All Forum Posts by: Kenny Dahill

I think far too often residential investors are focused on ROI, you can utilize IRR for a better calculation of what your entire rate of returns will be when factoring in the duration you held the asset. As a former institutaional commercial developer, IRR was our KPI that determined when to sell.

@Paul Cumming, unfortunately PM's have a lot on their plates and most are not responsive if it isn't an emergency.  I'm not saying all are like that, but from my experience I get about 20% who call me back after the 1st message.  I would advice you to keep calling them since this is an important item to address for your needs.

Or if time zone is really off, email them.  A lot prefer email anyways.

Wow @Paul Cumming!  Fans should only cost you $100-150 for fixing or replacing fans.  I have never heard of fans having "low or high speed' wires either, at least in Arizona it is all internally driven on the fan with a small switch on the device.  Perhaps it is some extremely old type of fan, in which I would advice you to spend the $200 to buy a modern fan and avoid any further wire re-switching. 

15% service fee is extreme.  Most PM's do not charge a service fee, or if they do it's not 15%!  What is their max spendings without owner permission?  Average is typically $250-500 before requiring owner's permission.

Sounds like you got taken advantage of with no only the pricing but also increased pricing to get more services fees as well.  Doesn't seem like an honest PM to me, you need to address that with them ASAP.

Hi @Mike Montana, are these properties you currently own or you are searching to buy?    

I ask because 12 to 50 units is a dramatic difference. There are PM firms that specialize only in MF, often 20+ units. There are PM firms that primarily handle SFR and are willing to go up to a certain quantity of units, often 10-20 units.

Just curious so you can get the proper introductions you will need.

Sounds like you might have more than one property.  If so, try out both for a while to see if hiring out truly bothers you in regards to the control.  If it doesn't bother you, then sign up the remaining properties for management.

Often the hardest parts are giving up control and giving up revenue.  With a good PM, you'll eventually get used to that feeling.  Some people get sticker shock with fees, if you haven't already calculated I would suggest 16-18% AGI for management fees.

Hi @Christian Becker, I have spoken with quite a few PM's in the Cleveland and Akron areas.  A common theme among most PM's in Cleveland is it depends on the property, location and owner.  B-C neighborhoods could very well be different PM's than the Section 8 C-D neighborhoods.

I suggest you pick which you are interested in investing and find that type of PM.  Also, it is common for management fees to be higher for the C/D tenants than B/C because they often require more effort for tenant placement and rent collection.  Something to consider as well.

@Bryson Cox, if you are worried that your vacancies are below market there could be a couple of reasons for that.  Are your rents higher than market?  Or some of those highly occupied properties might purposely have below rents.

If you are truly worried about vacancy and lack of incentive, make an incentive! Work out a pref/promote with them so if they hit certain ROI milestones they get a cut of the action. Not only does that engage them to beat vacancy but also get more rent! If that fails to produce any results then you'll figure out real quick whether it's crummy service or crummy property.

Investors complain about having to manage my managers.  No you don't.  You have to incentize your managers!

Congrats @Account Closed!  I have heard good things about Milwaukee and it improving for investors.  Foxcom moving there is commonly referred as a attraction of jobs for younger generation.

Congrats @Stanley Spencer Alcorn!  Sounds like you don't have an option in Nevada due to the distance restriction.  But in general real estate is all about being honest to yourself and comfortable.  Especially if you are going to self-manage from a distance, you should feel confident in the team you have locally.

Hi @Ethan Porter, what size of small multifamily are you referencing?  Also, do you intend for it to be section 8 or any other type of special managing.