For people who self-manage

[Alex Hugo]

For most investors, I talk to that self-manage the reasons they give is that it is not economically viable when they have less than 40 units.  This goes for single family and small multi-family.  This is not the case for people who buy turnkey.  My question is two parts.  First, if you self-manage, why do you self-manage versus going with a property management company?  Is it really only about the numbers or are there other factors that go into it?   Second, What are the biggest problems you face with self-managing and at what point will those become big enough issues to hire a property management company?

[Patrick M.]

I self manage for a host of reasons and the least has to do with cash. I got in this with the guidance of others who managed their various multi-families, so it really was never an issue I considered. Having taken that guidance and gotten a hold of 2 very run down multi-families in A+ neighborhoods I have dealt with a whole host of issues from burst pipes- to new roof -to clearing out 5 no good tenants- et. all in the span of less than 2 years. I have just shown and rented 3 renovated apartments for a significant increase. We have designed, contracted out, worked on and advertised and rented out these spaces- and it is awesome listening to peoples' compliments. It is also awesome to draw on a more stable renter.

I do it because I love it! I love every aspect of it. I love screening my tenants, I love knowing my buildings inside and out, I love squeezing an extra few dollars here and beautifying there... and I LOVE GETTING MY RENT CHECKS.

We are all different here- I have listened to great investors on here say that they are scared to tell tenants that they are the landlord- not me, not for a second.

Now- believe me this, when I started I had a separate line for my tenants (still do), when that phone rang my stomach would drop- how I did not have a stroke I don't know. I kid you not- each time. Then I had to do battle with my first tenant who was trying to pull a fast one. I went in- held firm and made my demands known in a respectful manner.1 down... then commenced the cleansing of the bad peeps... all by myself- now I have a skin like an alligator and my remaining tenants know I am the real deal. And I am all the better for it and I LOVE that I did it.

I believe it boils down to your view of your property. I do not view it solely as an abstract, investment vehicle. While I am well aware of my financials, it does not have to provide me a predetermined, abstract return and I am sure as hell not going to leverage it to buy six more properties and then leverage those properties and then...

I just love managing. I can't imagine that there comes a time when I will not even think twice before giving some shmo 10% of the cream of my hard built and earned profit.

My advise if you self manage is to join a network of landlords in your area. Then you can get a better scoop on contractors etc. If I did not have my friend to run things thru with I would have been toast in the first year- not the internet, you need a face to face unfiltered friend. A phrase that got me through a lot was "This too shall pass."

It is an awesome experience/job/life!