Whole bunch of Easy Property Management Company Questions

[David Zheng]

Hey guys,

so I've been diving deeper and deeper into property management and had a couple questions. some are opinions and some are factual

1. do you need a license to start a property management company that hires people but ONLY manages properties in your own LLC or under your name?

2. Pros and Cons of starting a property management company (hiring your own manager, secretary, handyman, contractors, etc.) or hiring the work out to a third party? I understand that starting your own means starting from scratch and still having to work/being a boss for a while, but the end goal is that your main manager takes after your spitting image and can do everything for you, so you can boss from the beach.

Obviously starting your own property management company will require you to have like 100+ properties or something high. For me the financials make sense...100 properties at 2000/month rents. 10% is $20,000 a month for a 3rd party. Hire a couple people for 3-5k/month would be cheaper.

am I missing something?

Thanks!

[Joel Wilmoth]

There are going to be more expenses than just hiring a couple people.(software, phones, office etc).  It is also probable that if your rents are 2k per month that you can find a manager at a fixed fee and lower than 10%.  

If you own all the properties and anyone but you will be leasing them, check your local state law but the leasing agent and your company will likely need a real estate license.

Overall, for managing your own portfolio at this size it seems to me it would be easier, simpler and possibly less expensive to let a 3rd party manager assume the headaches