Property Management Question - Please Advise

[Raylor G.]

Would you hire a Property Management company that charge a fee for vacant units. Is this common practice or should this be negotiated?

[Dawn Brenengen]

@Barbara G. Actually, you first said - "I thought my first option would be to be if any of my relatives would do the Property managment for me for a PM fee."

PM by definition is a real estate activity, and in most states you need a license to do it.  Maybe you do have plenty of experience, and can handle all of your properties yourself.  I think long distance management can totally be done with a few key people in place locally. However, hiring a real estate agent for tenant placement, like Sue previously mentioned, is a bad idea.  They don't know what they are looking for. Screening tenants is a skill that gets honed over time.  I'm assuming the RE agent has no experience in PM when I say this.  Obviously, if the agent also happens to be an expert tenant placer, then by all means, use that resource. Hiring a family member is even worse because they would be breaking the law in many states.

Remember, to get your money regularly, a lot of things have to fall into place.  You home needs to be maintained, repairs need to be handled quickly, good tenants must be chosen, and rent must be collected.  If any of those things are mishandled, the money starts going out the door quickly.  An ounce of prevention is worth a pound of cure.

Also, rules and regulations vary GREATLY by state, so what flys in NY may be totally against the law in NC.  You have to be very familiar with each state's laws in which you invest. I've been managing properties in NC for more than 12 years, and I still occasionally learn something new about NC laws, and it doesn't help that the laws also get revised regularly. You even have to know the ins and outs of the particular City, not just the state.  In Raleigh, you can't have more than four unrelated people living in a home together.  You also must register your property as a rental with the City.  Five minutes over in Cary, that's not a thing.

Long story short, if you don't find any value in paying for PM, then of course, don't hire one. What concerns me is when people misinform other people or give just plain bad advice, and now those newbie folks run off and get themselves in trouble. Hiring someone for a job in which they have zero experience is simply not a good idea.