What’s everyone think about them?
If I am looking to invest in CT and I live in NY, about 1.5 hrs away do you think I should find a property manager?
I work 9-5 and can not be up there on call if something goes wrong. How much do they usually cost, and are they effective?
Also anyone know any good ones in New Haven County?
I have heard they run 8-12% for single family homes, and anythign higher or lower I should be sceptacle of.
If your main concern is for repair emergencies, you could find a on-call contracting company to use in these cases.
At 10%of the rent so lets say 1500 that is $150.00 per month lets say you drive that 8 times a month… And have 5 properties so that is $750.00 per month…
I would call it at 1.5 hours a 90 mile trip each way so that is 180 miles round trip so 1440 miles a month divided by todays high gas price’s of $3.00 per gallon at say 25 Miles per gallon so that is 57.6 gallons $172.80 in fuel.
then you figure 3 hours each time for the drive and 2 hours there so that is 40 hours a month divided by the remaining $577.20 so that is $14.43 an hour that you are saving by doing this yourself… Plus think of it this way you get all the phone calls and running credit problems yourself. For $14.43 an hour I would let a pro do it.
Just my thoughts.
Yea when its put that way, it seems like a viable solution to have a property manager do it, now the task coems to finding one that will take care of the property entirely. Someone thats great as well. Cause this will be one of many homes that I will invest in, in that area. I am gonna start a monopoly 
…and that’s why reoconsultants says, “Do what you do best, outsource the rest!”…
If I were an out-of-area landlord, I would use a management company.
Keith
which kind of sucks cause if i make 150 positive cashflow on a house that means it will be 0. I basically haev to make twice as much on a home now then i did before.
In “Property Management the Hastedt Way”, we learn to ALWAYS budget for property management even if you manage yourself…that way if you HAVE to use a manager, it’s already worked in…if you don’t need one, you get paid for your time…someday (if you stick around REI), you’ll want someone else to do this so that you can go do the other stuff you want to do in life – this way, it’s already in the budget!
Keith
Keith,
You said you get $175 - $250 PCF.
Does that take property management into account?
Thanks in Advance
I ALWAYS take property management into account…if I manage it myself that money gors into the “reserves” account…like “rainy day money”…or like broken water heater money on Thursday!
Keith
JP,
Now I think you’ve realized what I was talking about. If you use a paid property manager, it sucks the life out of your business when you’re first starting. In addition, you not only lose the cash for the property management fee, but when they arrange the maintenance - they expect a cut AND they don’t care whether they get the best deal or the best contractor. It opens up a whole can of worms. Moreover, who do you think will get the best efforts of the property management company - an out of state owner with one property or a local investment company with 200 units?
Once you have a hundred properties or so, a person may have enough cash flow that you no longer want to take on the hassles of management. However, when you’re first starting…
Mike
Now I better understand the rationale behind starting with wholesales & flips.
It sounds like I’d hit my rental income goal faster by doing deals for $ first.
I can make more $ earlier and, have a stash to kickstart my income properties (or do the two intermittently).
If I were to start with rentals (even with a fair reserve), I could be killed by problems.
I’d run the risk of getting put between a rock and a hard place by a bad tenant.
Neophyte,
Wholesaling, retailing, and birddogging are no panacea either. First, you’ll lose a lot of your profit to taxes - which does not happen with rentals. Second, I don’t know of a single bird-dogger that does REI full time. Can it be done - maybe if you can live real cheap! Wholesaling is the same situation as rentals - you need a reserve anytime you’re going to buy a house. If you are counting on assigning contracts, you better be prepared to buy when the deal falls through - otherwise, you’ll quickly lose credibility after a few failed deals. In addition, you will lose your deposit and some angry seller may sue you for specific performance when you breach the contract.
The truth is that almost every type of REI (except birddogging) takes money or credit. If you don’t have either one - you’re not a player!
Mike
I’m gonna try and save 15 or 20k (I’m still in college but, I’ll do whatever it takes).
I know that I need a reserve to make payments in case it takes a while to sell a retail or if I can’t find anyone to assign a contract to.
I don’t think I’ll find investors around here that want a birddog.
My parents are basically telling me that I can’t do it even if I save 15 or 20k.
They think I’m delusional.
I’d really like to prove them wrong.
Thanks PM
This was some good information. Reoconsultants: I like how you make it about the math. The numeric approach really brings you to the right answer.
Thanks.
i’d let a property manager handle it regardless of the cost.
i’m currently managing 4 homes in utah from san diego. one of the
tenants is having a tough time pay the rent on time. i had to hire a lawyer to make them pay 2 months rent in june. now they’re again
late. they always have good excuses, [ like heart surgery ] but that
doesn’t pay the rent.
much less hassle to let prop mgmt deal with the problems.
as i’m planning on buy several more i’m moving everything to PM.
no way i can deal with all that crap and carry on my fulltime job.
even if i didnt have a fulltime job, its still not worth my time.