The decision to hire a property management company is not one that many home owners take lightly. After all, putting someone else in the middle means that you get a smaller slice of the pie.
Or does it it?
Let’s look at some ways in which using a property management company actually helps get as much money into your pocket as possible – which, let’s face it, is exactly where it belongs.
Time is Money – Especially Your Time
When you sit down to think about what managing a property entails, lay out a salary for yourself. Think about what you’ll be doing, and what your renters will be expecting of you. If you were ever a renter, try and go back to that time – what did you expect of your landlords? Match those expectations to yourself, and try to put a dollar number to it. Do you have the hours every month, or week, to match that salary? Do you have the ability to afford paying yourself that, while still breaking even on this?
With a property management company working for you, there’s no math to figure in trying to decide if your time is going to be made worth while… because you’ve already made the decision that your time is more valuable than anything else.
DIY Can be Costlier Than You Think
Even assuming that you’re a tried-and-true handyman who owns all your own tools and knows their way around a circular saw, doing your own repairs gets expensive… fast. Even something as simple as a leaky faucet can potentially lead to any number of great home renovation problems. Not to mention to the repairs that are fairly cut and dry – there’s still all the components of evaluating the problem, driving to the hardware store, purchasing the parts, returning to the property (all within a time frame that works for both you and your tenant), hopefully fixing the problem on the first go, and leaving all without having any second problems arise, or hearing, “Well while you’re hear…” from your renter.
A Property Manager Won’t Get Sick of the Business
People become landlords for a variety of reasons. They buy a second home, but have trouble selling the first and so it becomes a rental. Or perhaps they get curious about what a second income might look like, so they buy another home and rent it out. How long do you think it will be before you’re throwing your hands up and screaming, running stark mad into the woods? Managing properties is not for everyone – but you can be guaranteed that a Property Management company is vested in having this be something they will work hard at every day.
While you may wake up one morning and not want to deal with your tenants, that will never happen with a Property Manager. You may start eyeballing your renter’s agreements, scheming ways that you could evict them early because you want out – again, not something a property management company would ever do. The honeymoon may eventually end for you – but for a property manager, this relationship is about the long haul.
The Math (Likely) Doesn’t Add Up
Let’s look at some easy numbers. Consider the idea that by managing your own property, you save an estimated $200 a month. Let’s further assume that you spend around 10 hours every month (or two per week) handling those properties – everything from running around town to check on houses, calling up handymen (or doing it yourself), stops by the bank or notary. Every bit of the business. What you’ve found yourself with is a job that pays you $20 an hour.
Instead, you could pass on that “saved” $200 a month, and focus instead on the part of property management that actually makes money – acquiring more properties, planning renovations to boost the rent, devising income plans. In the long run, letting a Property Manager do the “busy work” for you means that you get to do all the fun stuff yourself.
One Legal Bout Can Ruin All Your Fun
It’s easy to have an, “Oh, but it’ll probably never happen to me,” opinion about having to drag a tenant to court. You can just cross your fingers and hope that you only ever have great renters, or that even if you do have a few “difficult” ones, they’re never bad enough to need the court involved. The truth is, even within the world of small claims court, fees rack up to staggering heights. The most well-researched landlord is likely not as knowledgeable about tenant rights and property law as someone who works in the field, meaning you can trust yourself to be in the hands of someone who is working to keep you – and your renters – out of court.
If you own rental property in Colorado and would like to discuss options for property management and tenant placement services please give Housing Helpers a call at 303.545.6000.