As a self-managing landlord, you’ve likely experienced both the joys and challenges that come with overseeing your own investment properties. On one hand, the feeling of being in full control over your assets and maximising your returns is incredibly empowering. But on the other, you’ve probably encountered a few headaches that make you wonder if hiring a traditional property manager would be worth the cost.
The truth is, self-managing rental properties comes with its fair share of risks – but when done right, the rewards can be exponential. In this post, we’ll explore some of the key risks to be aware of, as well as the potential upsides that make self-management such an appealing option for savvy investors.
Risky business: Common pitfalls of self-managing
Let’s start by addressing the elephant in the room – the risks involved with self-managing your rentals. While being your own property manager certainly has its advantages, there are also some potential pitfalls to watch out for:
Tenant troubles: Finding reliable, responsible tenants is critical when you’re calling the shots. Vetting applicants thoroughly, enforcing rental policies, and swiftly addressing any issues that arise can be time-consuming. One troublesome tenant can quickly eat into your profits.
Maintenance mishaps: As the owner, the responsibility of property upkeep and repairs falls squarely on your shoulders. Arranging for timely maintenance, finding trustworthy contractors, and managing those costs can take some getting used to. Neglecting issues can lead to bigger (and more expensive) problems down the line.
Compliance concerns: Rental laws and regulations can be complex, especially when you own properties in multiple states. Staying on top of landlord-tenant legislation, fair housing rules, and tax requirements takes diligence. Missteps could result in hefty fines or legal battles.
Work-Life balance: Let’s face it – being a self-managing landlord requires a chunk of your time. Juggling your day job, family commitments, and the needs of your rental properties can potentially become overwhelming. Finding the right work-life balance is crucial to avoid burnout.
Communication Challenges: Maintaining clear, consistent communication with your tenants is essential. But coordinating move-ins/outs, property inspections, and resolving disputes can be draining, especially if you have a geographically dispersed portfolio.
The upsides: Why self-management is worth the effort
While the risks of self-managing are real, the potential rewards often outweigh the drawbacks – especially when you have the right tools and systems in place. Here’s why taking the DIY approach to property management can pay off handsomely:
Maximise your returns: When you self-manage, you get to pocket the fees you would have paid a traditional property manager – which can range from 8-12% of your monthly rental income. That’s a significant chunk of change that goes directly back into your pocket. (One of our customers, Erin Rutherford, can tell you exactly how much money she saves per year by cutting out the property manager. Read her full story here.)
Maintain full control: As the owner, you get to call the shots on everything from tenant selection and rent pricing to maintenance and renovations. This level of control allows you to optimise your investments according to your unique goals and preferences.
Develop deeper tenant bonds: By serving as the primary point of contact, you have the opportunity to build stronger relationships with your tenants. This can lead to higher tenant retention, better communication, and fewer issues over the long run.
Gain invaluable insights: Hands-on management gives you an intimate understanding of your properties’ performance, maintenance needs, and market conditions. This knowledge can inform smart, strategic decisions about your investment portfolio.
Boost your bottom line: Self-managing your rentals allows you to avoid the fees associated with traditional property management. When done right, this can translate to thousands of dollars in annual savings – money that can be reinvested to grow your real estate empire even further.
Putting the pieces together with an effective management platform
Of course, successfully self-managing your rental properties requires the right systems, tools, and know-how. That’s where a platform like RentingSmart comes in. Our powerful, user-friendly software is designed to streamline every aspect of DIY property management – from tracking rent and maintenance to communicating with tenants and generating reports.
With RentingSmart, you can:
Manage unlimited properties in one centralised dashboard.
Keep tabs on rent collection and send payment reminders
Maintain detailed records of repairs, expenses and tenant information
Coordinate seamless move-in/move out processes
Generate professional-looking reports for tax time
By consolidating all your property management tasks into one intuitive platform, RentingSmart empowers you to overcome the common risks of self-management. You’ll have the visibility, organisation, and efficiency you need to maximise the upsides – without the headaches.
The bottom line
Self-managing your rental properties is not for the faint of heart. It requires a significant investment of your time and energy, and comes with its fair share of risks. But for savvy, goal-driven landlords, the potential rewards far outweigh the drawbacks.
With the right mindset, processes, and tools in your corner, you can mitigate many of the common pitfalls of DIY property management. And the financial benefits – from boosting your bottom line to maintaining full control over your investments – can be truly life-changing.
So, are you ready to take the leap into self-management? Explore how RentingSmart can help you maximize the upsides while minimising the risks. Your portfolio, your tenants, and your bank account will thank you.
We’d love to answer your questions, so get in touch with RentingSmart today.
