
Have you ever received a call concerning a clogged toilet in the middle of the night? As a landlord, it's a situation you may have encountered. It's a common dilemma: should you oversee your property management personally or engage a professional property manager to handle these types of issues? Let's explore the options to determine the most suitable approach for your specific needs.
Why Go DIY? You'll Save Money… Maybe
One of the main advantages of self-managing a property is the potential for higher financial returns, as you can avoid paying the typical 8-12% fee to a professional manager. However, it's important to consider the trade-off. Instead of that expense, you'll be investing your own time to handle various responsibilities such as tenant concerns, maintenance coordination, and regulatory compliance. It's worth reflecting on how you value your personal time.
For instance, would you be comfortable dealing with a burst pipe during your leisure time? This approach requires careful consideration of your priorities and the value you place on your own time versus the cost of hiring professional help.
You're in Control
Do you love having the final say on everything? With self-management, you decide on tenants, set the rent, and choose the contractors. Say you're renting out your old family home - you can ensure the grass stays green and the house gets the care it deserves. On the other hand, property managers might not sweat the details you're emotionally attached to.
You Can Maximize Revenue in Creative Ways
When you're in charge, you can get creative about income. Rent the garage separately, charge for storage, or hunt down the cheapest repair materials. These minor tweaks can add up. For example, renting out a garage for $75 a month might not be worth a property manager's time, but it's extra cash in your pocket if you're handling it yourself.
Where DIY Falls Short
Emergencies Don't Take Vacations
You're at dinner with your family or halfway through a vacation, and your tenant calls. The heating's out, or the sink's leaking. If you self-manage, the buck stops with you. There's no one else to pick up the phone.
Laws and Regulations Are a Lot
Did you know that local rental laws change often? Ensuring adherence to tenant rights, safety codes, and lease regulations is indeed a substantial responsibility. It's important to consider whether your current lease agreement sufficiently protects you. If there's any doubt, it's possible that you might face legal challenges. Investing in a property manager's services for a year may be more cost-effective than hiring a legal professional to address issues arising from a non-compliant or poorly constructed lease.
The Emotional Trap
Developing a close relationship with tenants when managing properties on your own can sometimes lead to challenges, such as extending rent grace periods during difficult times. This well-intentioned approach might result in financial strain for the landlord, potentially amounting to a significant sum like $5,000. Employing a professional property manager serves as an intermediary, maintaining a consistent and business-like approach to rent collection, which helps avoid such complex situations.
Tenant Screening Isn't as Easy as Googling
You can search someone's name online, but that's no replacement for a thorough tenant screening. Many self-managers skip background checks or let a good sob story sway their decision. The result? Problematic tenants who could cause more headaches down the road.
Why Hire a Property Manager?
Their Expertise is Invaluable
Skilled property managers are well-versed in the intricacies of rental properties. They possess the know-how to manage situations ranging from small fixes to significant emergencies. Rather than searching for advice on tenant payment issues, you can rely on their seasoned experience.
Enjoy Peace of Mind
When you delegate to a property manager, you're entrusting your rental responsibilities to someone who can effectively manage tenant communication and coordinate maintenance. This means that instead of dealing with calls, complaints, and organizing repairs, you can allocate your time to other priorities. Moreover, they maintain a reliable network of service providers, ensuring swift and proficient responses to maintenance needs. This can save you from the frustration of waiting for days to hear back from a tradesperson.
Streamlined Finances
Envision receiving a comprehensive monthly financial statement for your property, clearly presenting all income and expenses. This approach eliminates the need for last-minute, stressful bookkeeping sessions with QuickBooks. Additionally, during tax time, your records will be meticulously organized for your accountant's review.
Legal Protection
Property managers stay updated on rental laws and ensure you're compliant. From fair housing rules to safety codes, they've got it covered. This means fewer chances of legal issues and more peace of mind for you.+
Downsides of Hiring a Pro
You're Not the Only Client
A property manager splits their time between your property and others. If your rental is quiet, it might not get much attention. This could mean minor issues, like a slow leak or a tenant planning to leave, go unnoticed.
Less Customization
Property management companies have systems in place to keep things efficient. However, if you want something done differently, like handling maintenance yourself, it might not be possible.
Communication Can Be Slower
Got a question about a repair? Your property manager might need to check with the maintenance team, who then checks with the vendor. It's not as fast as doing it yourself.
What's Right for You?
Self-management can indeed be a suitable option if you are detail-focused, possess ample time, and derive satisfaction from being closely involved with your investment properties.
However, if you are currently managing a demanding full-time job alongside several properties, or you simply wish to avoid the administrative tasks and stress that come with property management, it may be advisable to consider employing a professional property manager.
This is where the expertise of Concept 360 Property Management truly shines. We are adept at navigating the complexities of managing properties in a dynamic and busy urban environment such as Long Beach, which can be quite challenging.
What's your decision? Feeling prepared to handle it personally, or is it more suitable to seek professional assistance and give us a call?