A property manager told me his owners are worse than his tenants. Is he wrong?

Question

I've been talking to property managers for a few weeks, mostly smaller shops. I assumed tenants would be the worst part of the job. Every one of them said tenants are manageable - it's the owners that wear them down.

One gets the same question three weeks after the fact about a repair he already handled. Another said monthly reporting eats more of his week than anyone realizes. A third was blunt: the experienced investors are easy, and the hardest ones are the people with one or two doors who want to argue about every $300 invoice.

So, owners - they're basically saying you're the problem. Fair?

Shiloh Lundahl · Answer

@Shai Zisman it is not the owners that is the problem. It is the lack of alignment of goals. The owner wants to minimize costs (including property management fees) and maximize profits. The property manager wants to maximize their profit and minimize their costs too. But maximizing the property manager's profits often means lessening the owner's profits.

What I find that works better than a property manager is finding a great project manager/personal assistant. But it only becomes worth it at scale meaning it only becomes cost effective when you have portfolio of 10 or more properties and that would only be part time. One thing that is great about this is that you have aligned goals. Your priority becomes the priority of your assistant. You both have the goal to maximize your profits.

Chris Seveney · Answer

I can believe this, as many owners think it is the property manager's problem if a tenant destroys the unit or heavy winds knock a tree down, which causes a roof fix or the 20-year-old HVAC system to clunk out. Now I have worked with some property managers who are the worst of the worst and do not respond to tickets or fix things and overcharge for everything. There are also a lot of owners who will go on the cheap and not want to fix things right so when it consistently breaks they blame the property manager

Igor Ganapolsky · Answer

i self-manage so i'm basically the owner the PMs are complaining about. and honestly? fair.

when you only have a few doors every dollar matters a lot more. you're not looking at a $300 repair as a line item in a portfolio report. you're looking at it as the difference between cash flowing that month or not. so yeah, you ask questions. and yeah, sometimes you ask them more than once because you forgot or you want to understand the pattern, not just the one charge.

but here's what i've noticed since i started doing this. the owners who are "the worst" are usually the ones who care the most about their business. they just don't have the systems yet. i went through a phase where i'd get a repair notice three days later and have no idea what happened. felt like i was the last to know about my own property. once i set up a simple spreadsheet tracking every request and its status, most of that anxiety went away. not because the PM changed, but because i could see what was happening.

i think a lot of PMs mistake "owner doesn't have visibility" for "owner is difficult." if you send a two-line update after a repair - what broke, what you did, what it cost, before or after - that owner probably stops being the one who calls three times. they just want to know someone's handling it.

Adam Bartomeo · Answer

Owners and tenants are never a problem. The problem is when a PM does not have the proper systems in place. This reduces the number of touches that are needed. Owners will normally do the research but if they cannot find the answer they have to call or text. Also, talking with three PM's is not a large enough sample size. There are lots of PM's out there and about 90% are poo...

Jim Johnson · Answer

There's some truth to it, but I wouldn't say owners are "worse." Tenants and owners just create different kinds of work, A tenant calls because something needs to be fixed. An owner may want to know why it broke. why it cost $300, whether you got another quote, and why they weren't called first. None of those are unreasonable questions, but when expecations around repairs, approvals and communication aren't clear from the beginning, that relationship can become a lot more work than managing the tenant.

Brett Nachbor · Answer

I can see each side of this to a large degree. When I worked for a lender, I conducted hundreds of multifamily property inspections for assets on our books. Probably the #1 complaint I heard from PM's, to there credit, was a lack of investment by the owner into the property. The PM was being forced to "do their best" to maximize revenue, increase occupancy, etc. for a property that was steadily becoming less competitive because of a lack of investment from ownership. These PM's were often glad to see us on-site; while we weren't there to advise and manage the borrower's capital expenditures plan of course, we could definitely influence and even enforce some capital investments to a degree if the property condition was not at least in-line with the condition at the time we underwrote it. Property condition was a MAJOR sticking point the last few years, particularly at the Agencies.

Patrick O'Sullivan · Answer

I can definitely see both sides. A $300 repair feels very different to someone with one or two rentals than it does to someone with a large portfolio. Smaller owners naturally scrutinize expenses more because each one can materially affect that month’s cash flow. The problem starts when reasonable oversight turns into micromanagement. A good PM should provide enough transparency that the owner doesn’t have to chase answers, and a good owner should give the PM enough authority to actually manage. Most of the friction probably comes down to setting clear expectations upfront around repairs, spending limits, communication, and reporting rather than owners or PMs inherently being the problem.

Steven Meyer · Answer

Both things are true at once, and I say that as someone who sits on both sides of it. I run a management company and I also own and operate rentals, so I have been the owner asking the annoying question and the operator answering it.

When an owner feels like the problem, it is almost never that they are difficult people. It is that expectations were never set and the owner has no visibility, so anxiety fills the gap. The owner asking about a repair three weeks later is not trying to be a pain. They just never got told it was done, so it is still an open loop in their head. The one arguing about a $300 invoice usually is not cheap, they just cannot see the context, so every expense feels like a surprise. Those are communication and process gaps, and they are the manager's to close.

The experienced investors are not easy because they are nicer. They are easy because they already know how this works, so the expectations are baked in. The one and two door owners have not learned that yet, and part of the job is teaching them without making them feel dumb for asking.

Two things fix most of it. First, set expectations hard at onboarding: what we handle without asking, what needs your sign off, when you hear from us, and what reporting looks like. Second, over communicate on the small stuff early. Send the quick note that the repair is done before they ask. And the reporting that eats a manager's week is usually reporting built for the manager, not the owner. Build it so an owner opens it and immediately sees their money, and the questions drop off.

So no, owners are not the problem. Misaligned expectations are, and closing that gap is the actual service we are selling.

Drew Sygit · Answer

What about owners that expect their PMC to "play bank" and loan them money for repairs and take it out of future rents?

Pretty much illegal in most states.

Jay Hinrichs · Answer

U bet I have seen this many times.. beginner investors are lazer focus on their one or two deals and want to micro manage. WE see it in the forums were an investor will make a post about a 200 or 400 dollar item like its the end of the world.

Also keep in mind those that can afford to buy rentals generally if they are buying starter rentals have a completely different life experience than a life long renter or section 8 renter. They have no clue on how that part of society lives and gets through a typical month financially speaking.

I mean they live in their homes and the vast majority I doubt have to change out their carpets in one year of living in their home or have pest and rodent problems within 3 months of living there or clog the plumbing up by flushing stuff we know not to flush etc etc.

In addition on the PM side if they are of any size 500 or more doors there is not time in the day to physically view each of these homes they just have to react to tenants repair e mails or calls etc. Some PM's do charge for quarterly visits I would be interested to know of PM's on this site if they do that and how many folks actually will pay for it.. you know dont want to mess up your spreadsheet return by spending money that was not allocated when you made the investment.

Depending on Neighborhood owners have no clue how much risk they take on for having a turn over and a vacant house.. get stubborn with tenant and PM tenant leaves and now you are vacant a target and have a turnover. we see people on this site have a fit because the tenant did not pay their 50 dollar co pay and others go to right to evict the bad tenant.. Then proceed to have a turn over a few months of vacancy and your condenser unit gets stolen.

A property manager told me his owners are worse than his tenants. Is he wrong?

A property manager told me his owners are worse than his tenants. Is he wrong?

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