The DIY culture is strong, and everyone loves the sense of accomplishment you feel when you learn something new or take control of a situation for which you once needed outside help.
Some things should not be done on your own, however. If you don’t know anything about cars, you probably should not change your own brakes. If you never studied medicine, you probably don’t want to heal a broken bone according to a DIY video.
Property management is best left to professionals as well.
It may seem easy enough to lease, manage, and maintain your own rental property, especially if you only have one or two homes that you’re renting out.
However, you shouldn’t DIY property management. There are a lot of mistakes that are easy to make. There are unexpected costs that will leave you will less rental income. And, the resources and knowledge you leverage when you partner with an expert property manager can help you have a better investment experience.
There’s no need to do it all on your own. Property management fees are tax deductible on your rental property. There’s less risk and more savings.
Here’s what we mean.
Risk and Liability with Florida Rental Properties
There’s always risk involved in any investment. Rental properties come with a lot of investment benefits, but there are inherent risks as well. After all, you’re renting a home to tenants. There’s bound to be some liability.
This is one of the best reasons to hire a professional property manager.
We have talked to property owners who weren’t sure how to enforce leases or lawfully evict tenants.
Are you requiring renter’s insurance?
Do you know the fair housing laws?
What about security deposits? Florida has specific requirements for how security deposits are held and returned.
The risk that DIY landlords face can be overwhelming. When a tenant stops paying rent, you risk losing a lot of income. If you don’t know the eviction laws, you’re also at risk of facing a long and expensive process of trying to remove the tenant from your home.
You can protect yourself and your investment with reliable, trustworthy property management. When you try to manage on your own, you could miss a lot of important details.
Here’s another example: do you know the difference between a pet, a service animal, and a companion animal? A lot of DIY landlords find themselves in court because they didn’t know the difference between property damage and wear and tear.
These things can get complicated quickly, and you don’t want to face the consequences of inaction or bad decisions. Eliminate a lot of risk by working with qualified and experienced property managers.
DIY Landlords Often Lose Money
How long is your average vacancy?
If your property is vacant for weeks and months, you’re losing a lot of money. Why is it vacant? Perhaps the price is wrong or you’re not marketing in the right places. Maybe you can’t seem to schedule showings with prospective tenants.
Property managers keep vacancy rates low. We have strategic marketing plans and we can easily access good data to accurately and competitively price your rental property. Sometimes, vacancies become so expensive so quickly that landlords become desperate to get a tenant placed. That leads to shoddy screening and unqualified renters. You’ll lose money on bad tenants because of:
- Late or unpaid rent.
- Lease violations.
- Property damage.
- Lease breaks.
Property managers know what to look for in a tenant, and they know what to avoid. You won’t have to worry about placing a bad tenant who won’t pay rent or follow your lease terms. You won’t have to worry about long and expensive vacancy periods.
Leasing a vacant property is not only expensive because you don’t have rent coming in. It also takes a lot of your time as a DIY landlord, and we can all agree that time is money. There’s the research you have to do, the preparation that your property will need before it’s listed, and the responses you’ll need to provide to people who contact you with questions.
Then, you have to manage the application process and screen all applicants in accordance with fair housing laws. There’s the lease agreement and the security deposit.
Unexpected Maintenance Costs for DIY Owners
Maintenance costs are rising for rental property owners all over the country, and our market is not immune. The cost of labor, materials, and supplies has risen with everything else. You might experience a shock when you call a plumber or a roofer or an HVAC technician to respond to a repair need at your rental property. The higher prices make it tempting to ignore a small repair issue rather than invest in fixing it.
Self-management will almost always be more expensive when it comes to maintenance and repairs. Professional property managers have more buying power. We provide vendors and contractors with a large volume of work and in turn, they give us their best rates and deepest discounts.
This does not mean that we can prevent higher costs. It does mean, however, that we can negotiate better rates. It means we can control the costs that often plague DIY landlords and owners.
Property managers are also likely to invest in preventative maintenance. Instead of waiting for your water heater to erupt, we’ll inspect it annually. Service contracts can be put in place for HVAC systems, roofs, and landscaping. We can prepare your home for hurricane season and make sure your investment property is as safe as possible during storms.
Many of the self-managing landlords we speak with report spending far more on maintenance than they expect. If you have an unexpected emergency, those costs are likely to set you back even further. Every rental home will need maintenance from time to time. If you’re working with a property management partner, however, managing those maintenance needs will be less frustrating and less expensive.
Accessing Property Management Systems and Technology
It’s not just that you’re putting yourself at risk and losing money when you decide to do your own property management.
There’s also a large opportunity cost.
Property managers have systems and procedures in place for everything, including:
- Leasing your home.
- Screening your tenants.
- Move-in and move-out inspections.
- Routine, emergency, and preventative maintenance.
- Rent collection.
- Lease enforcement.
- Accounting and financial reports.
- Tenant communication.
- Security deposit collection and return.
- Vendor management.
Setting up your own systems will be time consuming. You may not be consistent, and you may not have the tools and resources that are necessary to effectively manage minor tasks. You need a lease that’s legally compliant in the state of Florida. You need to know when to begin the renewal process.
Property managers have all of this in place already.
There’s also the matter of technology. Accessing the best property management technology as a DIY landlord isn’t easy. It’s expensive. It’s not always user-friendly. How do you even know what to use to collect rent payments electronically and document property conditions?
When you work with a property management partner, you can access the technology that’s already in place. We invest in the most innovative platforms and systems available. Our technology allows us to seamlessly:
- Collect rent online from tenants. This results in fewer late payments, and tenants prefer our convenient and secure online system.
- Pay your rent via ACH direct deposit. No need to wait for checks in the mail. You get your rent faster.
- Collect routine maintenance requests electronically, giving us a documented history of repairs that were needed and performed at your property.
- Offer tenant and owner portals for communication, information, and resources.
- Syndicate listings across a large number of platforms during the marketing process.
- Provide financial reports and accounting statements in real time.
- Generate lease renewals and other correspondence automatically.
Technology leads to more transparency, more accountability, and a more efficient rental experience for both tenants and owners. While a DIY landlord can introduce technology here and there while managing a property, getting a comprehensive management system in place is difficult and often cost-prohibitive.
It seems like managing your own rental property will be easy and cheaper than hiring a property manager, but that’s often not the case. In addition to all the services you receive when you work with a management partner, you also get decades of knowledge and experience. That’s a lot of value. When you’re looking for new investment opportunities, thinking about selling, or wondering whether it’s time to consider vacation rentals, you’ll have an expert you can lean on for advice and guidance.
We love working with landlords and investors at every level of their real estate career. Whether you’re renting out one home or you’re growing an entire portfolio, there’s a lot that a property manager can do for you. Leave the frustrations and the mistakes of self-management behind you and invest in a better rental experience.
Let’s talk about how we can help you earn more and spend less while having a better experience overall. Contact us at Anchor Down Real Estate & Rentals.