Should I HIRE A PROPERTY MANAGER or is DIY PROPERTY MANAGEMENT a better OPTION? THERE'S A 3RD OPTION
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- Опубліковано 7 чер 2024
- Should I hire a property manager or should I manage my own rental properties? In this video I'll walk you through the pros and cons of hiring a property management company or taking the DIY property management route. I'll also give you property management tips and tricks.
If you want to hire a property management company I'll show you how to find a good property management company and how to hire a good property management company.
I'll also give you a third option if you want to use a hybrid of these two options.
DISCLAIMER:
WITH ANY AND ALL INVESTING YOU SHOULD ALWAYS OBTAIN INDEPENDENT LEGAL, TAXATION AND FINANCIAL ADVICE FROM A LICENSED PROFESSIONAL BEFORE INVESTING ANY OF YOUR OWN MONEY.
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Managing Your Own Properties
Pro #1 - You get to learn all about property management and how it works. If you end up hiring someone in the future, you've already got the necessary knowledge on how things should and could work
Pro #2 - You can save money. Property managers are usually paid anywhere between 6-10% of the gross revenue the property brings in every month so if you're doing it yourself there could be savings here.
Pro #3 - You control your business. The success of your business will depend on you and you alone.
Con #1 - You are the first and only line of defence against your tenants. You will have to take calls in the middle of the night, and be their primary contact.
Con #2 - This will take you time... and time = money.
If you want to manage your own properties here are some tips for you.
Tip #1 - Learn all of your local rules and regulations. Each province and state has a separate set of rules that landlords and tenants must abide by. Make sure you know the rules inside and out.
Want to manage your own properties? Take the quiz - write your answers in the comments section below.
Question #1 - Can you evict tenants in the middle of the winter?
Question #2 - Can you ask a tenant how old they are?
Question #3 - Can you evict a tenant if they get a pet and specifically says they can't have pets in their lease?
Tip #2 - Pay yourself as a property manager. Take 6-10% of the revenue you bring in on a monthly basis and pay yourself as a property manager. This accomplishes two things. One, it's a write off for the property so you'll pay less tax and if and when you decide you want to hire a property manager you'll already be used to paying that 6-10% and it won't affect your cash flow.
Tip #3 - Use Reciprocity. Reciprocity is the idea of giving and taking. On the day my tenants move into the property I give them a $20 gift and throughout the year I like to touch base with my tenants and with a small gift let them know I appreciate them as my customers. This will not SOLVE ALL OF YOUR PROBLEMS but it does help create a relationship with you and your tenants.
Tip #4 - Make sure you do your rent increases each year. Every province has different guidelines when it comes to rent increases. Follow the rules and regulations and give those rent increases because I can almost guarantee your costs will go up each year as well.
Tip #5 - Never represent yourself as the owner of the property. You are always the property manager. This gives some much needed separation between you and your tenant and will help in cases when there is an ask or dispute.
Hiring A Property Manager
Pro #1 - They should already have systems in place such as accounting, tenant management, yearly inspections and preferred tradespeople.
Pro #2 - They may be able to get higher rents. Based on proven marketing strategies and negotiating tactics a property management company may be able to get higher rents.
Pro #3 - There's a level of separation between your and your tenants. This will help from a liability perspective and also from how many things you'll actually have to deal with.
Pro #4 - You get to focus on your strengths and free up more time to do what you do best as an investor.
Con #1 - The property management company will ALWAYS act in their best interest in the case of a conflict.
Tip #1 - Know what you are responsible for and what they are responsible for.
Tip #2 - Get a rental guarantee when you can.
Tip #3 - Read the rental contract.... every single line
Tip #4 - Make sure the company you choose has a web-based digital system that you can keep track of everything.
The HYBRID option
Pro #1 - You get to control more of the process.
Pro #2 - You get to manage all of your finances.
Con #1 - You will have to deal with staff turnover and may have to train new people sometimes.
Con #2 - It will still take up some of your time. More so than hiring a property manager outright.
Tip #1 - Teach your people your system and make sure they follow it to the letter.
Tip #2 - In the beginning, make sure you review everything. All documents and communications should flow through you - Фільми й анімація
I'm a landlord of two five plex townhouses, I manage everything myself and I love it. Don't waste money on property managers. Oh come on, yes you can do it yourself, if some thing went bad and needs fixing just do an online search for a handyman or plumber and they'll be there and you don't even need to be there, if you use a property manager for any repairs, sometimes they charge you 10% of whatever the repair bill is.
What state do you own in?
"To obtain financial freedom, one must be either a business owner, an investor, or both, generating passive income, particularly on a monthly basis." - Robert Kiyosaki. I wasnt financial free until my 40’s and I’m still in my 40’s, bought my second house already,earn on a monthly through passive income and got 4 out of 5 goals, just hope it encourages someone that it doesn’t matter if you don’t have any of them right now, you can start TODAY regardless your age INVEST and change your future! Investing is a grand choice I made..😊😊
I understand the fact that tomorrow isn't promised to anyone, but investing today is a hard thing to do for me now because I have no idea of how and where to invest in.I would be happy if you could advise me based on how you went about yours, as I am ready to go the passive income path.?
Understanding the intricacies of investing is crucial. That's why it's important to have a reliable support system, such as a financial consultant, who can guide you, especially when it comes to selecting assets. Personally, I work with Regina Louise Collaro, an investment advisor who collaborates with a licensed wealth management firm. I must say that my financial journey has been exceptional under her guidance. Regina is widely recognized for her excellent services, so you may already be familiar with her. Thanks to her expertise, I have achieved financial stability and now earn a consistent monthly income through her passive income strategy.😊
I value your recommendations. It's challenging to locate a trustworthy person. I could really use your investment advisor after seeing how much money you've made through investing. If you don't mind revealing her information, that is.
She is easy to find , make a quick research of her on the internet with her name Regina Louise Collaro and leave her a message. I believe she works with anyone independent of their location.
You are correct Lawrence , I am only one of many who gained from working with Regina Louise Collaro. I had no reason to live when I lost my job due to COVID in 2020, and it will always be a memorable year in my life. Regina made it possible for me to live comfortably through passive income, thus I owe her my life. To be completely honest, I think she is an angel who was sent to help those who are struggling financially.
Or a 4th option! Here's what I've learned after owning a couple rentals. Be your own property manager! Wait! What I'm saying is setup a "fake" (it's not really fake per se) pm company and by no means tell them you are the owner. Nothing illegal about it as you are only managing your own stuff. Here is why. Every loser and their grandma specifically targets properties that have the owner/landlord doing it themselves. Why? Because they know they can pull on your heart strings "oh I don't have the money right now" "that little dog? it's just my friends dog" blah blah blah!!! Do NOT tell the person you are the owner and simply pretend to be a property manager. Then proceed to not give a shit when they give you dumb excuses. Just send notices under your property management company. You'll be able to find and attract much better tenants.
Love the Wanaka tree painting, good insights, thank you!
Thank you!
You know your stuff. This was confirmed when I looked at the topics that you cover on your channel. Subscribed.
Awesome, thank you!
Love the hybrid option!
A good on site manager or off site who will work with you is Great! Your a team and its much better👍👍 Treat them right with bonuses👍👍
Absolutely
Great video I live in California, but I'm looking to purchase more properties in Erie County New York and we have a duplex in Buffalo and we're gonna live in one unit while we fix up some other properties we have but I want to get a property manager cause I have no idea about the laws pertaining to snow removal, etc. and it just seems easier since we live so far away but yet we're only running The unit for about 800 so I'm kinda like dang there goes most of our profit giving up to property manager
New subscriber here...Excellent video and suggestions Darren. Thank-You for your knowledge and insights!
The hybrid it is in indeed !!
Great video!
Great Video. Thanks!
Good info
Love the tips thx
Happy to help.
i like the hybrid type. thanks.
Good choice!
Wonderful👌👌…I m starting my own Property Management very Soon!
You would love our videos if you are trying to get into the industry!
I’d prefer the final say in tenants and give them the day to day issues
Ya that's why I love the hybrid model.
How has your channel not blown up yet? This is gold!
Thank you for the positive feedback and I am glad you are enjoying the content!
Agreed, keep it coming!
Great information you made some great solid points that help us realest investors to think about the DIY of property management.
Great information. I really do like how you pack so much info into a short video. Also, like the hybrid PM model. Thanks again for sharing!
Thanks Gisele. We just switched another property over to the hybrid model that we were having an issue with our PM. Our profits are up and headaches are down.
The biggest con to managing your own property is "emotions", many self managing people get very emotional to issues when something goes wrong and they end of not following the law, which leads to negative tenancies.
Agreed, that is right on. It is not a hobby but a business. Remove emotions and follow a system
Thank you. Great video. I live in kingston and I bought an investment property in windsor. I hired a property manager
Yes good call. It's hard to manage from such a distance.
Sometimes hiring a PM is the way to go. It really depends on your goals.
When I was trucking, I had a property manager for my rent houses, and she was excellent.
I am glad you had a good experience
Such a resourceful video! Love your content! Keep it up Darren!
In Maine you can evict tenants in the winter with a 30 days notice. You cannot ask someone how old they are as it’s age discrimination. You can evict a tenant for any breach of contract such as moving in a pet when it is against lease terms (service animals are not considered pets and are excluded).
Surely you can ask for a copy of their drivers license and make your own age discrimination call, without asking one’s age.
Such great info. Thanks for your comprehensive tips - makes the decision much easier.
Thanks Kathryn. This really changed my business when I started to implement these things.
You can ask their age. The need to be of legal age to sign contracts.
What I generally do is have a check box that asks if they are over 18 years of age. If you get a credit check done, you'll need their birthday but I usually ask them to provide one for me so then I'm not gathering their personal information.
You are Right on managing yourself👍 You will do it better. Also property management co. They don't have your best interest....I've been watching them Lie, hide and avoid issues with property owner for 3 years 👎👎👎 They just want your money and to not have to talk to you
Would you agree this happens in all industries? Curious on your thoughts
You can not evict for pets and you can not deny pets with some exception, A, is the pet dangerous. B. Is it an excotic animal (again some exceptions) you can limit number of pets.
Thanks for taking the quiz Peter!
I rent three rooms in my home and also live in it. I'm thinking about moving to Colombia in 2025. Should I try to continue to manage this as a rental property or should I sell my home?
Hybrid option seems legit but if the property manager you hire realizes that he is doing everything for you and he’s not getting a raise of some sort then that is the reason I believe their is a high turnover rate.
Definitely one of the down sides to hiring someone is that they may leave at some point. I've had my team for over 5 years now which is great.
Wouldn't the Tennant just see your name on the lease? Id be weirded out if some person was passing themselves off as a property manager when they're the owner.
You can put the name of your company on the lease if you have one. I also usually say I'm "one of the owners" which helps too.
Nice man, I'm a novice investor but I was thinking of this tactic as well. Where you set aside some money for gifts, during the holiday season.
First to hear from an investor.
Reciprocity is a great tool in any business. It won't solve all of your tenant problems but it definitely helps.
Great video. But I'd also say a pro for having a PM is that it is tax deductible.
That is great thought and solid tip
no not in winter, no cant ask age, pets, it could be a service animal.
In Ontario, by law you cannot evict anyone if they bring a pet once they are in...
👍
yes, no, yes.
Is the Hybrid type going to require a Real Estate License or any other applicable state requirements? Or is it bypassed as the rent never touches their hands?
Thank you for the tips! Quick question - when you say pay yourself first, should I do W2 or just a 10% payment to myself with No W2?
Really good question to discuss with your CPA. It really depends on your personal goals.
Great video. Really liking the hybrid system as an option for out of province. Can this work for a short term rental as well?
NoFearJoe Thanks so much. The hybrid works great for an out of town rental. Yes, I’ve used it for short term rentals. I would manage all the bookings remotely and have someone on the ground deal with cleanings, turnover, maintenance, etc.
Management in 2024
I have five plut land in the area in Fulton/Clayton county Georgia, Jonesboro I need tips
What's the best top real estate property management ⚖️ software
No. However there could be exceptions although I do not kn w if there are.
Is this in response to "Can you evict in the winter months?" If so, there is no restriction when evictions can take place. As long as you have grounds to evict, it doesn't matter what month it is.
Thanks for this. Please keep the great information coming. Starting out in real estate so this is valuable. Should we do LLC like people say and is it one LLC or multiples for each property? This part not sure about
So the best way is to do a series LLC, and put each property in it's own LLC within the series. That will give you more protection. Vs. having all of your properties under just 1 LLC. God forbid a tenant or someone tries to sue the LLC, they will be able to see all the other properties it has. And can come after those as well. Hope that makes sense!
Solid points! What are your thoughts on hiring a property manager vs. getting a software (like DoorLoop or Propertyware) to help you do it yourself?
Just demoed with DoorLoop myself and I am heavily considering it. You should demo DoorLoop, Innago, and Property Matrix!
Curious if you both manage your own properties? I'm considering letting my property management company go.
What apps or program you recommend me using for rental payment so that tenant pay late charge fee are automatically included??
Did u fig it out? Curious too
A lot of good software companies out there. I would start with appfolio or door loop. I am not sure how many properties you manage.
Tip 4: your allowed to do rent increase with the same tenet in place ? Does this have to be in the contract saying that rent will correspond with the provincial law?
Will work if sent in 90 days
Sorry for the load of questions Darren
Hey Mike. Yes, you're allowed to do a rent increase with the same tenant in place. You have to follow the rent increase guidelines in your province or state. Some have no rent control (you can raise it to whatever you want) and some have very strict rent control (you can only raise it within the allowable guideline). Most tenant laws protect against raising the rent more than once in a 12 month period and most have a 90 day window for the increase to take place.
@@DarrenVoros when is it most appropriate to instill the 90 noticed ? Beginning of every year after giving 50to100$ Christmas gift ?
Bad sound effects in background
will do better next time. Thank you for your feedback.
@05:14 you have an cute roommate...
She's not a huge fan of my videos tbh :)
@@DarrenVoros @04:48 she is waiting to find out the answer evicting pet owners question :)
No to all 3 questions ?
Actually you can evict in the middle of winter. There is no law regarding the time of year that evictions can not occur. You're correct on the other two though.
Property management companies neither have the owner or the tenants interest at heart. Super shady.
Hmmmmm do you feel this way about all business owners and industries? Curious
@@ErnestoJudyAndujar1 No. Have friends in business and friends who rent homes. Daughter is in business, so, again, no. Not sure how you jumped to that conclusion based on such a limited amount of info.
@@Lorna-JWB I didn't make a conclusive statement. I asked a question. I was curious why you made your statement about property management companies. I think you will find "super shady" people in every industry. Would you agree with that statement?