Should I self-manage my Toledo Rentals???

[Andrew Fidler]

Should I self-manage my rental properties?

I am a licensed real estate broker here in Toledo, OH who specializes in property management, what do you expect me to say, right?

Actually I turn away more owners for management than I take on, that is a post unto itself but there truly are remote OOS owners who do quite well managing their properties from afar. There are also local Toledo landlords who absolutely suck at the business and should be outsourcing (before they fail completely and end up being the next sales listed online).

Property management is not car repair where you are simply comparing your own labor / material costs to your local Tireman quote...with a car you can throw parts at the problem until it's fixed and more importantly the car never knows if you are cluelessly streaming youtube videos to figure out how to replace a starter.

Property management is more like caring for a herd of horses...they know darn well if the farm hand trying to saddle them knows what they're doing and they smell fear from a mile away. Personally there is nothing I enjoy more than taking over a property from poor management and letting the tenants know there's a new sheriff in town...they either tow the line or pack their bags. 

So, can you property manage your own property? Absolutely! If you are smart then you should be planning to manage MANY properties. Ten was my tipping point where the income from the properties paid for most anything that came up. So I recommend you plan on that goal in your decision.

To manage your own properties you need to build your own mini-property management company...who is your electrician, plumber, roofer, who does your evictions, attorney to advise on those split-second decisions, how are you collecting rent, preparing leases, showing units to rent, the list goes on!

How do you manage? When I got started a decade ago with my first rental I jumped in with both feet and figured out what I was doing by LEARNING continuously, a skill that I feel is the most important facet of success in real estate...you have to know city code, pending and present legislation and tenant law, what tenants desire and how to cut through the BS that will inevitably be throw your way, also build your internal compass of green light / red light which tells you when to get a purchase agreement written up or turn down that tenant application who simply has to move within the next 48 hours. Join your local REIA, participate! I found my best role in my group was to board membership where I could contribute and be on the front line of new deals and contractors! Read BP and head up to Amazon and bring down book after book.

So, do you self-manage your properties??? If you are interested in shouldering the burden of learning, trying, and the fall-and-get-back-up approach to the business then by all means I truly hope to shake your hand at the next meeting of the Toledo Property Investor's Network. www.toledopin.com

If you are lucky then this will open an entire career for you. I remember when I first started I was focused on what investment property I wanted and focused my time itemizing repair quotes and projecting returns. After the 10-property tipping point I spent my time making sure that the rent was paid every month and assembling the team to ensure my investments were properly maintained. The next tipping point was at 30 properties, I couldn't keep a full-time job and be the contact person for the litany of questions that needed to be resolved through out the day. Once I doubled that number of rentals I'd quit my day job and built a solid property management company...all it lacked was the licensing to be able to go public.

So why hire a property manager? A good property manager is going to offer services to acquire and market skills to sell investments, a good portfolio is regularly changing as values increase or deals arise. A great property manager will be focused on operating safe, profitable rentals...that's not to say they will be loved, I feel that a property manager has the unenviable job of holding the owner accountable to maintain their property while enforcing the terms of the lease agreement with the tenant. As a business, a property manager should be setup to efficiently rehab, lease, rent, renew, maintain properties...this truly is the hardest part of the business in my opinion. 

Finally, the relationship you keep with your property manager will define your ultimate success...my clients all know that if they have a catastrophic loss, a lawsuit, or most recently a lead paint exposure report from the local health department we will work together to resolve the issue professionally and ethically. I think this is the most important aspect of a great property manager, you can make relationships at your local REIA or BP and build your skills in this area, but I have heard the relief on the other side of the phone when I can respond "been there, done that, here's how I think this will go and how we will proceed" to resolve those major events that inevitably will happen in your real estate career given enough time.

Final thought - I am unaware of successful international investors self-managing...does anyone know how folks could profitably manage given the distance and large time zone changes?