All Forum Posts by: Samuel Mes

Quote from @Samuel Mes:

Also, curious as to how self managing works when you want to go on vacation and switch off for a month and not feel like you're on call 24/7. I guess a property management company for that 1 month can't be too lethal, can it? 

This is where relationships come in. I recommend you go to your local REIA. Talk to other investors and perhaps you could make them a point of contact when you are a way. You can reciprocate the favor. I just go and deal with issues if/when they come up. I was just away for a week and didn't get any calls.

You are not going to get a property manager who turns on and off a month here/there.

@Samuel Mes

Depends.  On 3 of my properties I have a "worry free" contract on the furnace and AC units.  I shared the information with the tenants so they call them direct in case there are any issues.  that is the only insurance I carry.  I don't have the insurance on the other property because the gas company doesn't offer any of the services, but my HVAC guy doesn't live far away.

As for plumbing, appliances or anything else I don't carry insurance.  Most things:  closet falling off track, leaking shower, etc... can be fixed by a handyman and most likely, wouldn't be covered by a home warranty company.  If appliances break, I purchase them from a scratch and dent place and just get new one.  The thought there is if I spend $200 to repair a fridge, if it doesn't work, then it is going to cost another service call along with an angry tenant.  The other service call puts me about half way there.  I rather get a new appliance and call it a day.  Others would say I am crazy, but piece of mind for me is worth it.  Again, a luxury I have with having an additional $8k in my pocket from self managing and it keeps the tenant happy who will then stay longer and decrease turnover.  Also it gives you justification to raise the rent next go around and the tenant has a new fridge.

Again, for the warranties I have - the tenants are instructed to contact the warranty company directly, not me.  I gave them the account number and phone number.  This ensures that they get the quickest service and there is direct scheduling.  

As for scheduling, I do not get in the middle of that game. I give the handyman direct contact with the tenant and let them figure out schedules.  I will get told later on when things are scheduled so I know when things are going to be done.

As for the benefit?   I don't know if there are any benefits when things break.  It is a matter of convenience in getting things repaired.  One thing that I had to learn is that not everything is an emergency or a crisis.  You are going to have those stubborn repairs.  As long as you show that you are doing your best to get progress towards the solution, any reasonable person will be appreciative or understanding.  I get my repairs to be as hands off as possible.  I  don't go to the repairs myself unless I feel there is a need. I do follow up with the tenant , usually via text, to check in and see if things are OK.  

I also am a REIA member. If there is someone that I need and don't have access to I ask my fellow investors who give references. I will go with those people.

I hope this helps.

I have 4 SFHs that I own and manage. the only caveat and difference is that they are in my area.  However, I am confident that if I had to move, I have made enough contacts that I could get things handled.  Heck, I have had things handled without going to the local property.  

If you have the connections, handyman, plumber, HVAC, etc... Then you are good.  It is boring.  I don't have something breaking every day/week/month.  I haven't gotten a call at 2am either.  I did deal with a 2 yr old water heater that decided to break while I was in Vegas.  I called one of the more expensive companies to come and do the repair at the time because it was best at that time.  I only paid $200 or $300 more.  

You have the benefit of living there, knowing people and knowing the area.  Sounds like you are in a class A neighborhood, which is easier to rent.  Tenant turnover will be a pain and probably require you to make a trip down there, but that should only happen once every couple of years.  I think of it this way:  If i have to spend 20 hours to get something done and I saved $2,000.  That is $100 an hour.  I think it is worth my time.  That is just a turnover.  Not counting the monthly cash flow you will get and you don't have to spend time for.

Try it. If you don't like it, you can always go to a PM. That is the beauty of it. I recommend you join your local REIA. They may have a fprum you can join and get local recommendations.

Yes, a prior poster mentions that private LLs don't raise rents, etc.  Keep in mind, turnover costs money and time.  I don't care the amount of work you do.  Turnovers cost money.  At the very least you are losing a month of rental income.  Generally, PMs make money on turnovers.  They charge you a releasing fee, if the tenant stays.  If they don't stay, they charge you for the work that needs to be done.  usually they make money off that too and then they charge you 1 month rent to get a new person in there.  So if you look at the LL not raising rent as a negative, look at all the money it costs you after a lease is up.  If they charge you a $200 releasing fee, the markup has to be at least $20 a month.  For some tenants/areas that is a lot.  And what if the values of rent don't increase that much and they only get $10 raise?   

I have posts on the FREE systems I use.  In my mind,  I can't justify 10% of my gross collected rent for someone to just answer a phone.  Feel free to look up my prior posts.  

I am not anti-PM, but the dollars and cents don't make me enjoy.  I save over $700 a month which  would be 10%.  Call me cheap, but I will take a couple of calls spend up to 7 hours a month to save that.  Hell, that is over $8,400 a year extra in my pocket.  That pays for most of the repairs I need to do every year!

Don't get caught in the hype.  Try self managing and if you don't like it then get a PM.  My advice.

@Brian Young

We recently switched to a new property mgmt team for our personal multifamily property in Tampa proper. The best things I like about the new company are:

1. -Someone who can respond to my questions via text 7 days a week
2. -A clean, easy to use portal where I can view statements and work logs
3. -A 12 month guarantee, if the tenant is evicted, the property mgmt company puts replaces the tenant without charging us 1st months rent
4. -Allows us to put a MAX threshold hold of $250 for non-emergency repairs. Anything over $250 requires our explicit written approval with at least 2 estimates presented to us from their vendors

Quote from @Samuel Mes:

How do I find out the stats (Im located in Texas) for what properties are being rented out in a certain area? I can see the "for rent" properties on a listing site like MLS but I can't see what's currently being rented. Im assuming Ill have to guesstimate the price point as Texas isn't obligated to list it. Thank you!

Are you looking for generic numbers, like the average rent rate for a 3/2 house? Or are you wanting to check rent rates for specific rentals you are considering for purchase?

Every state compiles data (even Wyoming, which technically doesn't exist). Go to Google and search "rent data [city]" and you'll find plenty of data.

If you are trying to determine what a specific property will rent for, then your best bet is to partner with a local expert like a property manager. Otherwise, study the market heavily by watching online rental sites every day and tracking comparables.

Quote from @Samuel Mes:

How do I find out the stats (Im located in Texas) for what properties are being rented out in a certain area? I can see the "for rent" properties on a listing site like MLS but I can't see what's currently being rented. Im assuming Ill have to guesstimate the price point as Texas isn't obligated to list it. Thank you!

There are two options. I start with the primary and then an alternative solution. 

Primary: call a property management company and tell them you’re considering purchasing a property that you’ve been contemplating but don’t know fair market rent and you looking into hiring a property management company for it. Provide them the details like “It’s a 3 bed/2 bath single family home, built in 2004, 1468sqft on a 4200 sqft lot. I was looking for a quote on fair market rent before I consider purchasing  it and outsourcing to a PM company. Can you provide that information?” The PM companies will be willing to present you with a quote if it’s a potential lead for them. You can always ask multiple PM companies and then average the number for what you would charge. 

alternatively, have your real estate agent pull comps for what has recently sold and their rent values. Just keep in mind that the further away from sale/rent date, the less reliable it is, especially if the market has changed significantly since. For example, if it comes to another fed rate hike, mortgage rates will increase and less people will be buying because they can’t get financed so the demand for renting will increase. 

in the words of Jordan Belfort (Leonardo DiCaprio, Wolf on Wall Street), “Pick up the phone and start dialing. Hope this helps, cheers.