The Importance of Property Screening and Management

[Corby Goade]

So many of us, especially newer investors, agonize over the underwriting of a deal, and rightly so. However, often very little thought is given to the screening and management process and that is evidenced here in the majority of the posts. 

I'd go as far to say that screening and management may have MORE to do with the performance and success of an asset than the underwriting. Time is forgiving when we make some errors in underwriting, much more forgiving than a tenant who destroys your property and does not pay rent for six months while you are trying to figure out how to get them out. 

Curious what newbies and some of us older investors think about the topic. 

[Corby Goade]

Quote from @Bjorn Ahlblad:

I don't think it is either or. In order to be successful you need to do the best job you can at buying right and screening diligently. You can be torpedoed by a 500k property that only produces 2-3k rent, a HUD lawsuit, a semi screened tenant who does not pay rent and the property is in LA, NY or San Francisco, or a hundred other cities and communities that think landlords are money sucking pigs!

Yes, you can use a PM which in most cases will help a lot, but if you did not underwrite properly you may think you can't afford that.

Hey but if REI was easy everybody would be doing it!

All good points! 

For clarification, I wasn't suggesting that an owner HAS to hire a PM company in order to manage a property professionally- its possible to do it on your own, but not many people do.