All Forum Posts by: Terry M.

The properties are both in the far west end of what is known as "Charleston Heights", if I'm not mistaken (I'm not a vegas local).   Just south of Summerlin parkway.  We spent days driving around various areas, and it's not the finest posh area, but hardly the scariest place we looked at either.   Each time a tenant has departed, it's taken over a month to find a new one.

Trying to run a profitable investment business, not buying places that I'd want to live myself necessarily...  I found that the rate of return on A+ properties is less than C+ properties. Rents dont rise as fast as purchase price does.  I have a buy and hold strategy, I want cashflow.  For a given amount of capital, I'd rather have 2 C+ units with a higher cap rate than 1 A+ property with a lower cap rate, although the tenant "quality" may be less.

Still, when a PM neglects valid tenant concerns about serious plumbing maintenance issues to the point that the tenant walks out and has a valid argument for contract violation for inhabitable space, that's a problem that changing the neighborhood wont fix.  

 The more stories I hear too, the norm seems to be lousy service from PM's.  It's quite concerning.  Getting a really good one seems to be the exception, not the rule.   If that many can still survive while providing such service, that tells me there may be bigger, more fundamental issues with the overall market that stack the desk against out of state owners, rather than just a sign of a couple bad apple PM's that we had the unusual misfortune to endure back to back.

Since the commission on a single modest 1 bedroom apartment can be more than a years worth of PM fees, I get that any firm that does both selling and PM can afford to profoundly drop the ball on PM and still thrive.

Maybe I need a dedicated PM?

We are fairly new to RE investing, we have a couple 2 bedroom apartments in the Vegas area.  We are from out of state so we rely on local property managers to handle the day to day issues with the properties.

We've had a relentless parade of issues with the lack of professionalism and competence from multiple property managers in the area.  We fired our first PM, and are on the verge of firing our current one as well.  Both are "large" PM/brokerage firms with significant visibility/presence in the Vegas area, and have overall positive reviews on yelp.  However, the yelp average may be distorted upwards due to rating from tenants rather than owners.

I'm a small business owner myself, and I'm continually surprised at the poor service and follow through that appears to be par for the course. I would go out of business if I treated my clients this poorly.  Our first PM placed a tenant who wasnt properly vetted, didnt have the job they said they did, and stopped paying rent. We actually lost another tenant because the other PM neglected requests to repair a plumbing issue in the suite for so many months the tenant walked because they had cause for contract violation.  There are bad tenants everywhere, we rely on competent PM to filter those out.  

We actually had a local agent suggest off the record that the supply vs demand for PM in the Vegas valley is so bad that anyone can do a terrible job as PM and keep enough clients because the service is poor everywhere and demand vastly exceeds supply.  Every PM takes on more clients than they can properly manage, because they can without consequence.

Are others experiencing this?  Is that appraisal of the Property manager market accurate?

Any advice or feedback would be appreciated.  We are considering looking at other markets if we can't get adequate service in Clark country.