which is relative to the overall area.

    5) The Class of the PROPERTY MANAGEMENT COMPANIES (PMC) that will manage their Property, given the Neighborhood location and the Tenants it will attract - which is relative to the overall area.

    6) That a Class X NEIGHBORHOOD will have mostly Class X PROPERTIES, which will only attract Class X TENANTS, CONTRACTORS AND PMCs and deliver Class X RESULTS.

    7) That OOS property Class rankings are often different than the Class ranking of the local market they live.

    8) Class A is relatively easy to manage, can even be DIY remote managed from another state. Can usually allot 5-10% vacancy factor and same for maintenance.

    9) Class B usually also okay, but needs more attention from owner and/or PMC. Vacancy and maintenance factors should be higher than for Class A as homes will be older, have more deferred maintenance and tenants will be harder on them.

    10) Class C can be relatively successful with a great PMC (do NOT hire the cheapest!), but very difficult to DIY remote manage. Vacancy and maintenance factors should be higher than for Class A or B. Homes will have even more deferred maintenance and tenants will be even harder on them.

    11) Class D pretty much requires an OWNER to be on location and at the property 3-4 times/week. Most quality PMCs will not manage these properties as they understand most owners won’t pay them enough for the time required and even then it’s too difficult successfully manage them.
    ***Only exception is if an owner has plan & funds to reposition Class D to Class C or higher.

    https://www.biggerpockets.com/forums/776/topics/960183-what-they-dont-tell-you-about-cheap-rental-properties?highlight_post=5562799&page=3#p5562799


     ABSOLUTELY AGREE!!  Mine are in Class A neighborhood.

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  • Samuel Mes
    Member since 2022 · 13 posts · 0 votes
    4y
    Quote from @Joe Martella:
    Quote from @Samuel Mes:

    Also, curious as to how self managing works when you want to go on vacation and switch off for a month and not feel like you're on call 24/7. I guess a property management company for that 1 month can't be too lethal, can it? 

    This is where relationships come in. I recommend you go to your local REIA. Talk to other investors and perhaps you could make them a point of contact when you are a way. You can reciprocate the favor. I just go and deal with issues if/when they come up. I was just away for a week and didn't get any calls.

    You are not going to get a property manager who turns on and off a month here/there.

    That's interesting - I have quite a few relationships with RA agents who are quality. To me, they would seem to make the most sense. Maybe have them be "on call " during thsi time and if something props up, pay them a premium for being available and handling it. 
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  • Account Closed
    OP
    Investor · New York, NY · Member since 2017 · 3 posts · 1 vote
    4y
    Thanks everyone for your comments regarding your experiences self-managing and using property managers. It was helpful to have this pool of wisdom to help me as I decide which route to go and the recent poll added on this subject was a great idea! It's interesting that the majority of voters are self-managers of their properties according to the poll (so far in the results).

    I'm leaning towards using a property manager the more I think about my personal situation with a job promotion and simultaneous relocation to NYC. There are too many moving parts right now to add-on managing my property. Finding an apartment to rent in NYC is a full-time job right now as the market is very competitive and my job is taking up a lot of time right now with more responsibilities. I also have a work trip to Paris in October where I'll be gone almost two-weeks and I don't want any potential issues to worry about with the house. My cousin shared his experience over the weekend renting out his house where he had two good tenants and one "bad" one, which made me nervous about doing it alone and being out of state.

    I plan to interview three property managers and see what their quotes and services are like. I think in the long-run this will be a worthwhile way to go as I value my time and want to invest in climbing higher in my career. Ultimately I'd like to invest in an apartment syndicate within the next year...that's the next big goal!
    0Reply
  • Eliott Elias
    Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
    4y

    I absolutely despise property management. If you have one that may be manageable. But I don't know the fair housing laws by heart and don't have to research how many days do i have to evict someone lawfully if a tenant doesn't pay their pet deposit. Leave it to the experts 

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