Finding the Right Property Management Solution in 2023 (And When You Can Manage It Yourself)
As a real estate investor, it is important to be able to sleep easy knowing that your properties are in good hands. That is why it is essential that you work with a property manager that you can trust completely – even if it is yourself!
There is a huge array of different management solutions available for your income properties. From independent property managers, to large management companies, to managing your own investment properties, each solution has its own advantages to suit your unique investment portfolio. However, much like how each management solution has its own advantages, there are also situations where you may need to consider different options in order to find meaningful success.
So, in order to help you select the ideal property manager for your real estate investments, let us take a look at the different property management solutions and the pros and cons of each.
Self-Management
For many new residential real estate investors, the best option for property management is self-management. After all, if you are only getting started out you may not be generating enough cash flow to pay a property manager while still turning a profit for yourself. Self-managing is also the only property management solution that does not require the manager to be licensed.
Self-management is a reliable strategy for investors who have smaller portfolios and are in the position to turn real estate into their full-time job. However, self-management is often seen as a temporary strategy because as your portfolio grows the amount of work required to manage all of your properties will continue to rise and you may require another property manager or a property management company down the line.
While it can be a great early option, self-management does not work for everyone. For investors with full-time jobs or multiple jobs, self-management may not be a reliable solution due to the limitations of their schedule. Additionally, by managing your own properties you will have to be available to your tenants in the event of urgent concerns. This can result in tenant phone calls at unwanted time and an increased level of day-to-day stress.
Independent Property Managers
Independent property managers are another excellent choice for new investors or investors with smaller portfolios they are looking to manage. These managers are often pro-active and try their best to keep everything organized while also saving you money.
For these individuals, property management will ideally be their full-time job. This allows them to dedicate the maximum amount of time to your investments and your tenants. These managers can range from a friend or trusted colleague who is properly licensed, or a skilled professional you have found or were referred by a fellow investor.
Unfortunately, an independent property manager has their limitations, since they are doing the job by themselves, you may find yourself in the position where you have to take charge and do some of the work if they were sick, out-of-town, on vacation or simply busy with other important things. Using an independent manager, much like managing your properties yourself creates a limit on the number of properties that can be adequately managed. Eventually as you buy more properties you will need to hire additional help or transition to a larger property management company.
Discover Residential Property Management With This Step By Step Guide
Small-Medium Property Management Companies
Unlike self-management or independent managers, property management companies have the advantage of a full staff ready to maintain the same quality level of service regardless of whether a manager is sick, out of town or unavailable. These solutions often make it much faster find, organize, or update information regarding your properties due to having an admin team taking care of the majority to data processing and storage.
Property management companies also frequently have their own maintenance specialists or are connected with a network of professionals they can call on easily when the need arises.
While not as much as smaller-scale solutions, small to medium sized property management companies are also quite flexible with their business structure allowing you to have a voice in the specifics of your property management strategy. However, typically these companies will work with multiple investors so your properties will not have the entire company’s attention at all times, but this is not a massive concern when compared to managing your properties through a larger corporation.
Large Property Management Companies
For large-scale investors and large investment firms, large property management companies are the way to go. These companies usually offer a lower price to manage your properties when compared to smaller options, but this is due to the volume of properties they are managing at once as well as the increased efficiency in their workflow due to their scale.
Managers within these companies usually are specialized in specific aspects of property management meaning your properties will often have multiple sets of eyes on them. However, as they have multiple departments and points of contact, there is room for oversight and miscommunication. Some companies do offer a single point of contact but getting information may take longer due to the need to communicate with multiple departments. Overall, the primary drawback of this solution is the danger of you and your investments getting lost in a larger client pool without any personal connection to you and your tenants.
To learn more about residential property management and the wider world of real estate, contact us at LendCity. Our network of investors and real estate professionals are more than willing to help you find the solutions you need for your portfolio. As well if you are ready to continue expanding your portfolio or are getting ready to do so, give us a call at 519-960-0370 or visit us online at LendCity.ca Alternatively, click the link below for a free strategy call today.