Quote from @Bella Ajayi:
I am closing on my first investment duplex property in two weeks in Ohio area, i live 3 states away. I have received about 15+ bad review from landlords about property manager in the area and how they do a terrible job and ghost their landlord, lose future tenants and just nightmare review so i am thinking about self-managing as an out of state investor to see if i can do it. Is it doable? Am i in over my head. One unit is occupied with a year lease and the other unit tenant will be moving out in May.
What Property management software tools do you use that works best for you?? I was looking into RentRedi, Doorloop, Baselane, Landlordstudio and appfolio softwares. Also, I am looking into hiring a local boots on the ground person and a maintenance/handyman for maintenance needs.
I like baselane so far but i dont want their bank account, i like the credit union bank that i currently have and will like to keep it. but i heard to get the full experience with baselane, you may have to get a baselane affiliated bank with them...idk. I like Rentredi and doorloop too
Has anyone successfully self managed as a Out of state investor and what systems did you create that works best for you. Or should i just get a property manager for 10% and hope for the best. This will be my first property so i am trying to make the best decision for me in this journey.
Self managing is doable if you have all the following:
Efficient way to respond to all the inquiries from your Zillow ad
Someone to show the property, give tenants keys for MoveIn
Rental application (can use Zillow)
Way to collect app fees (can use Zillow)
Process to screen applicants, can use Zillow, but many here have been burned by Zillow's poor screening. Zillow is also terrible at catching fraud.
Compliant lease
Rent payment options for tenants
Someone to do maintenance
Someone to inspect at least annually
Process to track rents and expenses
Knowledge of local eviction laws in case tenants don't pay
Eviction attorney to appear on your behalf in court
Someone that knows Ohio Landlord-Tenant regulations to keep tenants from being in control
Someone to collect keys when tenants leave and do MoveOut Evaluation for security deposit charges and refund
Someone that knows Ohio security deposit laws
Enough maintenance and market knowledge to know Scope of Work to RentReady a unit and not get taken advantage of with unnecessary work expenses.
And more...
What NOT to do:
Hire an agent to show the property AND screen applicants!
- What do they have to lose by approving the first applicant to get their commission ASAP?
Trusting contractors to decide what needs to be done for maintenance or RentReady.
- They have an incentive to do as much work as possible to get the highest amount from you.
Trust tenant excuses for late payments.
- They will lie to stay for free as long as possible
If you decide to hire a PMC, read our copy & paste advice below to avoid hiring a bad one:
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We’re a Property Management Company (PMC) in Metro Detroit ONLY, with 25+ years of experience, and we’ve seen owners make the same mistakes, over & over again when looking to hire a PMC – which drives us nuts!.
In our experience, the #1 mistake owners make is ASSUMING all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY.
So, owners mistakenly think price is the only differentiator – and look for a PMC like they’d shop for groceries☹
We encourage you to learn from the mistakes of others by reading posts here on BiggerPockets from owners that picked a PMC solely by price and regretted it.
We recommend exploring as many sources as possible to get referrals AND cross-reference them to get as much accurate information as possible.
Check out NARPM.com, BP’s Property Manager Finder (BiggerPockets: The Real Estate Investing Social Network), etc.
Even if someone gives you a referral, do NOT make the mistake of assuming that just because a PMC met their expectations, they’ll meet your expectations. We all have our own expectations and what works for someone else, may not work for you.
If you’re new to all of this, it's often a case of not doing enough research, as you don't know what you don't know!
So, ask more questions!
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!
A well written management contract should clearly spell out what is expected of both the PMC and the owner, to PROTECT both and avoid misunderstandings. Why do you think purchase contracts are so long and have such small print?
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😊
Here’s some articles we’ve contributed to BiggerPockets about screening a PMC BETTER than you would a tenant!
20 Questions to Ask When Vetting a Property Management Company: Processes
13 Questions to Ask to a PMC: Communication and Documentation
24 Questions to Ask When Evaluating a Property Management Contract
