Property managers, do you allow owners to perfrom repairs?

Question

Property Managers, do you allow your owners to make repairs to the property while tenant occupied? I'm not talking discretionary remodels, but needed repairs.

In the past, I have preformed some repairs to a rental that was under management. For example, one property had a collapsing sewer line. Plumbers were quoting 12-14K to replace a 50' sewer line 2' deep. Since the line was still functional, I had time to perform a permitted repair. I hired a licensed excavation guy, installed the replacement pipe, and had the city inspection done on day 1 and the line was function that evening. There was a portable toilet on site for the tenants to use. Got it done for less than 2k in 2 days. The 2 companies I have worked with never had a problem with this. But I'm finding that some property managers will not allow you to preform a repair on a tenant occupied property under any circumstance. I understand that point too. Some folks don't know what the hell they are doing, cut corners, take too long and expose the property manager to potential liability. What's your policy?

Allan Smith · Answer

At the end of the day it's the owner's decision who does what repairs.

Nathan Gesner · Answer

I highly discourage it, but I do allow it. I'm in a small town where vendors are often unable to respond quickly. I have one owner with 50 rentals, he owns a renovation company in another state, and is a licensed HVAC/GC here locally, so it's nice when he can knock out the work himself, quickly and cheaply.

HOWEVER...I regularly have problems when he exchanges phone numbers with tenants or talks to them. Next thing I know, the tenant has three dogs or paints a living room all black. They tell me the Landlord said they could do it, the Landlord tells me a different story, and I'm stuck in the middle trying to enforce a lease and protect the Landlord from himself.

Best practice: only allow the Landlord to do the work if they agree to not exchange contact information or speak with the Tenant about anything that may affect the lease. If they want to talk about work, dreams, family, and be best of buddies for 30 minutes, I could care less. But if the Tenant starts to talk about the lease, in any way, the Landlord needs to shut it down and point them back to the PM where we can control things.

Bob S. · Answer

You can do whatever you want its YOUR property, I PM about 500 doors, 99% of the owners allow us to handle all. Our prices are always better than what they can get on their own. Not sure who did your sewer line for 2k, but I have done about 50 and they all are from 6k- 10k,

All the best

Phillip Austin · Answer

The policy is we try to avoid it as much as possible. We're allowing someone into the property that we ourselves don't manage. Any number of things could happen but we absolutely lose some effectiveness and ability to manage which is why many PMs don't allow it.

Many owners want to cut cost by doing it themselves which I'll allow. However, if it becomes an issue, I'll have a direct conversation with the owner and try to compromise in some way. If the owner insists and the issues persist, I'll consider firing the owner and terminating the management agreement

Drew Sygit · Answer

@Tom Fidrych We have custom fields in our PM software to track owners that insist on doing their own work or using their own contractors.

OWN WORK: we dont allow on occupied units as too many issues with tenants getting owner number and bypassing us. Also, too much liability if they screw something up and we ALL get sued.

OWNER CONTRACTOR: only allow on occupied units if they are properly licensed and insured, otherwise to much potential liability. If vacant, we may suspend our management if they are NOT properly licensed and insured for same issues.

Eliott Elias · Answer

If they sign a liability waiver than yes.

Bob Collett · Answer

I generally do not think it is a good idea to have the owner do work himself or hire their own contractors. Since I only markup maintenance by 15%, there is no real savings for the owner. If the owner wants to do so, we would talk about it, and then I would most likely allow it. If the reason is because they want to save the 15% mark-up, then it is probably an indication that the owner needs a new management company.

Years ago, one of my owners wanted to hire their own guy to do carpeting to save money. When the work was done, we had a big mess to clean up as the carpet company left all of the carpet on the front porch :)

However, if the owner tells me that his uncle is a licensed electrician or plumber, and wants to do the work... I am happy to give it my blessing; since I really don't make money with a 15% mark-up.

Bob Collett, Collett Property Management

Brandon Sturgill · Answer

@Tom Fidrych its hard to improve on the post by @Nathan Gesner

We have never had this work well...if this is your operating style there is nothing wrong with doing repairs yourself...you may be better off with flat fee management services...a focus on admin and bookkeeping tasks...or maybe a platform like Stessa...I'm sure there are 100 PM apps out there that just do the back-office type stuff.

If you do reach an agreement with a manager on this, just make sure all the bases are covered with proper documentation

Best of luck

Richard F. · Answer

Aloha,

If the Owner wants to do it, we will not pay through the Owner account to reimburse him for materials or labor. He pays all out of pocket, and is fully responsible for any issues that arise. On detached homes its not a big deal, but in a mid to high rise condo, Highly Discouraged!

Property managers, do you allow owners to perfrom repairs?

Property managers, do you allow owners to perfrom repairs?

Most Popular Reply

10 Replies