Quote from @Kat McLead:
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I am not happy with my management team in Ohio. They nickel and dime me as an out of state investor, and have my units sitting empty with no work being done on them for weeks. I have to constantly call/text/ email and threaten to leave for things to happen. I am done with this. I have two vacant units right now that I knew nothing about, and just got an estimate after 2 weeks and who knows when work will be done.
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I would like to try self managing, but would appreciate guidance on who to look for or how to have someone show the units and handle evictions. Any help from you more experienced investors would be greatly appreciated. This would save me over $10K a year.
Hi @Kat McLead. We are remote investors (live in AZ) with 5 class C rentals in Birmingham, AL. In 5 years, we’ve had 3 different PM companies, and currently our properties split between 2 companies. We’ve diligently interviewed close to 10 companies during this time. I’m still waiting to find a very good PM company. They tend to operate in the fair to good range most of the time.
Here are some thoughts on self management:
- showing units: Most PM companies don’t accompany prospects when they show a rental. They control access after verifying the tenants meet their app requirements. Put a Wi-Fi or cellular lockbox on the unit (like realtors have) that can be managed remotely. Or even a manual box and require tenants to call/text before and after viewing. If you’re worried about damage you could also add camera security systems to units being shown. You’re handyman can put on a lockbox and periodically check the property after walkthroughs.
- Evictions can be handled by a local attorney. You’ll need to check with them on costs and how/when they are to be engaged. Unless you have a very large portfolio, you’ll most likely pay more than you would through a PM. Hopefully, evictions are the least frequent task you’ll need to handle.
What about handling the routine day to day operations:
- rent collection is easier these days with all the cloud platforms but you will need to research and select a platform and there most likely will be a fee. Certainly less than what you pay a PM company but not free.
- do you know all the local laws on notifications prior to eviction? There are many steps that need to be followed prior to eviction that need to be tracked and followed. Handling late payments, fees and catch up payments is much more likely than an actual eviction.
- repair requests (do you want to be taking calls at 2am)? Do you have a handyman and a list of specialist services plumbers, hvac, electricians, etc to handle the bigger problems? Do your properties have common areas that need regular service or maintenance (trash, landscape, pest, snow, etc)? If so, you’ll need a way to monitor their performance.
- annual and turn-over inspections: your handyman can do these with proper direction and a checklist. It will be another cost for you to include in your planning.
- Not sure if this applies to you, but a few of our properties are rented through Sec8 which requires another level of process and compliance that we didn’t want to have to learn and keep up with.
For what its worth, we also flip houses in the area and so we have a local team in place (contractors, realtors, lawyers, etc). Even with this set-up, and the less than stellar PM services we’ve had so far, we choose to pay and manage a PM company rather than try to remotely manage operation ourselves. Managing it yourself means locating, interviewing and managing multiple “team members”.
So we spend our time, working to improve our relationship and mutual expectations with our PM. When we onboard a property, or when it’s being turned (we do the work on turns) or when it’s being marketed we have weekly calls to monitor progress and problems. Once the property is rented these meetings will taper off and eventually cease. It’s not perfect and we have had to fire / terminate PM companies but for us, it’s still a better option than finding, vetting and managing multiple team members.
