Starting as a property manager? Good or bad?

Question

Oh BP how I've missed you... So im back, and it must have been longer than I thought because the site looks totally different. (looks great Josh!)

So my title question kind of says it all. For people who are very interested in real estte especially in the investment side is property management a good place to start out in? Being relatively young still and knowing real estate is the one thing I do want to do (tried education, tried sales, tried fitness) would it be smart to get into property management?

I know people say you get burned out of it but at the very least I would learn quite a bit about how to run my own rental business without risking any of my own investments. I know the money isn't great but it would be stable and beat the sales grind. Is there a better way to go for someone who is interested in real estate and is looking for a job but is by no means pressured to get one? If property management is the way to go would you contact the biggest firms or try the local reia to hopefully find local PM companies?

Your thoughts?

Joel Owens · Answer

Matt,

I am an investor myself and a commercial broker who owns my company.

I DO NOT do property management.I can tell you first hand you will truly underestimate the amount of work involved to do property management CORRECTLY.

Many brokers/agents see the small fee as an income stream but underestimate the cost of time spent versus the money earned.This is why I believe people that do property management have to enjoy and have that personality.

The older vintage age of the property the more calls you will have and issues that come up.Also if it is a C to D area the issues will increase.

Why don't you go work for a commercial brokerage?? The big ones pay sometimes 30k to 50k a year base plus a bonus on what you close.Develop your investor network and go out on your own.

For property management in most states you cannot manage other people's properties without a brokers license or being under a brokerage as an agent.You can manage your own properties or ones you have an interest in the corp etc generally without a license.

Rob Gillespie · Answer

Matt,

managing real estate is just buying yourself a job. You will not likely achieve anything worthwhile plus you will HATE the biz after dealing with bad tenants and pissy landlords all day!

Just flip some freaking contracts. It is fast, easy, and you will have coin in your pocket within a few weeks without using any cash or credit.

You have a ton of choices, but I would choose one that takes you closer to your end goal. Good luck! :mrgreen:

Phillip Dwyer · Answer

Many of your options aren't mutually exclusive.  Find a good company and good mentors for property management and sales.  You can do both well with the right training.

Adrian G. · Answer

Well said Rich.

Rich Weese · Answer

Matt- I don't normally take both sides of the argument-but this one is different. Here are both sides.

PM is NOT rocket science. I taught two different teen age daughters to handle my mgmt 15-20 years ago. They did great. Of course, both were intelligent, gorgeous and had great self esteem. I also took a young couple in S. TX and taught them from scratch. They handle my 40 properties and he is a school teacher and she is a stay at home mom with 3 kids under 5. It is a good team. Both are bi-linqual. I've also seen several folks start from scratch and they currently have 100's of units under mgmt.

Now the negative. This is a terrible economy. I know that most service industries are taking a hit. When people constrict their spending over concerns in finances, they choose to do a lot of these things for themselves. Landscaping, pool maint and do their own PROPERTY MGMT.
 
So, there you have my arguments for both sides. Good luck. Rich

Adrian G. · Answer

Matt,
To be honest, I think you should give it a try. Im one of those people who jumped in to things....no construction experience, no rehab experience...or anything AND out of know where I did my first rehab, which to be honest was kinda scrappy but the market saved my ass. Even though I have a few apartment buildings now, in the beginning I was doing my own property management and I made a ton of mistakes which could have been prevented and costed me THOUSANDS not hundreds but thousands of dollars. So try it for 1 month...5 months...1 year either or, get the experience. Just my .02cents.

Joe Delia · Answer

Licensed Professional Assistant.  Essentially you do a lot of the bitch work for an agent, but, in the process you'll learn a lot.  Yes, it'll be steady income, in Chicago, maybe $20/hr.  Yes, an established PM company will have those processes in place.  I was thinking you were going on your own for whatever reason.

Good Luck!

Matt DuSold · Answer

Wow I'm surprised at how negative the veiws are on property management. I'm glad I asked!

Joel, thanks for the tip! I will definitely look into it. I would think they would look highly of my sales experience so that could be a fit. I did a quick search an took a look at their websites didn't see much in the way of "careers" or "employment", best method just to walk in and see what opportunities may be available?

Appreciate the help everyone!

Kathy V. · Answer

Hi Matt!

IMO, if you love real estate, I would go a different route. Being a PM is alot of the same activities, done over and over again. This could lead to burnout.

Can you intern for someone? Can you work on the weekends? There are many activities you can do in RE without having a license.

All the education and reading in the world means nothing until you actually start using it!! Good luck in whatever you decide!!

Matt DuSold · Answer

@ Joe, What do you mean by an LPA? Would that provide me steady income and benefits? You say PM sucks unless you have processes put in place. If you are working for an established company wouldn't those be put in place? Or is the kind of dependent on the tenant?

@ Chris, I agree BP is outstanding and full of information. But most people on here will agree that you need some sort of steady income or a lot of cash when starting. I have a good amount of cash for my age but no where near enough to not work at all.

I guess I asked this question as, If you had to get a job, and love real estate, is PM the best way to go or another avenue?

Thanks for your answers fellas!

Starting as a property manager? Good or bad?

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