Property Management - Self-Manage

[Justin Wallman]

Hoping those of you who self-manage can lay out your current business structure as it pertains to operations. How many people do you employee, how many PM’s do you have, etc…. I think we may experiencing some growing pains and I’m uncertain about how many people we need to hire. What are the ratios to PM’s to tenants/homes?

Currently, my wife is the only person who manages all 160 units/tenants. We employ 2 maintenance guys that are basically dispatched every day. We find it difficult for them to handle any “bigger” projects as it will really bog us down. This also applies to her to keeping up with tenant turnover and the crazy amount of steps that is required on a day-to-day basis.

I thought having something in the lease that mentions a certain dollar before we will send the guys out. Just a thought…

Thanks!

[Nathan Gesner]

If you are managing for yourself and nobody else, the numbers can be a little higher because you don't have to communicate with owners, send owner payments and statements, etc. However, I think you're still hitting your limit.

Every rental should be inspected at least once a year. Some properties require drive-by inspections every month. You have to inspect before occupancy and after move-out. Signing leases, chasing unpaid rent, dealing with unauthorized occupants and animals, answering questions about early termination, etc.

How does your wife go on vacation or take a few sick days? I would think you need at least one full-time administrative assistance to help cover the office and phone. I suspect she barely keeps up on the work and she may be dropping the ball in some areas, like inspections.

I guess it depends on your goals. If your goal is to run yourself (or your wife, actually) ragged to maximize income, then keep going! If you care about your physical and mental health, want to travel or enjoy life without so much stress, then you should pass these properties off to a Property Manager and start enjoying that money while you still can.

Brandon Turner is a pretty driven guy. One day he crunched the numbers and realized his return on investment wasn't much better than the guys investing in syndications. The difference? He was running himself ragged trying to manage his rentals while the syndication investors were collecting money without ever having to worry about tenants or toilets. He sold most of his properties and moved into syndications where everything is handled by others. I suggest you have a serious conversation about what you are trying to accomplish because right now it looks like you've sacrificed personal freedom, health, and enjoyment at the altar of the almighty dollar.