Self Manage or Hire a Property Manager! Which is right for you?
One question I get all the time is about buying property long distance. You probably know by now that I own property throughout NY and then also in the Dominican Republic. Whenever I mention DR, the next question is always about property management. If you listen to the Lady Landlords Podcast, you know that I have both used a Property Manager and have self managed properties even from abroad.
And both can be done successfully!
Taking on a Property Manager can be a great way to help you grow your portfolio and the decision to use one really comes down to your situation and the details of the property in mind. I see a lot of Lady Landlords shy away from using a PM due to the costs involved. But, if planned right from the start, using one can free up time and energy that can be spent on finding the next property!
I also fully believe in letting experts be experts so if having a PM, realtor, or someone else in your pocket would be helpful, then why not go for it?
But, you have to weigh the Pros and Cons!
Here are 3 Factors to consider when deciding to hire a Property Manager:
1. Your Time.
One of the main reasons to hire a Property Manager is to save you time. PMs are the first point of contact for a tenant, meaning you...are not. Therefore, they are the ones getting maintenance calls in the middle of the night and are tasked with playing the endless game of phone tag between tenant and handyman to schedule service calls. To me, the biggest time drain being a Landlord is at Tenant Turnover time. You have to make sure one tenant left, complete the walk through, deal with a security deposit and ready the unit for its next occupant. At the same time, you need to get your ad out there. And if you have done this before, you know you will get a ton of tire kickers that need to be sifted through. Then, you have to schedule showings and start verifying information. Then, when you FINALLY get someone in, there is usually an adjustment period for the first few weeks until the tenant is settled in. If you are exhausted after reading these past few sentences, then a PM may just be right for you!
2. The Money.
When I analyze properties, I always do two calculations: one without the cost of a Property Manager and one with the cost of a Property Manager. I want to make sure that I have cash flow both ways. For now, I self manage my properties in NY that are within an hour of my current home. But, if you have been following my journey for a while now, you know that some day real soon I'll be living down in my beach paradise in DR. My life will change just like yours will and you want to make sure to account for a PM IF at some point in the future you choose to use one. I CAN manage from abroad, but I probably won't want to! And that might happen to you too so make sure to account for the cost from the start so you always have the option!
Where you buy might also have a huge impact on your decision to use a PM. Due to current market conditions, I see more and more investors choosing to buy long distance. For a newbie investor, this can be intimidating to never see the ACTUAL property! I always suggest to look into places where you know at least somebody in the area. But a PM can be that person you are looking for. If you want boots on the ground that can help with understanding neighborhoods, rental comps, finding the best service providers, then building a relationship with a PM could prove invaluable! Might even lead to an off market deal if your PM can get the inside scoop! Opportunities are endless when you put the right people in place!
So what's it going to be for you? PM or No PM??
Have a Happy Tuesday!