All Forum Posts by: Robert Zajac

I need some advice on managing my property manager. Particularly when it comes to maintenance requests.

Some context: I own two small multi families in Cleveland and they are managed by a PM company (B2B property management). This company charges 15% on top of any maintenance requests in addition to their normal fees but all I need to do is approve the estimates - they do all the work/communication with the contractors.

Recently my PM sent me a few maintenance requests: a $1400 to fix some plumbing in a bathroom (clogged and leaking - contractor says they need to cut the pipes, reroute and replace some plumbing, recaulk. Etc) and another estimate for $800 for lead paint testing. And basically I’m just realizing I don’t know how to know if these are reasonable prices or not? They seem high. On one hand I don’t want to fall victim to overpriced contracts squeezing a naive owner. On the other hand I don’t want to be cheap and losing money in the long run bc I’m not properly fixing things. Does anyone have any resources or advice on how to know better about this? I’m mainly looking to educate myself for the long term.

I also am planning to meet with my PM on Monday to discuss pain points and better expectations, I would love to hear what sort of expectations you set with property managers? What you ask and expect of them (beyond the basics) and what expectations can I further establish?

Quote from @Sean O'Keefe:

@Robert Zajac

We work with a lot of real estate investors that provide us with intel on who the top property managers are. I'd be happy to give you some unbiased feedback on PMs in Boise Idaho.

 I would love that! Do you have any recommendations off the bat? 

Hello! I have a friend with a vacant property in Boise Idaho that she's looking to fill and would like the help of a property manager to do so (and to manage after the fact ofc). Can I get some recommendations for good PMs or PM companies in that area? If you are one and you're interested, please reply with any sort of pamphlet of your prices and services. Thank you:)

Quote from @Bob Stevens:

Quote from @Robert Zajac:

Hello! I'm a new out-of-state investor excited to get into the Cleveland market. I've read multiple bigger pockets books and have been part of a RE mastermind discussion group, so I feel I have a lot of theoretical knowledge, but I'm eager to apply that and truly learn from actual experience. I also have plenty of capital prepared for my first investment!

My biggest hurdle right now is in understanding the Cleveland market. Knowing which neighborhoods are better to invest in than others and developing a sense for what to expect investing here.

 So its been 3 months, how many have you picked up and how's it going ? I closed on another SF last week, and will close on two more duplex's within two weeks or so. All have about 2%+ rule 

Hello! Since posting this, I closed on a triplex in Cleveland! I just recently got the third unit rented out - now fully occupied even before my first mortgage payment! Woo!

Today, I'm still wrapping things up with this project and saving up for the next property! Hopefully I'll acquire another asset by the end of the year (but rn I need to save for another downpayment:) ) 

More details/example fees: 

Management Fee: 10% of gross rent collected, $50 minimum per unit.
Leasing: One full month’s rent upon execution of a lease
Other:
 10% will be added to each invoice for any repairs, maintenance, improvements, landscaping, and snow
removal for the Property
 50% of late fees collected
 $50 lease Renewal Fee
 $50 per utility turn on
 $25 posting 3 day notice
 $100 per court appearance witness fee
 $50 tenant removal with bailiff or police
 $50 to meet inspectors for housing voucher programs, occupancy certifications, and/or POS or rental
inspections
 Broker may charge to offset Broker expenses for postage, key copies and other misc. expenses
 $100 set up fee
 $120 annual consortium fee ($60 March 1st, $60 Sept 1St)


Given all this, how do I input it when I'm making calculations for a potential investment (do I put this in as >10% like 12%, 15% or 20%? I notice that tends to DESTROY any potential in a property)

Hello all! I am out of state investing in the Cleveland market and I have a property I'm looking to close on! As such I'm shopping around for property managers. I'm getting concerned because I know from all my BP reading/learning that expected PM rates vary from 5%-10%, so I was preparing to pay on the upper end of that to make sure I find a "Rock Star" PM (as BP books would emphasize doing). But I've looked at the rates of 2 PMs so far and both charge 10% of gross rents + 1mo rent on new leases + a BUNCH of other fees (I'll include more details as a comment to give an example).

My question is: is this standard for the Cleveland market? I want to make sure my property is getting managed well and everything is taken care of such that I minimize vacancy and other tenant issues that would add additional cost and headache, but I haven't ever heard about PM fees being this high. Should I keep shopping for other PMs? Should I negotiate? Should I accept it bc cutting costs here will bite me in the end?  I would love some advice here

Quote from @Samuel Diouf:

I see investors seeing the most success on the west side. There are a few pockets where the numbers look great on paper but are massive money pits in real life. Needing costly maintenance after dealing with break ins, in-consistent tenants, and no one wanting to manage your property.

My team and I, have created a graded map on all major cities in Ohio. I'd be happy to walk you through it.

 Yes absolutely! I would love to see this map and walk through it with you! Let's connect

Quote from @Min Zhang:

Hi Robert! Welcome to BP! I personally love the Cleveland market for its cash flow. I invest heavily in this area as an agent. I grew up on the east side of the town with a well versed knowledge of the neighborhood. I am happy to send you my neighborhood grade map to help you get started. Let me know how I can help!

Yes, I would love to see your map! That would be a great help! Let's also connect and stay in touch talking about the market and neighborhoods; I would love to have more conversations about these to grow my knowledge on it!

Quote from @River Sava:

Hi Robert, welcome!

What types of properties are you intersted in? Have you looked into local meetup groups? I know you are out of state but sometimes you can find virtual sessions that might help with insight. 

I am interested especially in small multifamily properties. Preferably turnkey in a good neighborhood (C+ and above). I know these may not be as lucrative, but I'm looking for something more simple and straightforward as I'm getting started! I imagine myself getting into more rehab intensive (possibly even BRRRR) projects as I build my portfolio and experience!

I have not found any local meetup groups yet, but I would be very interesting in getting involved in some here! Both virtually and possibly occasionally in person as well!

Hello! I'm a new out-of-state investor excited to get into the Cleveland market. I've read multiple bigger pockets books and have been part of a RE mastermind discussion group, so I feel I have a lot of theoretical knowledge, but I'm eager to apply that and truly learn from actual experience. I also have plenty of capital prepared for my first investment!

My biggest hurdle right now is in understanding the Cleveland market. Knowing which neighborhoods are better to invest in than others and developing a sense for what to expect investing here.