It is a common misconception among non-landlords that “you buy a rental, put a tenant in and sit back and count your money”. Nothing could be further from the truth. To all the self managing landlords out there, I applaud you. As one myself for many years I know how much time this consumes, especially when you are also the bookkeeper, handyman, cleaner, gardener and general dogs body.
Owning one rental, especially if it’s an older home takes time and effort. Owning two, means twice the time and effort and so on and so forth. Owning one or more rental properties takes considerable work at times (your weekends too) when you run them ethically and legally. When you own a rental you are in business and it should be run like any other business out there.
It’s tempting at times to think “I’ll do the inspection next month and then before you know it, six months have elapsed and you still can’t find the time in your busy life to do it. Meanwhile your tenant is thinking “great , my landlord hardly ever comes by, I’ll do as I please”. Circumstances can change rapidly so if you’re not doing three month inspections, every three months you’re not in control.
Although you may instruct your tenants to call immediately if something breaks down, they often don’t. If repairs are not done in quick time, it will often result in a more expensive repair bill.
When you do an inspection, you are performing an examination of the premises. Looking in cupboards especially under sinks and basins where there can be water leaks and looking in wardrobes where there can be mould. Checking under furniture for signs of carpet beetle and beetle damage as this is a problem that in recent years seems to be getting worse.
An inspection by a property manager or landlord shouldn’t be a 3 minute walk round to check to see if the property is reasonably clean and tidy. You need to spend the time looking deeper otherwise you can find yourself with an expensive repair bill.
So, what is best, should you hire a property management company or self manage? It all comes down to individual situations, affordability and time management. People who place high value on their time predominately use managers to look after their rentals. These people feel that $25-$35 per week is money well spent. Currently Lanwayke Property Management has a cap on the management fee of $35, no matter how much rent we collect. You pay a 7% fee including GST until the fee hits $35 and no more.
Regards Wayne Hawke.