Property Manager AND Repair/Maintenance Budget?

[Ken Alce]

Hi all. I'm planning on house hacking and I'm excited! I've been doing daily reps with the rental property calculator but I'm confused. Why am I setting aside money for repairs and maintenance (conservatively set at 7%) AS WELL AS spending 10-15% of my monthly income on a property manager? Other than collecting rent, isn't the property manager's job to handle repairs and maintenance? Of course, I set aside the CapEx % for the big stuff but I thought PMs handle the small stuff.

My concern is that I'm walking away from potential deals because the cash flow is coming out low/negative when maybe that say 180 a month could make the difference between a non-starter and a potential goldmine!

[Benjamin Seibert]

@Ken Alce unfortunately, the % that you set aside to pay the property manager doesn't cover the actual repairs, those are extra. The % you pay the property manager is for them handling rents, renting out the property to tenants, evictions, etc... (some of those may be extra depending on your PM). In my area I calculate around $300-500 a year per unit for repairs, 10% for PM services and $1200/year for capex on the property per year. I'm pretty familiar with my market and these tend to be what the numbers are for my desired streets. Does that explanation make sense? Let me know if not