On Sunday, there was a little blurb in the business section of The New York Times quoting Roxanne Quimby, the co-founder of Burt’s Bees, about her disenchantment with being a landlord. Quimby purchased apartments buildings and homes in Florida and Maine after she sold her majority stake in the lip-balm maker back in 2003.
She enjoys running the company but says she “can’t stand” the apartment buildings because she “can’t deal with tenants.” Ms. Quimby said she didn’t use a management company because “I’m so used to being hands-on.”What?? As in what was she thinking? I’m always surprised to learn when people want to manage their own rental properties.
“But these people are calling me because their dishwasher isn’t working,” she said. “It’s like, ‘What?’ ” “So I’m getting out of that,” she said.
Here are five reasons why I use a property management company:
1. The Property Manager can chase the rent. Over the last five years, most of my tenants have been problem free. But one was notorious for paying late and making partial rent payments. My property manager got to be the bad cop every time the first of the month rolled around. The tenant no longer lives there. Thanks to my property manager!
2. The Property Manager has a network of professionals. This includes clout with subcontractors like painters, plumbers and other repair people as well as access to the best leasing agents.
3. The Property Manager can be where I can’t. I couldn’t afford to buy rental properties in California because they didn’t cash flow. My only choice was to go out of state. I own properties in Las Vegas and Phoenix. The property in Vegas I’ve never seen in person. Seriously. I bought it before it was built. My property manager has sent me pictures throughout the years. It’s somewhat out of character for me… since I’m a bit of a control freak. I’m sure if the house was a mile away, I’d be driving by and bitchin’ about the tenant is keeping up the yard or leaving out the trash bins for two days. This way… I don’t have to think about it.
4. The Property Manager saves me time and money. Sure, on paper it looks like a property management company is decreasing my net cash flow, but their services are well worth the price. They typically charge between 5 to 7 percent of the monthly rent. How do you put a value on my time? This brings me to the last point…
5. I make more money focusing on my own career so why wouldn’t I outsource this function? It pays better to put my time into my real job than wasting it by being a property manager.
Here’s further reading about why you should use a property management company:
Evaluating Your Skills for Renting Out Your Property
Should I Hire a Property Management Company for My Rental Property?
Things to Consider when Interviewing Property Management Companies
The Top 10 Reasons to Hire a Residential Property Management Company