Property Managers - Making Money? Please Chime In

[Danny Day]

Just wondering who all on here owns their own property management company. It seems like a fairly decent job to do on the side.

I've been showing houses around the Houston area, and have spoke with a broker who manages about 35 properties in my area. Seems like its a very leveraged job as far as time goes.

Can anyone chime in with their experience, or how well they are doing with this? I've been thinking about venturing into this side of the business, but would like to hear some feedback first.

Please note: I am talking about managing SFRs only. Not for apartment complexes. The idea of residuals every month seem more appealing to me.

Could you also break down a sample pay structure as well?

Thanks in advance

Danny

[Kassandra T.]

Hi Danny,
Rentals is a slow growth business unless you are able to get connections. I ran a rental business in Alaska. It went from 30 to 167 over a three year period. Most of them came from agents who couldn't sell the home, so we gave referrals to have the brokerage's agents give the rentals to us. I find it difficult to do rentals part-time. There is book keeping, paperwork, and filling that has to be done monthly. All of which takes you away from any showings and the needed prospecting as an agent. Our market has about a 7% vacancy rate. So out of the 100 rentals, 7 were vacant and required constant showings and reviewing of credit applications.
Also, you'll want to get familiar with the laws. A simple situation can get a little crazy when you are not familiar with the regulations and it takes practice to know how to properly handle the different types of tenants.
After reviewing profits, I found that the most profitable rentals were multiplex’s. The owners normally had the right mind set of how to run a rentals. Those that are accidental landlords had a difficult time understanding that they had to make certain repairs. That was a difficult conversation when they could hardly cover the mortgage.
To answer the question- 100 Rentals-Two Employees-Overhead to run on it's own-Profit was around $2,000-$5,000 depending on Lease Option and Fees. I'm sure it would appear to be more profitable if you worked it yourself. However, I like business that run by itself. :)
I’ve heard of a franchise (Real Property Management) I’m curious what other’s had as an opinion about them.
:D