Looking for suggestions on how to find part time help!

[Jeff Ausdemore]

Hello everyone!

I'm thrilled that we've grown to this point in our portfolio, but we are now up to 10 single family homes, and with other (more than) full time jobs, we are desperately looking for some help from someone that can help us track rents, walk throughs (property upkeep), etc.
We have done an excellent job up to this point, but it is not sustainable, since we travel for work, and our tenants need more communication/attention.

Any suggestions/thoughts here?

Thanks in advance,

JA

[Eliott Elias]

Hire a property manager 

[Nathan Gesner]

Quote from @Jeff Ausdemore:

I agree with Eliott and wish to expand: if you think it's expensive to hire a professional, try hiring an amateur.

You probably think it's ridiculous to pay a property manager 10% of rent. That's because you don't understand the value of a good manager. They know the law and can keep you out of trouble. They know the market and can get top-dollar rent and reduce vacancies. They have policies and procedures in place that nip problems in the bud quickly to save you money and stress. In my experience, a professional property manager can put as much - or more - money in your pocket every year while freeing you up for other things.

Cheaper doesn't mean you'll make more money.

Start by going to www.narpm.org to search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start. You can also search Google and read reviews. Regardless of how you find them, try to interview at least three managers.

1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their staff qualifications.

2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.

3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate, particularly if you have a lot of rentals.

4. Review their lease agreement and addenda. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.

5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance, late rent, evictions, turnover, etc. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that policies are enforced equally and fairly by their entire staff.

6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact that a tenant is complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.

7. Look at their marketing strategy. Are they doing everything they can to expose properties to the widest possible market? Are their listings detailed with good quality photos? Can they prove how long it takes to rent a vacant property?

This isn't inclusive but should give you a good start. If you have specific questions about property management, I'll be happy to help!

[Drew Sygit]

@Jeff Ausdemore can already tell that you will ignore advice from @Eliott Elias and @Nathan Gesner and will stick to your DIY guns - even if you're being penny-wise & dollar-foolish.

You can separate your labor problem into two:

1) Admin Labor: create SOP videos showing how you want things done. Hire an offshore VA to implement

2) Field Labor: many real estate agents are seeing business slow and will soon be "starving". Hire one of these to execute your SOP videos.

[Jeff Ausdemore]

Quote from @Eliott Elias:

Hire a property manager 

 Thanks for the detailed analysis, thorough reflection and valuable insight into our decision @Eliott Elias! :)

All kidding aside, that's what we are weighing here, and need practical options.

Thanks,

JA

[Jeff Ausdemore]

Quote from @Nathan Gesner:

Quote from @Jeff Ausdemore:

These are excellent points here @Nathan Gesner, and several are new to me- thank you for taking the time to go into detail for me to explore. I'm going to take your advice and start with NARP, and go from there.

Thank you!

JA

I agree with Eliott and wish to expand: if you think it's expensive to hire a professional, try hiring an amateur.

You probably think it's ridiculous to pay a property manager 10% of rent. That's because you don't understand the value of a good manager. They know the law and can keep you out of trouble. They know the market and can get top-dollar rent and reduce vacancies. They have policies and procedures in place that nip problems in the bud quickly to save you money and stress. In my experience, a professional property manager can put as much - or more - money in your pocket every year while freeing you up for other things.

Cheaper doesn't mean you'll make more money.

Start by going to www.narpm.org to search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start. You can also search Google and read reviews. Regardless of how you find them, try to interview at least three managers.

1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their staff qualifications.

2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.

3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate, particularly if you have a lot of rentals.

4. Review their lease agreement and addenda. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.

5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance, late rent, evictions, turnover, etc. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that policies are enforced equally and fairly by their entire staff.

6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact that a tenant is complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.

7. Look at their marketing strategy. Are they doing everything they can to expose properties to the widest possible market? Are their listings detailed with good quality photos? Can they prove how long it takes to rent a vacant property?

This isn't inclusive but should give you a good start. If you have specific questions about property management, I'll be happy to help!

[Jeff Ausdemore]

Hey @Drew Sygit,
While your assumption about me "ignoring" advice is incorrect, the idea of using the 2 different points of leverage are great. I'm actually researching the VA option for me personally now anyway, so I'm looking into doing the same for our REI company.

Thanks for your excellent (albeit very presumptuous/snarky) suggestion.
JA


Quote from @Drew Sygit:

@Jeff Ausdemore can already tell that you will ignore advice from @Eliott Elias and @Nathan Gesner and will stick to your DIY guns - even if you're being penny-wise & dollar-foolish.

You can separate your labor problem into two:

1) Admin Labor: create SOP videos showing how you want things done. Hire an offshore VA to implement

2) Field Labor: many real estate agents are seeing business slow and will soon be "starving". Hire one of these to execute your SOP videos.

[Eliott Elias]

Quote from @Jeff Ausdemore:

Quote from @Eliott Elias:

Hire a property manager 

 Thanks for the detailed analysis, thorough reflection and valuable insight into our decision @Eliott Elias! :)

All kidding aside, that's what we are weighing here, and need practical options.

Thanks,

JA

 You're welcome

[Drew Sygit]

@Jeff Ausdemore you didn't mention anything about PMC's, which would logically be the easist solution to your challenges, so logically, why would we assume you were considering hiring one?

If you are, then read on:

Even if someone give you a referral, what meets their expectations, may not meet yours.

In our experience, the #1 mistake owners make when selecting a Property Management Company (PMC) is ASSUMING instead of CONFIRMING.

It's often a case of not doing enough research, as they don't know what they don't know!

Owners mistakenly ASSUME all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY, so price is the only differentiator.

So, the first question they usually ask a PMC is about fees - instead of asking about services and HOW those services are executed.

EXAMPLE: PMC states they will handle tenant screening – what does that specifically mean? What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.? You’d be shocked by how little actual screening many PMC’s do!

This also leads owners to ASSUME simpler is better when it comes to management contracts.

The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it!

We have a 14-page management contract that we've added our real experiences to over the years, with the intent of protecting both us AND the landlord. Beyond the Monthly Management, Placement & Maintenance fees, all other fees in our contract are IF EVENT -> THEN fees.

We don’t know any PMCs to recommend in the area mentioned, but since selecting the wrong PMC is usually more harmful than selecting a bad tenant, you might want to read our series about “How to Screen a PMC Better than a Tenant”:

https://www.biggerpockets.com/member-blogs/3094/91877-how-to-screen-a-pmc-better-than-a-tenant-part-1-services-and-processes

We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

P.S. If you just hire the cheapest or first PMC you speak with and it turns into a bad experience, please don’t assume ALL PMC’s are bad and start trashing PMC’s in general. Take ownership of your mistake and learn to do the proper due diligence recommended above😊

Please send us any feedback via email, as we do not use the DM feature here.

[Nate Eazor]

Hey Jeff, I know a great property manager in the area -- would be happy to connect!