Self-Management or Professional Property Management?

When you're a real estate investor looking to grow your rental portfolio, a key question arises: at what point should you choose between managing your properties yourself or delegating that responsibility to professional property managers?

1. How many properties does the investor own?

   An investor with just a handful of properties can often manage them personally, as the responsibility is still manageable alongside their personal life. However, as their portfolio grows, the workload associated with active management can become increasingly demanding. A point may be reached where managing everything alone becomes difficult. At that stage, it may be wise to call on a specialized firm, like F.L. Management, to delegate all or part of the responsibilities.

   
   

2. What is the size of the properties under management?

   Managing duplexes or triplexes is generally less complex than overseeing a building with dozens of units. An investor might therefore feel the need to work with a property manager if their properties are large in scale. On the other hand, if they’re comfortable managing a few smaller buildings, like four duplexes, and it fits well into their lifestyle, they can certainly continue to manage everything themselves — or rely on a trustworthy tenant to help with day-to-day operations.

   
   

3. What is their interest and level of experience in property management?

   Managing a building involves several key tasks, such as finding and screening tenants, handling leases, collecting rent, dealing with repairs and maintenance, and communicating with tenants and service providers. These tasks are crucial to ensuring the profitability and longevity of a real estate investment. If an investor doesn’t want to take on these responsibilities — whether due to lack of time, having a primary job, or simply because property management isn’t their cup of tea — they can choose to delegate these tasks to a property manager. Moreover, the investor’s experience in these areas plays a critical role: limited expertise can hinder effective long-term management of the property.

   
   

4. What budget should be set aside for delegating property management?

   Before deciding to work with a property management company, the investor should carefully assess the costs associated with their services. Typically, these fees are calculated monthly based on the gross income generated by the property and range from 4–8%. While this represents a direct reduction in net income going into the investor’s pocket, it’s essential to consider the added value these professionals can bring. Through efficient management practices, they can potentially improve the property’s profitability over time by optimizing operating costs and reducing vacancy rates.

   
   

As an investor looking to grow your real estate portfolio, several factors need to be considered before delegating the management of your properties. Working with property management professionals can lighten your workload, enhance the profitability of your investments, and allow you to fully focus on growing your wealth — all with peace of mind.