Should I self-manage my investment property or hire a professional property manager to do it for me? This is quite possibly the most important decision a rental property owner has to make before placing a tenant. Here are four questions to ask yourself if you’re unsure which route is best for you.
- Do I have the time?
As a landlord, you are on call 24 hours a day. Do you have the time available to make this commitment? If you get a call from an interested prospect while marketing your property but are unable to answer the phone and provide additional information because you’re at work, self-managing might not be the right strategy for you. It’s imperative that you have a fast response time with both prospects and tenants, something that a professional property manager is able to provide on your behalf. Self-managing also means you’re always on-call for maintenance issues. If you are unable or unwilling to answer the 3:00am phone call that your hot water heater went out (studies show that hot water heaters only blow-up between the hours of 2:00am - 3:00am on weekends) you may want to hire someone to take that call for you.
- Do I know the law?
This is a big one and can be the deciding factor for a rental property owner to ultimately choose a professional property manager over self-managing. If you decide to self-manage, intimately knowing the law is critical. An example of this is fair housing, as the laws are extensive and vary on a federal, state and even city level. Do you know the protected classes? If a prospective tenant asks if your property allows service animals and you answer incorrectly, you could unknowingly be in violation of the US Department of Housing and Urban Development (HUD) and risk serious legal ramifications. Do you know how long you can hold a security deposit or the consequences if you’re late? You absolutely must know the law if you are going to self-manage.
- Do I have the temperament to be a hands-on landlord?
While this may not sound as serious as the previous two questions, it’s equally valid. As a self-managing landlord, you will be your tenant’s point of contact for everything and that is often a bigger commitment than landlords initially realize. It’s important to be firm but fair when it comes to handling your tenants and not to get emotionally attached to the property or lose sight of the fact that your investment property is a business.
- Do I have the knowledge to effectively operate and manage my rental property?
Do you know how to advertise your property or the pre-qualifying questions to ask before accepting an application? Are you aware of the proper steps to take when screening a tenant? See our 7 Step Checklist for more information on adequately screening prospects. What about the lease agreement? One of the benefits to hiring a professional is that they take care of the operational aspects a new landlord may not be prepared to handle.
If you feel confident that you can manage your property like a business, then self-managing might be the right approach for you; however, if any of these questions raised concern, hiring a professional might be a better solution. Having an expert on your side can save you time and money, especially if you have a full time job or little experience in property management.
QUESTION: I own a rental property in the ReUnion area in Commerce City. Do carbon monoxide (CO) detectors have to be installed in this rental property?
ANSWER: Yes. The law requires carbon monoxide detectors to be installed in specific locations in rental properties including within 15 feet of each bedroom. Contact a Commerce City property management company or your local building department for more information.
Have questions? Give us a call, 303-255-1990.