When assessing property managers, does it matter if they personally own rental properties? This question is on the same line of thought as:
1. Are sports coaches
better suited to coach if they were former players?
2. Is it preferable
to have a nanny who is a mother care for your children?
3. Is it better to
have former addicts speak at rehab clinics than clean-cut drug counselors?
You may be saying, “Whoa, Brett… could you come up with a
better example in #2 above? What
percentage of your property management blog readership has gone through the
thought process of having nannies taking care of their children?”
Fair enough.
So, in short, the question is whether actual experience
matters. I would argue that it does in
most cases.
As a Charlotte property
manager who owns personal rental properties, I have several things that
concern me from painful experience.
These may not have the same resonance with a property manager who has
never personally dealt with the repercussions (aka writing big checks to other
people) for the following:
1. Vandalism/Damage:
Is the house in a good enough area that it can sit vacant without being broken
into? Do I need to let the police know
and put “No Trespassing” signs up? Can I
let some of the neighbors I know around the house keep an eye on it? Nothing is worse than fixing broken windows
continually when trying to show it for new renters.
2. Utilities: Am I
going to be stuck with big utility bills when the house is vacant? I’ve received large water bills (from running
toilets) and huge electric bills (from prospective tenants turning the air
conditioning down to 40 degrees when visiting the property) from empty
houses. In the back of my mind I’m weighing
whether I need to keep the utilities on (based on the time of the year) or
checking the home during showings to make sure things are kosher.
3. Tenant Wear &
Tear: After screening a tenant and talking to their former landlords, it seems
like he/she would be a good payer. On
the other hand, it seems like he/she is careless and the house is going to need
major cleaning and touch-up after he/she moves out in a year or two; this is
going to cost big bucks and be a headache then.
I know the short-term expediency of having a tenant move-in right away
is going to turn into pain later after they move-out. I’ve written painful checks for these repair
bills before. My stomach churns thinking
about it.
4. On-Time Rental
Payments: I’ve got mortgages to pay on the properties every month. I need to get the funds on time and in full
so I can pay the bank. It’s not
acceptable to not actively collect late rent; late fees must be enforced to
dissuade late payments and tenants need to be encouraged to be on time. Unpaid days do matter!
These are just a few of the things that I think would be
difficult to understand if a property manager doesn’t own rental properties. It’s one thing to read what not to do in a
property management handbook and another to have to clean up messes with your
own money. Experience is a very good
teacher… and a harsh one.
As a learned man once said, “It’s not that bad to die in a
video game. Just don’t try it in real
life.”
Brett Furniss is the President & Owner of BDF Realty (Charlotte Residential
Property Management), the trusted real estate advisor for Charlotte
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