Should I have a property managment and handyman business together

Question

I work for a local handyman doing his bookkeeping etc. we are now working with a client that is turning their home into an air bnb. his company is making ground changes, building camping areas, making beautiful landscape, etc. the client has asked me to be the property manager as they live far. I got another client doing the same thing that I connected with, needs some maintenance work but want's me to be the property manager as well. My boss said we should run the handyman and property manager business together so i can make money but when in reality it will only make him money. should I run the property managment under my business which is wine country venues and events as i am an event planner. Any input would be great because there is another possible one as well.

thank you

Nathan Gesner · Answer

It sounds like an easy opportunity, but it can actually ruin you. I know a lot of people that dabble in property management. Everything is easy . . . until it's not. They get a bad tenant that stops paying rent, trashes the property, sneaks in five friends and a few dogs, gets noise complaints from the City, or whatever. If you don't know what you're doing, you can cause some serious losses to your client and open yourself up for some serious liability.

To quote the infamous Mr. Miyagi: "Walk left side road, safe. Walk right side, safe. Walk middle of road, sooner or later, squish like grape."

Jonathan Klemm · Answer

@Lynette Corona - Sounds like you are on to something but I would definitely look into separating the two businesses.  You should still keep doing the bookkeeping for the handyman but start a separate business doing property management.  You may need some special licenses as @John Warren mentioned but you actually probably don't need a license to be an AirBnB manager /event coordinator.

Lean into the new opportunity and I think it will pay off.

JD Martin · Answer

What it sounds like to me is that the handyman wants a cut because you are getting these potential clients through the interactions of the business he is doing with them on the ground. When he says "we" should run this business too, I don't particularly understand where you come into the picture - you said you do his books. That's not the same thing as being a PM.

Lynette Corona · Answer

great thanks so much for all the input. much appreciated

Drew Sygit · Answer

If one of your businesses is sued, do you want both of them liable?

Lynette Corona · Answer

Hello everyone good morning. Thank you. I appreciate the feedback. I took my property managers exam on the Sonoma county website and passed, it's for 1 air bnb maybe 2 but for now it will only be the 1. I still have my license for planning, should i use that one or setup a completely separate license for vacation rental property manager. I also just started on obtaining my real estate license as well. It's been a slow online start but I have a year :)

I still do his bookkeeping, pretty much family but I need to make money as well to invest. He also wants us to invest in abandoned properties to purchase and fix up as there are a lot out here so that's another project down the road not sure how that would work out for us making money together but for now I just want to work on the air bnb property manager.

Melissa Wesling · Answer

I agree with the suggestions to find the legal way to manage other's properties (ie real estate license if necessary).  You may also want to consult a tax attorney about opening separate LLC's for your event planning business and your property management business if you decide to run it. It may be beneficial to have them separate.  Decide if the handyman will be your partner in this. Property managers charge a percentage, so research what you would have to charge to be worth your time.

Scott M. · Answer

Managing properties does require a license in most states. Not necessarily for the manager but for the business.  Meaning, you can get a real estate broker to be the designated agent/broker for the business but you do in fact need someone with this (more than likely, just with your states laws)

So, first things first, decide if you are going to manage properties for other people legally or not.  If so, you now have a partner on board who carries risk and will need to be compensated as well.

The word @Nathan G. used was perfect "dabble".  If you are going to dabble at this things will be great until they are not and then you risk losing the handyman work as well.  If you are going to do it, you need to do it right, set up a proper, legal company and that will involve dividing up money between all parties.

John Warren · Answer

@Lynette Corona property management is 70% accounting and 30% on the ground work (maintenance, leasing, etc). If your boss wants to manage these, have your boss investigate your state's licensing requirements. Here in Illinois you have to be a real estate broker or managing broker to manage other people's real estate. I suspect that managing for these clients is something you all are not ready for.

Should I have a property managment and handyman business together

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