(Can I call myself a landlord if I cheat and use a property manager to do all the work? :))
Well that was a fast month, wasn’t it? One second we’re moving into our mother-in-law’s, and the next we’re out in a new state and allowing strangers to live in our old house! Haha… albeit strangers who agree to pay down the mortgage for you, which is nice ;)
“And now the REAL trouble begins…”
Which I thought seemed appropriate considering all the horror stories people like to tell you when you’re jumping into this stuff :) And while we haven’t had too many problems quite yet (knock on wood), we have run into some not-so-fun ones already… One being our fault, and the other theirs:
- Our brand new sink and dishwasher wasn’t installed correctly ($150). Which meant every time our new tenant turned on the sink to get some water or wash something, it would all drain into our dishwasher filling it up with the remaining dirty water. Making both appliances useless unless you wanted to flood the place (which luckily didn’t happen!). Though I wouldn’t blame our tenants for *wanting* to do so considering it took us 5 days to fix the whole mess :( We had some logistical problems with our installers and had to end up using the property manager’s go-to company which of course charges an arm and a leg. But when your tenants aren’t happy, you’ve got to resolve the situation as fast as possible so we did what we had to do. The overall bill came out to a little over $350, but I got our installers to at least front $200 of it since it was of course 100% their fault. The whole thing should have been avoided from the beginning…
- Our renters messed up some landscape while moving in ($300). NOT ours, thank goodness, but a part of the communal area of our neighborhood apparently. Which is really weird cuz a) there’s not much to mess up really, and b) no one at our home owner’s association EVER cares about stuff like that. So someone would have had to not only witness such things happening, but then *taken pictures* of it AND ratted them out. Which according to our property manager happened because they DO have pictures with evidence! Jeez… so our homeowner’s sent them a notice about it to pay up, and we’re assuming all went well because it’s been a few weeks since we’ve heard anything else. Worst case there’s a chance we’ll be on the hook for it, but crossing our fingers that won’t happen…
So yeah, not the smoothest of starts I’m afraid. But if that’s the worst that happens all year we’ll be happy campers :) We’ve been incident-free for the last three weeks, at least! Haha…
On the plus side, I can’t tell you how much of a weight has been lifted off our shoulders! I knew the process could get stressful, but man – when you’re in it your emotions go haywire! Especially when you’ve got a billion other big things all happening at the same time too. It’s definitely not for the faint of heart, I’ll tell you that much. I’m just so glad it’s all over with for now, and praying these guys stay in there for a long and prosperous 10 years ;)
All a part of the game though, eh? Oh. And for those who have asked me lately on how property managers work, and how much they cost, here’s a quick rundown (at least on how *ours* works):
How property managers work, and how much they cost
First, if you want them to do the legwork to get you a renter in the house, they will do so for the hefty sum of 1 month’s worth of rent. But when they say they do everything, they really do everything: advertise the place, show the place, prepare and review all legal documents (applications, leases), run background/credit checks, contact references, collect money, and anything else that’s needed to get someone in the door. All you literally have to do as the home owner is choose the person you want to live in there (they’ll give you guidance along the way too), and that’s it. Outside of filling out your own paperwork to employ the property manager to help you too, of course.
Then, if you want the property manager to continue watching the place and doing all the necessary work (collecting rent, handling problems, etc etc), they’ll do that for a % of the monthly rent. In our case, it’s 8% of rent. Though when doing research I saw places charge anywhere from 6-12% so I guess it just depends on the company, and maybe what they offer for that %.
So yeah – not cheap. But definitely worth the peace of mind if you don’t feel like dealing with any of it (or if you’re too far away to deal with any of it). It’s nice having someone else be the go-to person when something breaks in the house for once :) It’s a dreaded call to get for sure, but I’m much better at giving my approval on something than I am working out the details to get ‘er done.
Hope your guys’ rental adventures are going okay over there! I know some of y’all have your own little real estate empires you’re building out which I greatly admire :) I’m not sure I have what it takes to go All In quite yet, but we shall see what the future brings… One step at a time, right?
[Photo by Collin Anderson]
Jay loves talking about money, collecting coins, blasting hip-hop, and hanging out with his three beautiful boys. You can check out all of his online projects at jmoney.biz. Thanks for reading the blog!