Is Self-Managing Right For You?
We all know the saying “time is money,” and time spent working on investment properties is a perfect encapsulation of this statement. Investors who hire property managers are more likely than those who self-manage to know exactly how much time is costing them. Self-managing investment properties is a way to optimize profit, but investors need to know their limits and recognize the true value of their time—underestimating this personal cost does no one any favors.
Routine Maintenance
A large time suck for self-managers comes from routine maintenance that can be difficult to delegate. Reliable snow removal services, for example, are often very expensive. Many self-managers do this work themselves to avoid the high fees, but this often means waking up at the crack of dawn to perform difficult physical labor in the bitter cold of winter. Managing these humdrum tasks, along with repairs and general upkeep is a major reason that investors decide to sell.
Filling Leases And Vacancies
No owner is happy having units sit empty for long, but it takes time and effort to fill vacancies. The timing of tenant leases makes a big difference for potential buyers. Here are a few larger considerations to keep in mind:
Fully (or mostly) leased buildings appeal to investors, but only if rents are near market value and tenants have been consistently paying their rent.
Most conventional and FHA/VA financing is only available when there is an available vacancy within 90 days of closing.
Tenants still have the right to 48-hour notice before showings and may be prone to complain about strangers walking through their units.
Resigning tenant leases before listing can put your property at a disadvantage, especially when there is significant deferred maintenance for a potential new owner to consider.
If you have tenants ending their lease, that could be an ideal time to list your building. Even one easily available unit to show prospective buyers can simplify the listing process for you and your tenants. This turns an empty unit into an investment in your sale, so serious buyers can see the building without 48-hour notice, potentially making your time on the market shorter.
Ultimately, investors must weigh their responsibilities against their bottom line. Self-managing one or two properties, while maintaining a separate full-time job, is the reality for many. Addressing tenant and building issues promptly definitely becomes more difficult the larger a portfolio grows, and wise investors know the true value of their own time.
