When does it make sense to hire in-house management?

[Alex Rodeberg]

My father and uncle own 124 residential units with cashflow around $520,000/yr. This isn't including a management since they currently do it themselves. They are now looking to wind-down and focus on commercial properties while letting management take care of their units. They want to know if they should start hiring in-house employees or simply let a third-party management company do it.

I've been talking to management companies and getting quotes of 8% of gross rents for the entire portfolio. I've also done some research on here and throughout reddit where people hate management companies so I looked into seeing what an in-house management team would cost. 

1 FT property manager = $45,000 

1 FT Handyman = $40,000

PT bookkeeper = $20,000

Leasing an office = $15,000

Paying employees insurance = ?

Paying for vehicles or gas = ?

Software = ?

Total might be around $140k-$150k a year for in-house management, this is my estimate, I could be way off. I'm sure this also comes with a lot of it's own hassles that can't really be accounted for.

The management companies are charging 8% of gross rents collected. Gross rents are $1.12 million/year, at 8% that would be around $90k a year. The big issue I see online is that management companies might overcharge for repairs or add in fees here and there. \

Would it still be worth hiring in-house? If not, when does in-house become worth it?