For a buy & hold investments to make sense financially it will more than likely need to be owner operated. Property management companies often do not get involve with small scale multifamily properties unless they are given a minimum of 6.0% and up to a 10.0% fee of total collected income. Therefore, in effort to open up the number of properties that fit their acquisition criteria small scale landlords decide to self-manage. However, it will quickly eat up a lot of time if not managed correct. The three pieces of property management (Leasing, Collection, Repairs) need to be handled in a way that minimizes monthly time commitments while still delivering an acceptable service to existing and prospective tenants.
Leasing - The easiest and most effective way to quickly find prospects for a vacant apartment is to put a sign in the window and post the property on Zillow (automatically uploads to HotPads and Trulia). DO NOT put your personal phone number. Create a Google voice number for all signs and Zillow listings – only you actual tenants should have access to your personal cell phone number. Advise in your listings and your sign to TEXT the phone number along with their name. Check this phone number’s messages three times per day and advise each prospect the two 1-hour time windows per week in which you will be holding open houses. Do not setup individual tours for each prospect. Many are not actually in the market to rent or will not like your specific space so it is important to get as many people into each appointment so as to minimize the number of times you need to show the space.
Collection - Provide a 1-hour time window each month to all your tenants in the same building in which you plan to pickup rent from. If they are unavailable at the time of pickup, ask them to leave the check in the mailbox. If they are a cash paying tenant and the proposed time does not work, then schedule your pickup time around the cash paying tenant in effort to make only one stop per property per month for collection needs.
Repairs - Hire an exterminator to do an investigation and have them include a 1-year guarantee of no pests. This will fix your cost and you will be able to have them come back for any roach/rat problem going forward for the rest of the year. Provide their number directly to the tenants so they do not have to go through you to get this problem resolved without you ever needing to get involved. For any other repairs have the tenant send you a photo of the issue and where it is. Send this and the information to your handyman and have him go over there anytime, and more importantly install a lockbox on the property so the handyman can access it at anytime without you needing to provide access or coordinate access with the tenant themselves.
Using these techniques will allow you to manage more units with less of your time and more importantly you will be able to bypass a property management company for a longer time period as you scale upward. . Contact us to find out how we can help you.