Dear Property Management Companies....

[Mike McKinzie]

and Property Managers in general,

Just about no one on Bigger Pockets is as big a defender of Property Managers as I am.  While some folks are great DYI people and can manage their own properties well, I am a firm believer that a Great Property Manager will actually INCREASE an investors return on a piece of property.  Not only did I run my own property management company back in the 1980s, I have just recently gone back to work, for a Property Manager here in Orange County, CA.  We manage about 4,500 units and I manage the Accounting Department and have five people under me.

But I have started to notice a trend in Property Management that is weakening my defense of you. I am seeing more and more ways that you guys are GOUGING the investor. Back when I ran my PM company, I got my 10% fee and THAT WAS IT. I did NOT charge for renewing a lease. I did NOT charge for finding a new tenant. I did NOT charge extra for a repair. I did not have my own in house repair company. And the company I am now working for also does NOT charge to get a new tenant, does NOT charge to renew a lease, does NOT charge a 'commission' on a repair bill. As a matter of fact, I have 11 SFR rentals in CA and NONE of my California PMs charge for a new tenant or charge to renew a lease or charge extra on top of a repair bill. And one of them, who manage several rentals, charges me 6% of the months rent and NOTHING else, EVER.

Therefore, having run my own company, having current PMs manage for me and currently working for a PM in CA, I know what it cost to run a PM company and gouging us is very unprofessional.  And please don't use the cliche "you get what you pay for" as I have found that to NOT be true very much in life.  I will absolutely PAY more for good quality, but it better be as good as the comparison between a Rolls Royce and a Yugo.

I will continue to DEFEND Property Managers as I like to invest in a variety of places.  But if this trend continues where PM's try to find "new and exciting ways" to gouge the investor, I may be forced to semi-self manage my properties.  I have the knowledge and skill, I just thought my time was more valuable, but when a $1,000 a month rental COSTS me $3,000 every turnover, that might convince me my time is worth semi-self managing.

This may sound a bit like a RANT, as well it should.  I don't like overpaying for anything, from an ice cream cone to a new rental.  As is always said on Bigger Pockets, you make your money when you BUY, so BUY right.  I am 'buying' Property Management so I want to buy right.

As a final question to BP, have any other investors noticed this same trend in Property Management, that they keep finding ways to charge us?  Or is this just me?