Should I hire a Property Manager for my first house hack ?

Question

Hello BP community, I've recently been having A internal debate with myself on how to proceed with the question I have stated above. I plan on buying my first residential multi-family property after I graduate college and get my finances in order, but the question is should I work with a PM if I am house hacking? I will be in the unit next to my tenants and I also know how to fix a-lot of issues, but not all issues, I know Property managers do way more than just fix issues, would love to hear BP's thoughts on this !

Matthew Kwan · Answer

HI Colby,

The one good thing managing your own property especially your 1st property, you will have hands on experience and it allows to have a sense of what a landlord's obligation. On the other hand, he good thing of hiring a property manager, it allows you to get less involved with the conflicts/drama between the landlord and tenants. However, you will still need to be hands on and have a close communication with you property manager.

As for house hacking, the good thing about it is that after one year, renting out your current home can add extra income which can help you increase your borrowing power. It will depend on how much you need for your next primary residence if what you currently have in savings enough for down payment and closing cost then you should be good. Once you buy your next primary home and you plan to live there and move out after a year to buy your next property then you need to make sure your potential lease will cover your future Mortgage payment with Tax and insurance. Then continue to do the same with your future investment properties.

@Carlos Valencia @Albert Bui

Tanner Pile · Answer

@Colby Zeller

Self manage first so you can get the experience and understand what makes a good PM for when you're ready to move out and have it managed. It sounds scary at first but once you have it running you'll be up for the challenge on any issues that come up.

Mark Ainley · Answer

@Colby Zeller I am a PM and I still think you should manage yourself so long as you do not travel too much.  One thing is be sure you have a network to help you or you have a go to person that can help you as needed. Might be another investor or even a PM.  Be sure your resources are there.

Luis Saenz · Answer

@Colby Zeller

First, congrats on the house hack my guy! That is awesome. My wife and I house hacked our first duplex and I would say a property manager is not necessary. Especially if you are going to be living very close by. I think managing your first property is great experience so long as your have the time/resources to do it. Definitely listen to @Charles Carillo advice. Once you get a place where you need your time to focus more on real estate or other things. Then pull in a property manager, and since you will already have some experience, you will be more adept in your property management search. That is my opinion anyways. But if the numbers make sense and you'd rather not deal with the property management side, then go ahead and hire a PM! Either way will work, just get in the game! Good luck man, if you there anything I can do to help, don't hesitate to reach out!

Ryan Thomson · Answer

@Colby ZellerIt depends on your goals! Here are some good questions to consider:

Are you trying to save time so you can focus on your job that earns you more income/hour spent?

Do you want more cashflow and it's worth your time to manage it yourself?

Are you comfortable dealing with the extra headache of managing yourself?

Doug Spence · Answer

@Colby Zeller I would definitely self-manage! Its a great learning opportunity, and you'll save money. You don't necessarily have to do all the repairs/maintenance though - I would only do what you feel comfortable with. Also the tenant may be more comfortable with a professional coming into their home to repair things instead of you, but most wouldn't mind.

You'll also save a lot of money by screening/placing the tenant yourself instead of hiring a PM to do it. Zillow is a great free tool to do the listing and the background/credit checks. I've done it myself many times and recommend it.

Good luck and keep us updated with how its going!

Charles Carillo · Answer

@Colby Zeller

I would not hire a PM for a house hack unless you travel for extended periods of time. A thorough tenant background check will make your life easier. Have a list of requirements you want your tenants to meet, and ensure they meet them. Figure out how you want to accept payment from them on a monthly basis. Next, make contact with a local handyman, possibly one good one that will come over once and a while to fix issues that might arise. Finding good tenants, and having assistance with repairs will alleviate the majority of your headaches.

Colby Zeller · Answer

thanks for the tips ! this was really helpful

Should I hire a Property Manager for my first house hack ?

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