Buying an investment property is only half the battle. To win the other half, you’ll need to ensure that the property is properly managed.
Now, there are two ways of going about this.
Your first option is to self-manage it, while your second option is to hire a property management company to do it on your behalf.
On the surface, self-managing a property may seem like an easy task. But that couldn’t be further from the truth. Finding tenants, chasing after rent, and responding to tenants’ complaints can be challenging.
As an investor, you should consider all factors prior to deciding whether you will self-manage your investment property.
In this post, we are listing the pros and cons of both options.
Advantages of Self-Managing your Property
1. You’ll save money.
A property manager doesn’t offer services for free. As such, if you choose to do it solo, it’ll mean more profits for you.
2. Decision making will be much easier.
When you self-manage your property, you get increased control. And since you won’t have to consult with anyone, making decisions will be much easier.
3. You’ll get more experience.
By self-managing your property, you’ll be able to acquire crucial knowledge on how rental investments operate.
4. You’ll know that your property is being cared for.
It’s your property! Nobody can care for it as much as you. As such, you’ll do everything possible to ensure it succeeds.
The Disadvantage of Self-Managing your Property
1. It’s time-consuming and challenging.
Managing an investment property is anything but simple. Among other things, it requires diligence, commitment and patience to succeed. Some of your responsibilities will include finding tenants, maintaining the unit, and collecting rent.
2. You’ll need to put in extra work to learn the laws.
You’ll be required to adhere to the statewide landlord-tenant laws.
Examples of such laws include Fair Housing Laws, Eviction Laws, Security Deposit Rules, Warranty of Habitability, and the Fair Credit Reporting Act.
Failure to understand such laws can bring a lot of trouble for you.
On the contrary, a good property manager will have the skills and experience necessary to help you succeed and stay out of legal trouble. Once you hire one, you can rest-assured that your property will run smoothly.
Advantages of Hiring a Property Management Company
1. A property manager will save you valuable time.
What happens when a tenant makes a 2a.m maintenance call? Will you be able to respond on time?
What happens when a unit becomes vacant? Will you have the time to market the property effectively for a quick turnaround time?
Will you be able to chase after rent every month?
These are some of the instances where a property manager comes in handy. A good property manager will free up your time, leaving you time to tend to other important things in your life.
2. A property manager will have vital connections.
Nobody knows the ins and outs of the rental industry more than property managers. They understand how to operate a rental unit for success.
Now, imagine the wealth of knowledge and experience such a person can bring to your investment?
3. A property manager comes as a package.
When you’re a new landlord, it’s unlikely that you’ll have the staff and policies to ensure your investment runs smoothly.
However, a property manager will have everything ready, from rental application forms to entry notices and everything in between.
Besides that, a property manager will help you do the following:
- Take care of the tenant qualifying process.
- Handle maintenance requests from tenants.
- Coordinate with handymen when it comes to fixing repairs.
- Carry out regular inspections to make sure that tenants are taking good care of their rented premises.
- Take action when tenants aren’t abiding by the terms of the lease agreement.
- Handle tenant evictions when it becomes necessary.
- Collect monthly rent payments and deposit them into your account.
The Disadvantage of Hiring a Property Manager
1. You will have to spend more money.
There is always the issue of cost when it comes to hiring a property manager. Fees vary depending on the services offered. And, while some companies charge owners a fixed price, others charge them on a percentage basis.
2. You may choose the wrong company.
In addition to costs, no two property managements companies are created the same. So, if you make the mistake of hiring the wrong one, you’ll certainly set yourself up for failure.
The following are some of the issues you may find when hiring a property management company:
- Inconsistent cash flow.
- Lack of compliance with local requirements.
- Laziness, especially when it comes to rent collection and repair works.
- A poorly maintained property.
- Lack of communication.
Luckily for you, you don’t have to worry about any of those issues when you work with East Bay Property Management.
If you are looking to hire a property manager, we go above and beyond to ensure we reduce your stress and maximize your ROI.
Bottom Line
Self-managing can be worthwhile if you have the skills and experience of successfully running a rental property. However, in the absence of that, hiring a property manager is the best option for you!
At East Bay Property Management, we can help you handle every aspect of your property, from rental advertising to tenant screening to rent collection.
Contact us today for more information!
