Purchasing an investment property is an exciting business venture for any person, finding a good deal and building connections with people who have a similar strategy gives you confidence when investing in your first property.
However, not many people consider who will actaully be managing this property, at the beginning it may seem like a good idea to manage your own property by yourself and retain full control over costs, tenants and rental income but this can quickly become tedious and you could be crying out for a specialist after just a few weeks.
Below I’ve listed the main reason why you may opted into hiring a property management company:
If You Don’t Have Time To Learn The Laws And Run It As A Business
Each council in the UK have different laws and legislation that local property investors need be aware of. Many investors may have properties they dont live in and needto make sure their property is following the council guidelines. Property managers job is to constantly keep up with changing laws and can save investors from legal liabilities. Without a property manager you’ll also fall into tenant trouble, as they may need a property manager around to answer any legal questions they have abut their contracts.
2. If Your Properties Are Located In Different Markets
Living in one city and investing in another can prove difficult when it comes to property management. This may limit the investors time and skill when it comes to meeting the needs of their tenants and of the property itself. Whilst managing yourself may save you the investor 10%-15% it will mean that you will sacrifice a lot of your own time. So ultimately I guess this comes down to a personal decision
3. If You Want To Maximise Your Time As A Passive Investor
In order to go from managing 1-3 to 8-15 investment properties an investor will at one point need to hire some help. This will give you the investor time to scale your invetsment business and give you time concentrate on growth rather than management. I believe once you get to 3-5+ properties its time time to hire a property management company.
4. If Property Investing Is Your Side Hustle
If property investing is your side hustle I would again suggest hiring a property management company. You won’t be able to pay them loads but they can handle minor issue such as rent collection, minor repairs etc.
5. If You Lack Housing Expertise
For many people the first property they invest in they want to manage but managing a property correctly takes some experience and skill. Especially when it comes to managing tenants. Your time may be better spent looking at new opportunities to make money and so hiring a property manager could be the best solution.