I own a small portfolio of 4 single-family rentals in Michigan (older, workforce housing). All were purchased cash and professionally managed by the same property manager for a few years. For the most part, 3 of the 4 properties have been stable with long-term tenants and consistent cash flow.

However, one property has turned into a nightmare:

• First tenant was a professional tenant and stayed in the property for months without paying rent, and before they got evicted they destroyed the entire kitchen/basement.
• Next tenant of ~4 years suddenly developed hoarding issues → property ended up filled floor-to-ceiling with debris, and turnover required full cleanout + rehab
• After spending a few thousand on the cleanout, PM communicated via email: “cleanout done, just need paint etc.” before getting a 5 figure bill
• No estimates, no budget, no approval requests

After the work was completed, we were presented with:

• ~$20k+ in repair costs without proof (pictures, receipts)
• No prior authorization (our agreement requires approval >$200 unless emergency)
• No staged updates as scope expanded
• No clear reconciliation of costs

This single event wiped out most of the portfolio’s profits and pushed the property deeply negative.

PM’s position is essentially:

• “This is normal for older, low-income housing”
• “Repairs needed to be done regardless”
• “Tenant issues (hoarding, mental health) are unpredictable”

My questions for the group:

1. Is this level of spend (>$20k, >100% of annual rent) ever considered normal without owner approval?
2. How do professional PMs typically handle scope creep during rehabs?
3. At what dollar threshold do you expect a PM to stop and get explicit approval?
4. Is this more of a “bad situation” or a “bad property manager”?

What advice do you have if you were in my shoes? Appreciate any insight — trying to figure out whether this is part of the business or a sign I need to make a change.

Thanks in advance.