Self-managing a rental property can be an appealing option for many property owners. By managing the property yourself, you can save money on management fees and maintain more control over the day-to-day operations of your investment. However, self-management also has its drawbacks, including a significant time commitment and increased legal and financial risks. In this article, we’ll explore the pros and cons of self-managing your rental property, to help you make an informed decision about the best way to manage your investment.
Pros of self-managing your rental property:
Cost savings – One of the most significant advantages of self-managing a rental property is the cost savings. By managing the property yourself, you can save money on management fees and other costs associated with hiring a property management company. These savings can be particularly significant for smaller properties with a low rental income.
More control – Another advantage of self-managing a rental property is that you have more control over the day-to-day operations of your investment. You get to choose tenants, set rent prices, and handle maintenance and repairs. This can be particularly appealing for property owners who are detail-oriented and want to be involved in every aspect of their investment.
Better understanding of the property – By managing the property yourself, you’ll gain a better understanding of its strengths and weaknesses. This can help you make more informed decisions about how to manage it effectively, including identifying areas for improvement and investing in upgrades that will increase the property’s value.
Cons of self-managing your rental property:
Time commitment – One of the most significant drawbacks of self-managing a rental property is the time commitment. Managing a rental property is a significant responsibility that requires a lot of time and effort. You’ll need to screen tenants, handle maintenance and repairs, and deal with tenant complaints and emergencies. If you have a full-time job or other commitments, you may find it difficult to manage a rental property effectively.
Lack of expertise – If you don’t have experience managing rental properties, you may not have the knowledge and skills necessary to handle all aspects of property management effectively. For example, you may not know how to screen tenants properly or how to handle difficult tenant situations. This lack of expertise can lead to mistakes and ultimately cost you time and money.
Legal and financial risks – This is a BIG one! Without professional help, you may be more vulnerable to legal and financial risks. For example, if you don’t follow the proper eviction procedures or fail to maintain the property adequately, you may be at risk of tenant lawsuits, property damage, and missed rental income. These risks can be particularly significant if you’re managing a large or complex property.
In conclusion, self-managing a rental property has both pros and cons, but the cons are pretty serious. While it can be a great way to save money and maintain more control over your investment, it also requires a significant time commitment and increases your legal and financial risks. Before deciding whether to self-manage your rental property, consider your personal circumstances and preferences, and weigh the advantages and disadvantages of self-management carefully.
If you’re unsure whether self-management is right for you, consider speaking with the professionals at Reed Property Management. Just give us a call at (239) 351-2880 or contact us via our website or email.