http://www.REIClub.com – Are Property Managers Better Landlords Than You? Here's a Video on the Pros and Cons of Using Property Management…
Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I've got quick video on the Pro's and Con's of using a property management company.
Institute of Real Estate Management (IREM)
– Certified Property Manager (CPM)
– Accredited Residential Manager (ARM)
– Accredited Commercial Manager (ACM)
– Accredited Management Organization (AMO)
What do Property Managers do?
– Collecting and Depositing Monthly Rent Payments
– Control Rental Rates – based on market trends
– Marketing and Advertising
– Tenant Screenings
– Time Management – property manager takes care of the routine daily tasks, you are free to focus on other investments and/or your own career.
– Remote Locations – manage properties in a different locations
– Access to Professionals – vendors, contractors, etc…
– Housing Regulations and Property Law
– Overall lack in control
– Profit margins – Because they are paid based on gross income, they will not manage the bottom line properly. ie. net income.
– They will never dedicate the energy to your property that you would.
– Money (or CON) – property managers charge a percentage of the monthly rental rate which can range anywhere from 6-10%.
– frequently keep late fees
– may make margins on repairs
– no control over quality of repairs
– no control over who does repairs (family member, friend of mgmt co)
– no incentive to reduce or eliminate repair costs
– no access to own property – usually only they have key
As you can see there are many reasons for both the Pros and Cons, but i'll have to say that the safest way to manage your own property is yourself. I want you to see property management as a tool and a resource, not a necessity. Evaluate what kind of business you are running, if you have 5-10 houses, I say manage them yourself, anything more than 10 I would consider looking into hiring a Property Management company.
Again, this is Frank Chen with REIClub.com. Please take the time to leave your comments for this video below and please subscribe to our YouTube channel so you'll be automatically notified when we upload more quick video tips for you. Take care and good investing.