Being a landlord comes with a lot of ups and downs, as you know if you’ve been renting out a property for any amount of time. You get to create a steady stream of passive income and set yourself up for some wealth-building returns over the long term. Owning rental property is also a great way to prepare for retirement. You can either move into the home yourself or enjoy the consistent cash flow once the property is paid off and you’re earning profits on the rent you collect.
Leasing, managing, and maintaining a rental property can also be a bit of a headache. It can even feel like a full-time job, especially when you start dealing with repairs, tenant issues, and lease agreements. Do you have the time to show your vacant property to prospective tenants? Can you mediate a dispute between two neighbors arguing about parking or pets? What will you do when it’s time to return the security deposit and you find damage that exceeds it? What if you have to evict a tenant?
Many landlords in Santa Rosa feel like they have a difficult choice, and this may be a question you’re grappling with as well: Should you manage your investment property yourself or hire a professional property manager to do it for you?
We’re going to look at the DIY model and also talk about how professional property management in Santa Rosa can potentially save you time, money, and a lot of frustration.
DIY Rental Management
We talk to plenty of landlords who have a small rental property, a single unit, or a home they once lived in themselves that’s easy to keep an eye on. Managing on their own seems like the best option because they can quickly and easily get over to the rental home if necessary. If this sounds Iike you and your situation, DIY management may make the most sense. Perhaps you have a tenant in place who is easy to work with and pays rent on time and takes care of the property. Maybe you’re living in one side of a duplex and renting out the other side to tenants and there are rarely issues or maintenance emergencies. These are pretty comfortable situations. If you have a small rental property or just a few units to manage, and you’re not thinking about growing your portfolio any larger, then doing it yourself may be a good option.
The benefits to DIY management in a situation like this? You’ll have full control over all aspects of managing the property and save money on management fees. You can set your own rules and make decisions based on your personal preferences and goals. You can establish personal relationships with your tenants, and if you work well together, that’s not a bad thing.
However, DIY rental management is a time-consuming job, even when you have only one unit or one easy tenant. You’ll need to handle everything from advertising vacancies and screening tenants to collecting rent and dealing with repairs. You’ll also need to be available to handle tenant complaints and emergencies at any time of day or night. This can be stressful, and it can take away from your personal life and other business activities.
There’s also the potential that your one good tenant, with whom you have never had a problem, suddenly cannot afford rent. What will you do to collect it? How will you approach eviction?
Just because DIY management is working for you today doesn’t mean it’s always going to be the right thing for you or your property. Keep an eye on how much time its taking from you. Measure the amount of money you have to invest in keeping the property occupied and maintained. When things begin to feel challenging, you might want to consider a shift in how you’re handling the management of your investment.
Hiring a Professional Santa Rosa Property Manager
While there are a few good reasons to manage your own rental property, there is a long list of advantages to professional management.
The first question you have to ask yourself is this: do you consider yourself a landlord or a real estate investor? Landlords are generally more comfortable managing their own rentals. Real estate investors understand the value of professional management and they don’t want to waste time collecting rent, chasing down tenants who refuse to answer their phones, or arguing prices with plumbers.
It’s a good reason to hire a professional management company if you have multiple properties. It can become difficult to keep track of which units need what from you. It may be difficult to keep all of your rentals occupied and you might easily misjudge the amount of time it takes just to show your vacant property to prospective renters. Screening tenants can be a challenge, especially if you don’t have the resources to check national eviction databases or call up rental references.
Maybe it’s not just time, but a lack of resources. How do you know where to price your property? When should you begin discussing a lease renewal with your tenants?
If you just don’t have the time or interest to manage your rentals, then hiring a professional Santa Rosa property manager may be the right choice for you. A good property manager will handle all aspects of renting your property, including:
- Marketing and advertising as well as showings
- Tenant screening
- Lease agreements
- Collecting rent and enforcing the lease
- Maintenance
- Accounting
- Legal compliance
- Inspections and preventative maintenance
Your property manager can also handle any tenant issues that arise, so you don’t have to deal with the headache of late-night phone calls or emergency repairs. If there are disputes or conflicts, your management company will ensure they do not escalate. You and your investment property will be protected by experienced professionals who have done it all before.
One of the reasons that many rental property owners hesitate to hire a management company is because they don’t want to incur the cost of management fees or leasing fees. Here’s something you have to remember: those fees are tax deductible. They’re also not as high as you might think they are, especially when you consider the scope of work your property manager can provide.
If you’re an extremely hands-on landlord, allowing a property manager to step in and make decisions for you could also be a challenge. It might be difficult to accept, especially if you want to continue choosing tenants, pricing your own property, and determining where to invest in upgrades and improvements. If you’re not interested in leaning on the expert advice of others, you might find handing over your investment property to be too much.
Choosing the Right Option for Your Santa Rosa Rental Property
Ultimately, the decision to manage your rental property yourself or hire a professional property manager will depend on your personal goals, preferences, and resources. If you have the time and the skills to manage your rental property on your own, and you’re interested in staying up to date on the constantly changing laws and best practices, then you can save money by not hiring a professional.
However, if you value your time and don’t want to deal with the hassle and stress of managing your rentals, then hiring a property manager may be the better choice. You’ll also better protect yourself against legal mistakes and expensive errors that could land you in court or result in very high penalties and fees. Saving a couple hundred dollars a month on property management fees won’t mean much if you hire the wrong vendor and your property gets destroyed or you’re sued by a tenant for violating fair housing laws.
It’s important to consider the pros and cons of both options before making any decisions. You should also research property management companies and read reviews from other landlords to get a better understanding of how their services work and what kind of results they can deliver. If you decide to hire a property manager, you want to make sure you’re choosing the right management partner for you and your properties.
If you’d like to talk more about how options and how each one would look with your specific rental property or portfolio, get in touch. We can talk to you about how property management may add value, help you earn more and spend less, and lead to a better and more profitable rental experience for you and your residents.
Property management is not for everyone. However, we talk to a lot of owners who wish they had hired a professional partner sooner. Why over-complicate your life? Give up the landlord title and start thinking about yourself as a real estate investor. Smart investors are happy to lean on the experience of their management company. Not only are all leasing, management, and maintenance challenges met, there’s also an abundance of expertise and resources that can be leveraged to the benefit of your investment goals.
Please contact us at Prestige Real Estate & Property Management. We manage homes in Sonoma County, including Santa Rosa, Windsor, Sebastopol, Petaluma, and Rohnert Park.
