Determining Your Property Management Strategy Part 2: Skill and Available Time
To effectively determine the best property management strategy, you must be honest with yourself about your strengths and weaknesses, including skill level, and available time. The following is a list of skills that may be necessary to succeed.
- Organization: Owning a rental property is the same as owning a business. To successfully manage a business, you need a large amount of organization. For instance, you need to know rent collection dates, when bills and property taxes are due, lease expiration dates, when inspections will happen at the property when garbage and recycling are picked up and even when to switch the batteries in the smoke detectors. If you are all over the place, and can’t get organized, a licensed property management company may be the best fit for you.
- Business: If you are not the savviest businessperson, there are two different approaches you can take. If you want you can go get help, or you can just learn as you go. As a property investor, you should absolutely have a business plan in place, a strategy for handling everyday operations and the crucial exit strategy if you must get out of the property investment business.
- Maintenance: Ask yourself honestly: how handy are you? Even if you are handy, are you comfortable fixing any big maintenance issues at your rental property or would you rather hire a professional individual to deal with the issues in question?
Anticipated Time Commitment
Is your goal to be a landlord or to be a rental property owner? If you are working a full-time job 40-hours a week, it could be very tough to manage a rental property full-time as well. The truth is that either investment strategy is fine if you have determined what your goals are. If you like the idea of not personally managing the property, more like investing in the stock market, then a third-party property management company may be the best for you. If you like the thought of active management, communicating with tenants and gathering the monthly rent, then you will likely prefer a more hands-on approach.
Owning rental property can be a great investment for many types of people. But that doesn’t mean actively managing the property is not the best fit for all. You may be awesome at dealing with maintenance issues but may have a shorter fuse when the actual tenant is grouchy about the maintenance issue itself. It may be wise to consider the following questions:
Are you good at dealing with stress? Are you able to cope with unanticipated problems? Can you multitask different things at once? Problems will arise, and they always seem to pop up when you are on vacation or during a weekend. Can you deal with this kind of stress or would you rather have a property manager deal with it for you? The answers to these questions will shed a great deal of light on whether you are best handling things alone, or if you will require assistance.