Ask anyone who has owned a rental property for any length of time, It’s a lot of work. Owning income properties can be an incredible passive income stream, but if it’s taking all of your time and resources, it’s not such a great deal.
Think about all you would have to manage:
Finding the right renters, collecting payment, things breaking, compliance, managing tenant issues…etc. A dreamy passive income can quickly turn into a full-time job. This is why you can save yourself a lot of time and protect your investment by hiring the services of companies such as We Love Rentals.
Here are a few reasons we think hiring a property manager is moneysmart.
Rental Rates
Calculating Rental rates can be a whole science of its own. Sure, you can skim the classifieds to see what others are charging, but a property management company will have loads of market data to ensure your rental is maximizing income and keeping your rental occupied. This means you keep the most amount of money in your pocket possible. This will save you from those horrible moments where you find a renter way too easy and think, “am I not charging enough?” or you struggle to find renters and think, “Am I charging too much?”
In other words, partnering with a property manager brings you valuable peace of mind.
Management
I know, management is right there in the name, but there is a lot to be managed with your property. Firstly there are managing payments. Collecting money can be a monthly struggle, property managers have efficient, tried, and true systems to handle payment collection, so you just get to see that money hit your bank account. On top of that, there’s Managing the Tenants! From marketing and advertising the property to finding the best tenants, to vetting those tenants to ensure you have quality renters who will take care of the space and make payments on time. This is a massive process that takes a lot of time and resources. And if you don’t know exactly what you are doing, trial and error will compound those mistakes.
Maintenance
Let’s face it, things are going to break. A huge benefit to property managers is they already have reliable relationships with local vendors to fix everything from a leaky pipe to a burnt-out light bulb. Often managers have negotiated better rates with these vendors ensuring you get the most bang for your buck. On top of things breaking, there is a whole slew of regulations and compliances you have to adhere to. This is something the Property Management Company has experts in, so you can rest assured that your property is in good hands. If you do decide to manage your property on your own, we have written a “handy” guide on how to find a good local handyman.
True Passive income
Property management makes financial sense for a truly passive income stream. A few things to consider:
Your immediate area only has a limited amount of properties that you could manage by yourself. When you partner with a property management firm, you become location-independent. You can confidently invest in properties all over the map. I’d also like to point out the word “passive”.” Passive income means you are not spending all your time managing your property. This gives you more time to research and find more passive income possibilities.
In conclusion, yes, you can manage your income property yourself. If you do, we wrote an article on common property management mistakes. Once you calculate the amount of time and effort involved in managing a property it starts to look a lot less like passive income and a lot more like a part-time job. Owning real estate can be a wonderful wealth builder, but there are smart ways to do it, and there are costly ways to do it. We hope you consider all the pros and cons before you get your first property.