To manage or not

[Ali Sheik]

As a newbie RE investor I was wondering whether or not to manage my own potential properties. Can anyone give me a quick rundown of how to choose whether or not to do so? I see that doing so certainly makes the returns much better. Are management companies worth their weight in gold or is this something many of us should and could do ourselves?  Thanks

[Michael Currie]

In my opinion if the properties are within 1 hour, you should manage them yourself.

If you decide to buy more, you will likely grow tired of doing it, however,  It really is not a huge deal to manage a few units on your own.

You will need some good contacts for repairs, but with the right people in place as long as you are ok paying for service, it is just a matter of the tenant calling you, you call the right repair person, and the problem gets handled, you can be anywhere.

It comes down to proper screening and following / learning about the tenancy rules in your area.

Property managers will all sell you on the set it and forget it, however, I have had some property mangers that take more management then the tenants.

Good property managers that use proper software and have several staff in place to handle issues are usually higher priced, but could be worth it.

Then there are several that do property management on the side when they are not busy as a real estate agent, home inspector, etc...

There are also some maintenance people that claim to be property managers, but sometimes lack the people skills, which are really important as a property manager. 

The bottom line is to build the cost into your evaluation, then decide what you want to do.

I will also say that A and B type properties can be a lot easier to manage than C and D buildings.

I hope this helps,

Michael P Currie