Should You Use a Property Manager Or Do it Yourself?

At some point, every real estate investor is going to have to make the decision of whether they want to manage their property on their own or if they want to use a property manager. This can be one of the most important decisions you can make when it comes to your property and there is a mental checklist you need to go through before you make your decision.

How comfortable do you feel managing your property on your own? There are about a thousand variables that go into this question. Is your new property five rental units or 50? Are you new to buying rental units or are you an experienced veteran? Is management in your blood and something that you enjoy or do you feel more comfortable walking around with a tool belt and a smile instead of a clipboard and eviction notices? These are all questions that you’ll have to answer before you can decide which route you want to go.

Maybe the deal breaker when it comes to hiring a property manager is the budget that you have for your investment. If you’re a first time or small time investor, chances are you’ll be doing as much of the work on the property as possible and then bringing in contractors only when you have to. Most investors, when they start, don’t have the money to hire a property manager, even if it would make their lives easier.

Another major factor that goes into the decision is how close you are to the property that you’ve bought. Many investors move into their new investment and become the de-facto managers. But if you’re living on one coast and you’ve just invested in a 100-unit apartment building or even just a house with two tenants, you probably want to hire a property manager to watch over things since you can’t be there in person.

In the end it comes down to what you’re more comfortable with. If your comfort zone with a rental property is the repair and construction phase and not the paperwork and office phase, a property manager might be a good investment, even if it means less profit in the end. The peace of mind that a property manager can provide is more than worth the cost. But for most investors, the budget simply doesn’t allow for the hiring of a full time employee to watch over things.

A happy medium for many folks is to use a property manager the first few times they invest in a property, even if it means taking an overall loss on the investment simply to learn the ropes of the job, and then, in the future, you can take over the reigns of property management. Some folks will actually take some classes if they don’t have a business background on property management so that they don’t have to go through the expense of hiring someone. It all comes down to what you are comfortable with and how you feel comfortable spending your money.