If you've recently decided to rent out your property, you may be curious about what that involves. Managing your own property often requires much more effort than many anticipate.
It’s common to think that managing a rental property can’t be too difficult, but the reality is that it can be a time-consuming responsibility, often resembling a part-time job. This can become burdensome, especially if you’re already juggling another career.
For those without prior property management experience, the task can feel overwhelming. Questions arise, such as: What do I need to know? How do I select the right tenant? How should I price my rental? These are essential considerations if you’re contemplating self-management.
At Andren Homes, we frequently encounter individuals who have attempted self-management or are unsure why they should hire a property management company. We believe that professional management can alleviate many of the challenges associated with self-managing. Below, we've compiled a list of common issues people face.
Key Challenges in Self-Managing
On Call 24/7
Limited Knowledge of Fair Housing and Local Laws
Tenant Selection Difficulties
Long Vacancy Periods
Juggling Multiple Properties
On Call 24/7
When managing your own rental, tenants can reach out to you anytime a problem arises. This could range from a minor issue like a torn window screen to a more serious matter like a burst pipe. You’ll need to either go to the property yourself or quickly find a vendor to handle the situation.
Without a list of trusted vendors, these minor emergencies can become significantly more complicated. Each time a new issue surfaces, you’ll have to spend time researching which company can best resolve it.
This constant demand for your attention can disrupt your daily life. You might receive an urgent call from a tenant while attending your child's soccer game or enjoying a movie, leading to frustration over these unexpected interruptions.
Additionally, you’ll be responsible for rent collection. This means you’ll need to ensure timely payment from your tenants on the first of every month. Managing multiple properties can make this task even more complex.
If a tenant is late with their payment, you must track this as well. Some tenants may consistently pay later than expected, necessitating careful monitoring to apply appropriate late fees.
Limited Knowledge of Fair Housing and Local Laws
Property managers usually possess an educational background that equips them with knowledge about real estate laws, fair housing regulations, and various local statutes affecting rentals. Most individual landlords do not have this level of expertise.
While it's possible to manage a property without taking a real estate course or passing a property management exam, navigating the myriad laws governing landlord-tenant relationships can be quite challenging.
For instance, choosing not to rent to college students due to concerns about potential damage is a violation of fair housing laws. The same applies to decisions made based on a tenant's family status.
California laws generally favor tenants, making it easy to unintentionally violate regulations. Doing so could expose you to lawsuits, fines, and ongoing issues with tenants.
Understanding these laws thoroughly would require significant time and effort, and even then, you may not feel fully prepared for every situation that arises.
Tenant Selection Difficulties
Selecting the right tenant is a critical task that can have both immediate and long-term implications. While renting to a friend or family member may seem like a good idea, it can lead to complications down the line.
A property management company handles tenant selection on your behalf, ensuring that personal preferences and biases don't influence the process, as discussed in the fair housing section.
When you personally choose a tenant, the decision can become more emotional than a straightforward business transaction. Although fostering a friendly relationship with tenants is pleasant, maintaining a professional distance is often easier and more beneficial in the long run.
Getting too close with tenants might lead them to request leniency on rent payments, pet policies, or guest restrictions, which can open the door to potential exploitation and loss of profit.
If the tenant happens to be a friend or family member, this task becomes even trickier, making it challenging to remain a fair and unbiased landlord.
Long Vacancy Periods
Another downside to self-managing rentals is handling marketing efforts. You’ll need high-quality photos of both the interior and exterior of the property, along with compelling descriptions for online listings.
Properties with subpar images on platforms like Zillow or Craigslist typically receive less interest and fewer showings than those with professional-quality photos. In today's fast-paced world, potential tenants have short attention spans and expect to be captivated by advertisements immediately.
If your marketing efforts are ineffective, your property may sit vacant for an extended period, leading to a decline in overall interest and necessitating a price reduction.
A home that remains vacant for 2-4 weeks without much interest will likely require a price adjustment. Prolonged vacancy periods are significant because you won’t be generating rental income during that time. Effective marketing from the start is crucial to securing a good tenant quickly.
Juggling Multiple Properties
For those who own or plan to own multiple rental properties, managing them all can become increasingly complex. Being on call for one property is challenging enough, but multiply that responsibility by two or three, and it can feel overwhelming.
Many individuals enter the rental business hoping to establish a profitable side hustle, generating income outside their primary job. However, attempting to self-manage multiple properties can consume too much time and distract from that goal.
Additionally, keeping track of finances across several properties can become a logistical nightmare. It’s crucial to stay organized to avoid losing track of who has paid rent, who is late, and who has yet to pay. Without proper organization, property accounting can turn into a significant headache.
Final Thoughts
These are important considerations to evaluate when deciding whether self-management is suitable for you. Many people believe they can handle it and appreciate having more control, but it often ends up being more time-consuming than anticipated.
If this article has prompted you to explore your property management options, check out our blog, Property Management vs. Self Management vs. Leasing Only: 5 Tips for Choosing.
Curious about property management costs? We can help with that too! Read our blog, How Much Does Property Management Cost?, for more insights.
Contact Andren Homes today to learn more about how we can assist with your property management needs! 📞 (831) 291-5043
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Logan Andren
Logan Andren is the founder and CEO of Andren Homes Property Management. Since launching the company, Logan and his dedicated team have simplified the rental property experience for numerous Santa Cruz homeowners. Their mission is to enhance the lives of their clients and community, focusing on providing exceptional service and fostering lasting relationships. DRE #02002055
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