All Forum Posts by: Kevin Epp

I don't know anyone as a consultant personally, but an outstanding resource is PM Build with Marc Cunningham.

If you have the money for a consultant, then you can probably spring for their events/seminars. They work with business owners and they walk you through how to set up and optimize the PM company, etc. I have not personally used them but know others who have and have enjoyed their services. You can also do their 1 on 1 if you want that too.

To start: I am a property manager, never managed 30x doors remotely. Goes with the job, I live and work in the territory I work in.

The following things I believe to be true: you could definitely do this; you will definitely take on more risk.

Food for thought: building a strong network of folks you trust would be a must. For sure. By virtue of asking this here, it's clear you're weighing the benefits (feasibility) of doing it yourself or hiring someone. Keep in mind...though you might have a strong network of trust between agents and vendors, that does not equate to a signed property management agreement where the PM is contractually obligated to take care of your portfolio. Read: the trust of the agents and contractors you work with will go so far as their good will does. If you sign a contract with compensation for these agents and vendors to assist your portfolio....well, then, you've essentially done the same thing as a PM but with more contracts and relationships to manage.

Specifically answering your questions:

1. Has anyone here successfully managed a portfolio of this size remotely? Never managed remotely.

2. What advice do you have for establishing a reliable local network when you're not physically in the area? What other resources such as VA's could I consider? Referrals from local PMs would be a good start. If you don't want to "get sold" by a PM when you're really looking for vendors, then talk to brokers on the buy/sell side instead. I see you're a broker too, so you have your cleaners, other agents to show properties etc. 

Virtual Assistants: VPM Solutions is a company that specifically trains and sources VAs for property management. Would be a good start.

3. At what point would you consider relocating to be a necessary or advantageous move?(number of doors) Don't know about relocating, however, the adage is 50x doors per PM. That's with them running everything. Maintenance coordination, leasing, etc. With that said, if you search the forums here you will see folks managing 100, 200+ doors with a small team to assist (showing agents, maintenance, etc.) Doesn't answer your specific question above but worth adding.

4. Are there specific tools or systems that you recommend for remote management that could help streamline operations? There are tons of software to choose from. I'm sure folks will respond here with the list of them. If you're managing remotely, then finding a software that enables remote showings (if you don't have someone on the ground to show it for you) and you can advertise/screen/place folks from it. All the big software companies (RentVine, Buildium, AppFolio, on and on...) have capabilities like this. I use ShowMojo for my remote showings and screenings and it gets the job done.

Sidenote: I'm in Tacoma if you want to shoot the breeze and talk about this more. Don't know where you're at in WA.

Wouldn't get involved in tenant personal matters unless they are violating something in the lease or endangering others or themselves. Doesn't sound like that's the case here.

One note though, if you already have it for the other tenants, we have crime free addendums and quiet hours for neighborhoods. If that's what you're getting at, that there might be drama between them that effects the property writ-large, then those should cover it depending on the verbiage of them. You can hold the tenants responsible in that way.

But to echo what the folks here are saying, sitting down and having a conversation with either party regarding their break-up and the present situation would be a no-go for me.

@Andres Ruiz

Deposits: Out here in WA we need to maintain security deposits in their own trust account, separate from other funds. Sounds like NC's law is the same/similiar. Just like Nathan Gesner said above, it's not anything special. One thing of note, I recommend you dig into your local laws regarding trust accounts for security deposits. These laws will spell out what you can use as a trust account for security deposits (interest bearing, who gets the interest etc.)

Software: frequent question here on the forums. Drew and Travis have put down good recommendations above. For just one door, don't know if it's needed. Depends on how much you value your time.

Quote from @Drew Sygit:

Newbies don't care about any of this.

Even if they say they do, their actions speak louder than their words!

Many of them mistakenly believe all PMCs are the same, so they usually just go with the cheapest PMC.

So, price is all that's important to them.

 @Drew Sygit Sure, I'll bite. hah!

To onboard? I've seen newbie owners step over dollars to pick up pennies. For sure.

To maintain their business after a year or two? Referrals? To be considered a "good property manager" like the topic says? Not so.

@Jason Hanson

Sometimes you hit the 'time' button to save yourself money. Sometimes you hit the 'money' button to save yourself time. At 7 doors it's not necessary, but of course software can save you time, especially if you grow.

If you plan to scale beyond your current size, I would echo other folks above that you should look into one of these more robust software solutions sooner than later (re: Buildium, AppFolio, RentVine, etc.) Don't get too caught up in it however, as a lot of them have APIs to transfer properties over if you want to jump later on.

Food for thought: some of these platforms have a minimum for units. I was able to circumvent this by saying, "but I plan to scale wayyy beyond this very soon." "Very soon" ended up being a relative term for me lol but the takeaway is don't be dissuaded by a minimum door count for some of these platforms.

Highly recommend you shop around. There's a lot of cross-pollination in the industry and you just have to find what you dig the most.

Quote from @Drew Sygit:

@Account Closed and @Noah Bacon

The challenge for any PMC is trying to keep ALL their owners happy - despite owners having various approaches to maintenance ranging from:

1) Slumlord

2) Over-improving like they will live there

Our best approach to all this is to, "Maintain to the Neighborhood". 

We also try to note everything wrong that is readily visible and then categorize each issue as:

1) Health & Safety

2) Property Preservation

3) Marketing Negative Impact

4) Miscellaneous

This can help owners make better decisions on which repairs to prioritize, especially if they have a limited budget.

I like Drew's bottom 4 points here. That's good stuff.

Big lesson learned here: not all PMs are fire and forget. Next one you'll probably be a little more hands-on with.

Things to consider:
Does your PM upcharge on maintenance? If they do, I would coordinate and pay for the maintenance yourself. (Doesn't sound like they're worth the upcharge fees if they can't notify you of long-term maintenance.) This is of course barring your PM agreement.

If they don't upcharge on maintenance, and the rents are still at the level you want, I would get that deferred maintenance knocked out then fire the PM. In that order. Reason being, if you're shopping for a new PM, a nicer property with less of a hassle on maintenance will open that pool up. A lot of PMs are great, but they also won't take on neglected properties. Will just help you out as you shop around.

Final note: if you liked working with this PM (other than the lack of communication on maintenance), maybe ask them for quarterly pics/etc of different parts of the property in order to find a solution to this issue for the future. If that's a bridge too far, seems like it might be time to move on.

@Demetri Wilright

Short Answer: find plans --> ask a builder how much it would cost to build plans --> add 15% to this estimate --> ask a bank what their interest rates are and figure out what your debt service will look like --> hit up local property managers and ask them what they think they could rent it for.

Long Answer:

Little late to reply here. I'm right down the road in Tacoma. Recently I built a home on raw land and held onto it for investment purposes in Pierce County, so I can walk you through that entire process. Additionally, I have a bud who is currently building a duplex on raw land in Tacoma with the intent of investment purposes as well. Hit me up if you'd like to meet up and talk about the details - I built a huge PDF of all of the lessons-learned from the experience too. (It was my first time building, I did not use a consultant, everything worked out fine.)

Some things I learned during the process:

1. Your builder is the most important part of the project (pre-renting, of course).

2. Youtube University and Podcasts can teach you 90% of what you're looking for. I consumed all the various podcasts and youtube videos using various key words of my project. Each phase of the build, I would watch/listen to a few hours of what to expect. It allowed me to be educated when I was talking to the lender and builder, it also saved me in some things I didn't know.

3. A consultant would help, not necessary. Just be super humble in asking questions. Sparing your ego and asking the "dumb" questions could save you thousands of dollars or the project entirely.

4. Permitting wasn't as bad as all the forums say. Go to the permitting office and introduce yourself. The government still works in the 1950s (maybe 70s). Say hello to them, remember their names, ask all your various dumb questions to them. Paid dividends.

5. Hit up a few local property management offices about what their going-rates are for rentals. Local laws, etc. I also asked these folks, "if I were to build the perfect rental, what would it look like?" Helped me with designs and overall a sanity check.

6. It's a process, not rocket science. You can do it, just scary to put a lot on the line.

Quote from @Adam Bartomeo:

Almost everyone said communication and although, communication is important it is NOT #1! I am actually pretty surprised at the answers here. It's no wonder so many people get taken advantage of... 

1. Integrity - Hands down is the #1 quality. Even if they are not communicating you can be assured that they are doing the right thing, the right way.

2. Execution - Execution is the reason you hire a PM in the first place, you don't hire them because of their communication skills. You hire them to execute with revenues and expenses. If a PM has integrity and is getting the job done, then there is very little to communicate about.

3. Communication - This is the #1 complaint about PMs throughout the US BUT if you really dig into the complaints then you will understand why the PM isn't communicating. The PM's aren't communicating because they aren't doing #1 and #2!

Adam is spot on here. Although communication makes an owner feel good, especially when an owner wants answers immediately, it does little for their bottom line if you don't have the other two (Integrity and Execution).

I think all the PMs here agree, however, that there is no quicker way to piss off an owner than leave them hanging when they perceive* an emergency. Conversely, you can quickly build rapport and trust by communicating back with them during such an event. Again, just makes people feel good when they get instant answers...

I see you posted this a month ago but wanted to add two cents in case you're still on this.

If you're building a new home, is it in the same spot as the old one? If this is for investment purposes, the costs can vary on hooking/trenching utilities to your new location. Make sure those cost estimates are baked into penciling out the deal. You mentioned sewer, but if there's septic I would get it inspected as well.

I built a strong relationship with our county permitting office. When I was doing diligence on our land they were a huge help, walked me through everything they would need and the types of folks I would need to speak with to get it done. If you already have a builder and architect they'll generally know what you need as well.