Professional real estate investors look at the pros and cons of managing rental properties yourself vs. hiring a property manager.
Even seasoned real estate investment professionals are divided on the question of whether managing rental properties yourself is a good idea or not. Does it make more sense to manage the property yourself or should you spend some of your hard-earned profit on a professional property manager? Read on to see the pros and cons of each.
The question of self-management vs. professional management never goes away. In fact, it is more hotly debated now than ever before. Why? Because there are so many newcomers to real estate investing in the last few years. Meaning there might be some lack of confidence when it comes to self-management. On the other hand, a lot of newcomers just don’t want to spend the money on a pro. And there’s a segment of investors who don’t feel anyone can do as good a job managing property as they can.
- Managing yourself is a lot of work – Putting out rental property and tenant fires can be a full time job. So, maybe it’s better to hand this part of your business off to a professional manager.
- Professional managers know all the ins and outs - You might not know as much about finding and keeping good tenants as you thought you did. And almost certainly you don’t know as much as a professional property manager.
- Can you trust them? – Do you want to leave your property portfolio in the hands of someone for whom it may be a 3rd or 4th priority? If you do it yourself you know it will be a top concern.
- Are they well rounded? – Are they good at management and leasing, or just management? They must be strong in both areas to be effective. Many property managers are good at managing a rental property buy lousy at finding and keeping good tenants, or vice versa. You need them to be strong in both areas.
The question of managing your properties yourself – with all the late nights and tenant sob stories that entails – is one that stymies many real estate investment professionals. The key is to find someone you trust who has some skin in the game. Someone to whom finding and keeping the right tenant is critically important. A good compensation plan tied to their success in locating and holding on to a strong tenant can be critical.