Property management maintenance fees?? where are you at

[David Zheng]

Hi All,

got a question about property management just so we can compare numbers. I'm wondering how much most of you pay for the maintenance portion of your property management company. Do you pay just how much their handyman estimates. Do you get a set list of standard prices? Is there a minimum charge even if they're only on site for 10 minutes?

example 1: simple toilet clog. Handyman spends 2 minutes getting it unclogged. Are you being billed the $50/h rate at a prorated rate or are you handing over $50 as the minimum for such a call

example 2: a garbage disposal needs replacing. Are you getting charged $50/h for something that said they spent 2 hours at or do you get a set price list that says all garbage disposals are $75 labor+ $100 for the unit. (I can replace one in 20 minutes)

Thanks!

[Frank Chin]

Originally posted by @David Zheng:

Thanks for the info guys :)

Yeah I've been doing a lot of the work myself or with a couple calls to handymen. Obviously the ultimate goal is to have it in complete passive mode where I'm not even looking at maintenance items except for once a month.

The thought of having a minimum 35-100 trip per trip charge is scary. I mean....3-7 of those could eat up all your profits. I do student rentals too so they call like once a week for small things.

 Dave, it depends on your cash flow situation. I started with little, in the beginning did more of the nuisance work. Then 10 years into it, my cash flow was up to $30K/year, including covering several thousand a year in small nuisance repairs. If you don't have the cash flow, it looks scary.

I know paying a plumber $100 to change washer sounds silly to some. I know two brothers in my area, who started investing the same time we did, bought 2 triplexes like us, and then sold it about 8 years later, and bagged over $100K appreciation for each, totaling $200K. Appreciation in NYC is pretty good. Reason is they couldn't keep up doing the repairs themselves, and stuff like $100 paying for plumbers sound silly to them. We kept ours for 20 to 25 yrs, and one went from 150K to $500K, the other from $180K to $750K. We made over $800K in appreciation compared to their $200K. what kept us going was we were willing to spend the going rate on the repairs. 

So it's two different approaches, two different results. Bottom line is, repair costs are ridiculous, but so are the property appreciation rates.