Education and news for smart DIY landlords!
There are two types of styles when it comes to managing your rental property. You can do it alone through self-management, or you can hire someone else via professional property management.
Both have different prices, however. In self-management, the cost is your peace of mind and personal time. You also need technical skills to perform repairs/maintenance, knowledge of market pricing, and familiarity with local housing laws.
For professional property management, you need to sacrifice a portion of your profit to have someone else look after your rental. To go in-depth on the pros and cons of each management style and help you choose, read until the end.
Self-management gives you all the power to make decisions about the property. If there is a need for renovation or repairs, you can plan it exactly the way you envision it. You won’t need to consult with anyone else before you implement changes in management and structure.
A close and harmonious relationship with tenants is one of the important key factors to make your property management smooth and easy. The more approachable you are, the faster you can address their concerns. This goes the same with doing monthly inspections. You get to see how they treat your property first hand.
Professional property management services aren’t free of charge. It isn’t cheap as well. By self-managing your rental property, all the profits go to you. With maintenance and repairs, you get to choose the affordable and standard services and materials you want.
For landlords that have a day job or have other important things to do, self-management might not be good. You don’t want to suddenly abandon your activities because a tenant called about a busted water pipe.
This goes the same with other property management tasks as well. So ask yourself, “Can you juggle work, personal, and landlording activities together?” Another thing you need to consider is when you have other properties. If you have multiple rentals, your responsibilities multiply as well.
So for example, you have a problem tenant that doesn’t pay rent on time and damages your property. Not to mention that this tenant causes numerous complaints from the neighbors.
How would you react to it? You can’t kick them out immediately. You’ll need to do a lot of paperwork to legally evict them. Can you handle this kind of stress? If not, then self-management might not be right for you.
Since we were talking about problem tenants, one way to avoid them is to do a proper tenant screening. But, do you know how to do that? Landlording isn’t limited to tenant-relations alone. You also must have repair, maintenance, and costing skills.
Lacking these skills will not only make management hard, but you’ll also lose a lot of money as well.
With a professional property manager looking after your rental you can now give time for your other activities. It can be your day job, your hobbies, exercise, or simply just spending time with your family.
As a new property owner, you might not have the experience to manage your rental. But with a professional property manager, you can assure that your rental is in good hands.
When filling up vacancies in your property, you won’t need to find tenants and do the tenant-screening process. The property manager will do it for you. You’ll just need to relax and watch the catch flow in.
When you leave everything to the property manager, you might not learn how to manage the property yourself. Property managers are well-versed with local housing laws and market guidelines such as proper rental pricing techniques and eviction procedures.
Self-managing will teach you these things. Hiring a manager will take away your opportunity to learn what’s needed to be a landlord.
Professional managers charge 7-12% of the total rental income. If you have the experience, skill, and time to manage your property alone, it will be a waste of money to hire a manager.
There are more things to consider as well whether you should hire a manager or not. If you have a lot of time and a model tenant who doesn’t give you headaches and treats your property well, it is not wise to have your property managed.
To help you choose whether you should hire a property manager or not, first, look at your situation. Consider the value of your time. Do you have a lot of it to handle maintenance, emergency repairs, tenant-searching, and tenant-screening? If yes, then manage your property alone. If you lack the experience, then learn what it takes to be a DIY landlord here:
If you’re ready, make Landlord Prep your go-to resource for landlording education. Here, we offer a complete DIY landlording course to get you on the right track. Join our academy today. If you want, you can check out Flavia’s real estate investing webinar first!