Property Management Entrepreneur

[Maliq Hill]

Hey, once this quarantine is over, I'll have a few grand saved up, and I was planning on using it to buy a house hack property, but recently, I've been thinking of starting a Property Management Company. I think it'd be a good way to build relationships with investors and contractors while making money, so that maybe I could use those connections for flipping/wholesaling and whatever other RE investing that crosses my path. I'm located in New Jersey, and you need a broker license to have a property management company, and I don't have any type of real estate license but I looked it up and I think it's possible to get my RE license and work under a broker and use their license. So I have 2 questions:

1. What do you guys think of starting a property management company? Is there a better way to build up capital, while building relationships with contractors, investors, agents, etc.?

2. Do you know of a way I could start a PM company without waiting 3 years for my broker's license in New Jersey?

Thanks for reading & thanks for the advice

[Vanessa Regalado]

@Maliq Hill I am the owners of a property management company for 13 years.

1) You need to be a licensed salesperson and eventually broker to be a property manager. While you are only a salesperson you need to work under the license of a broker that is open-minded to sponsor you in your business. Most brokers are not open to this idea due to the liability involved.

2) Experience matters- This is a business of experience and really loving what you do. If you are going into this business solely to build relationships you might struggle to find the motivation to keep running the business. The business requires a vast knowledge of landlord-tenant law knowledge, discrimination laws, basic construction, accounting etc 

3) I don't recommend starting this type of business without E&O Insurance. It gets expensive at the beginning anywhere between $3500-$5000 a year based on the answers that you provide to your broker.

As my final comments and recommendations are to go and work for a property management company for a 1-2 years before you open your own. While that you get your real estate license and accumulate the years needed for your broker's license. 

This business is tough and you need a thick skin. There are a lot of great tenants out there but there are also many that will push your buttons and you must be knowledgable on how to handle them without getting yourself in a lawsuit. My recommendation is to work directly under a mentor or real estate investor to build your network and learn the business area that you want to focus. 

Good Luck!