I’ve been discussing a potential promotion which will require a relocation out of state…actually a few states away. However, one of the only things holding me back are the rental properties I own. Unfortunately, I bought my first duplex 2 years ago in the peak of the Cleveland market so I don’t have a ton of equity to unload it quick. To add to the dilemma, I just closed on another duplex just over a month ago. The second was purchased at a decent discount and cash flows very well. I’m considering talking with a property management company and holding onto the houses while I live out of state.
Is this a good idea or would it be more of a hassle than the cash flow is worth. Have any of you been involved with a management company and do you recommend going this route?
Any advice or suggestions would be greatly appreciated. Thanks in advance!
If the properties can cover the cost of the PM company, it should work out. You’ll have to choose a PM very carefully, but You should also be well informed on the maintenance costs on your properties by now. PM companies can run up the costs on absentee landlords. Are you planning to build a rental business full time or as an income supplement? If you relocate, can you profitably invest there as well?
The answer depends upon whether or not you will return to your current town any time soon.
If you aren’t going back, sell and 1031 into new properties at your new location.
If you know you are going back, then hire a property manager and keep an eagle eye on them.
Don’t be afraid to be a little creative…perhaps another investor would be wiling to keep an eye on things for some type of trade, i.e. equity portion, 1st option to purchase at a later date, whatever. Check your local REI meetings. The point is there might be different way, don’t just lock into the property mgmt company thing.
all the best,
I also agree that if you go with a property management company, at least have a friend or fellow investor check up on the property to make sure the company is doing its job.
Good Luck in the new location and let us know how you are investing there.