Karl B.
Rental Property Investor · Erie, PA · Member since 2015 · 1k+ posts · 2k+ votes
3y
For me, personally, I don't use a property manager because:
1. I do a better job self-managing than any property manager in my town ever could
2. I would much rather keep the 10+% the property manager would be paid
3. With me in charge there aren't overpriced repairs or frivolous upgrades
10 Reply
Michael SmytheBusiness Member
Real Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
3y
DIY property management is the least efficient use of an investor's time.
They get a better return on their time finding & closing deals.
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1 Reply
Nathan GesnerBusiness Member
Moderator
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
3y
It's a personal choice. Some people aren't good at managing property themselves. They don't know how to research the law or enforce a lease. They can't screen Tenants well and accept all the lies and sob stories. They are their own worst enemy and it costs them tens of thousands, sometimes hundreds of thousands, in lost income. Then there's the impact it can have on their sanity and health.
However, a good property manager is also hard to find if you don't do your research. If you find a good one, they can be worth every dime because they protect your property, income, time, and sanity so that you can do other things.
I'll tell you more when my book comes out. ;)
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1 Reply
Gregory SchwartzBusiness Member
Rental Property Investor · College Station, TX · Member since 2016 · 1k+ posts · 1k+ votes
3y
I worked for 3 years a the best property management company in my area. I learned the ropes and got my reps in so that now I can self manage my portfolio. By managing myself I can obtain 50% lower vacancy, 30% lower turn cost and 50% lower management fees (I pay myself 5%), thus lowering my expenses by a metric boat load (technical term) as compared to hiring a 3rd party company to manage for me. Our goal is to grow large enough that we can hire employees to run our rentals for us.
In my opinion, between 1 and 5 rentals can be easily self managed and the idea that "no one will care about your properties like you do" is true.
Between 6 and 75 rentals its likely best to hire a property manager. The time requirement is too great and the per hour cost is relatively low.
Over 75 you can consider bringing it in house and hiring someone to manage your portfolio the way you want it managed.
Each persons experience, available time, portfolio size, and REI goals are different. So you have to decide for you which is best.
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4 Reply
Mackaylee BeachPro Member
Real Estate Agent · Kansas City, MO · Member since 2020 · 1k+ posts · 492 votes
3y
Personally, I think that PM's are highly helpful and beneficial and you hold a large-scale portfolio. Having someone collect your rent and deal directly with the tenants saves you time and allows you to focus on other things like searching/purchasing more properties!
I've used a PM in the past, worked out great for me. Definitely do your research in trying to obtain the best PM fit for your needs.
[email protected]
0 Reply
Ian WalshBusiness Member
Lender · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
3y
A property manager can make or break a rental property. The right one is worth it especially when you get above 10 properties. The wrong one will make 1 property feel like 100 .
2 Reply
Kirsten Wright
Member since 2022 · 14 posts · 2 votes
3y
@Gregory Schwartz. What if I am an out of state investor and have some "feet on the ground" as far as giving me names of contractors and such, but not to do more than that. Do you think it is wiser to self manage a Tennessee rental while I live in Ca? Paying 1st month's rent and 10% each month tallies up to $385/month when you average it out. That is a lot of money.
1 Reply
Tim Bratz
Developer · Charleston, SC · Member since 2015 · 100 posts · 91 votes
3y
If you're running a business AND managing properties, you're running yourself into the ground. The highest and best use of your time is sourcing deals and sourcing cash. Build a team internally that can handle property management or outsource it to a third party you trust.
0 Reply
William Lynam
Real Estate Agent · Cincinnati, OH · Member since 2016 · 33 posts · 6 votes
3y
@Kirsten Wright, Shop around for rates. At Guardian Asset Management, we charge 8% and half of first month rent as a placement fee. We like to save our clients money anywhere possible.
0 Reply
Kirsten Wright
Member since 2022 · 14 posts · 2 votes
3y
@William Lynam Thank you so much!

0 Reply
Kirsten Wright
Member since 2022 · 14 posts · 2 votes
3y
@Nathan Gesner. Do you have any good connections in the Knoxville area? :-)
0 Reply
Matthew Cope
Investor · Nixa, MO · Member since 2016 · 20 posts · 14 votes
3y
I've used property managers since the beginning of my investing journey and it's been well worth the 9-10%. Most of my properties are where I live, but I do have a 4-plex over 2 hours away. I wouldn't be able to manage that property properly if I was doing it myself.
I went through my first eviction a few months ago. The property managers handled everything. They handled the paperwork IAW the local and state laws, took the tenant to court, and eventually retook possession of the unit. The only thing I had to do was agree to start the process. We paid for the court fees, which equalled around $300, but the PM filed all of the appropriate paperwork so the tenant (that was evicted) will have to pay us for those legal fees in order for them to rent again. Our eviction was seamless because of the PM. I'm a big fan.
With that being said, definitely spend time finding the right fit for a PM. I've had a really bad one, and it made owning a property painful and took a lot of my time.
0 Reply
Greg H.Pro Member
Moderator
Broker/Flipper · Austin, TX · Member since 2013 · 4k+ posts · 4k+ votes
3y
Seems like the consensus this for is pro PM. I will go the other way. I have 30+ rentals that I manage myself often times from 1000+ miles away or outside the country. However I am also a broker/flipper and have my own crew to use for renovations and major repairs. The reason I would not use a PM are:
-No one will care about my property more than I will
- I have the knowledge to analyze repairs and what the cost should be. For instance, many here would say the cost To replace an a/c system would be $10-12k. The unit itself is under $4000.
-I utilize Facebook, Zillow and Avail to rent my properties. I have not had a property vacant more than 30 Days in 30+ years
My guess is I save $50,000 a year by spending a Couple of hours per week
4 Reply
Colleen F.Pro Member
Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
3y
@Katelin Eberhard I had one and they were bad. I can minimize vacancy better than they did. The cost was relatively high compared to what they did. They upcharged repairs quite a bit and did not use preferred vendors.
We will be a greater distance from our rentals and our local backup has left so we are deciding between a PM and a handyman type person at present.
0 Reply
Paul S.
Member since 2023 · 13 posts · 2 votes
3y
One type of "agency cost" is that the agent (i.e. property manager)'s interests are not fully aligned with the owner. To the owner, it is their property. To an agent, it's a job.
Plus, hiring a manager does not necessarily mean the owner can be hands-off. You still need to manage the manager.
0 Reply
Nathan GesnerBusiness Member
Moderator
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
3y
Quote from @Kirsten Wright:

@Nathan Gesner. Do you have any good connections in the Knoxville area? :-)

I don't. I know there are some NARPM members out there, but I can't personally vouch for their abilities.
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0 Reply
Arpit Guglani
Investor · Bay Area, CA · Member since 2022 · 20 posts · 3 votes
3y
Quote from @Kirsten Wright:

@Nathan Gesner. Do you have any good connections in the Knoxville area? :-)

+1 - I am currently in Knoxville and invested in SFH here, but will be moving away eventually. Would love some good and affordable PM contacts as well.
0 Reply
Konstantin GinzburgPro Member
Member since 2021 · 376 posts · 242 votes
3y
@Katelin Eberhard
We have 3 properties that we self manage and one that we use a property manager for. The main thing that helps us determine whether or not to use a property manager is how much of our time is required to maintain and manage that property. If we have difficult tenants that either need constant management due to either chasing them for rent or repairing damage they cause; then we use a property manager in this case so that we are able to protect our time. The property we use a manager for is in a C class neighborhood which is the likely reason it requires so much time to maintain. Our other properties are in sold B or A class neighbors with tenants who are more self sufficient and proactive about taking care of the property and paying rent on time so they do not require a large time commitment. As a result, we are easily able to manage these rental units on our own without a property manager.
3 Reply
Kirsten Wright
Member since 2022 · 14 posts · 2 votes
3y
@Greg H.How did you build your contacts when you are not living in the same state as your property? Did you have friends in the area?
0 Reply
Andrew Robinson
New to Real Estate · Woodstock, GA · Member since 2023 · 15 posts · 7 votes
3y
Quote from @Kirsten Wright:

@Nathan Gesner. Do you have any good connections in the Knoxville area? :-)

It is possible to build a local team. I'm part of a network of over 500 property managers. Many of us manage or own properties long distance. In fact using systems to facilitate this also allows you to scale. This is a situation where you make your money work for you.
0 Reply
Andrew Robinson
New to Real Estate · Woodstock, GA · Member since 2023 · 15 posts · 7 votes
3y
Quote from @Colleen F.:

@Katelin Eberhard I had one and they were bad. I can minimize vacancy better than they did. The cost was relatively high compared to what they did. They upcharged repairs quite a bit and did not use preferred vendors.
We will be a greater distance from our rentals and our local backup has left so we are deciding between a PM and a handyman type person at present.

@Colleen F.what strategy do you use for this property?
0 Reply
Andrew Robinson
New to Real Estate · Woodstock, GA · Member since 2023 · 15 posts · 7 votes
3y
Quote from @Arpit Guglani:

Quote from @Kirsten Wright:

@Nathan Gesner. Do you have any good connections in the Knoxville area? :-)

+1 - I am currently in Knoxville and invested in SFH here, but will be moving away eventually. Would love some good and affordable PM contacts as well.

I would love to help you find someone. Feel free to reach out.
0 Reply
Daniel B.
Rental Property Investor · WA AL, FL · Member since 2021 · 16 posts · 46 votes
3y
Quote from @Karl B.:

For me, personally, I don't use a property manager because:
1. I do a better job self-managing than any property manager in my town ever could
2. I would much rather keep the 10+% the property manager would be paid
3. With me in charge there aren't overpriced repairs or frivolous upgrades

I agree 100% with this ^^^. We have 5 relatively new SFH's in solid B neighborhoods with high income and credit requirements. Our tenants stay longer, take better care of our properties, and are more motivated to maintain their good credit. We call this the 'hassle' factor and by acquiring better properties in better neighborhoods, we get 'better' tenants, which minimizes the hassle. All of that to say, we don't spend a lot of time dealing with tenants/home repair/turnover/etc. - so far.

Another factor for us is that we want REI to be as passive as possible when we retire, so without a PM we plan to limit the size of our portfolio to between 5 and 10 total properties.
1 Reply
Colleen F.Pro Member
Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
3y
@Andrew Robinson we currently self manage but are looking at options for the near term. I would like to find a handyman in the area to handle calls when we aren't in the area. I can handle the tenants. We tend to look for long term tenants who have ties to the area. They don't move as much.
0 Reply
Brittany Perkins
Property Manager · Cleveland, OH · Member since 2023 · 16 posts · 5 votes
3y
Good Morning,
I think the main question to be asked is: Do you have the time to self manage?
There can be a lot that goes into managing a property, such as: tenant communication, rent collection, leasing and tenant screening, maintenance, etc. Hiring a property management company is hiring a service to handle these items for you to take the stress out of handling yourself.

0 Reply

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