Out of State Investing

[Nicole Murphy]

Out of state investors, 

do you have property management companies running your properties or do you handle things yourself? any other recommendations for management? 

[Joel Allen]

@Nicole Murphy

I use a ‘hybrid’ approach to self-manage a small portfolio of out-of-state properties, but all are single-family homes that my family and I lived in for a few years and then turned into a rental when the military sent us to a new duty station. Since we have previously lived in the homes for 2+ years each, I’m very familiar with the area/neighborhood and we have built a trusted group of contractors (plumbers, HVAC, electricians, etc) at each location that I can call whenever a maintenance issue needs to be addressed.

The 'hybrid' approach that we use for managing those properties is….

We hire a leasing agent to manage all the items up until the point the tenant moves in (photographing the home, listing the home for rent on the MLS, coordinating showings, accepting applications, screening tenants, accepting security deposit, etc). On the tenant's move-in date, the leasing agent meets the tenant at the property, provides them with the keys and a welcome package that we provide, reviews the lease with the tenant, and conducts a walk-through inspection with the tenant.

As soon as that walk-through inspection is complete, the leasing agent officially hands over management to us and we are self-managing for the remainder of the tenant's occupancy. 

This 'hybrid' approach allows us to have the necessary boots on the ground during initial tenant on-boarding & exit. We pay the leasing agent a one-time leasing fee once the tenant is placed, and it eliminates the ~10% monthly property management fee.

If I was ever to try to scale to a much larger portfolio, I would use a PM. But that’s not my goal, and I enjoy managing the properties.