Should you self-manage or hire a property management company for your Dallas rental property investment?
Each choice carries its own set of advantages and disadvantages. Let’s explore the respective pros and cons of self-managing and hiring a property management team for your Dallas property.
PROS:
No property management expenses
This is, by far, the best reason to self-manage your Dallas property: you save on property management fees. Some property management firms have associated costs when you hire them. There are many fees you can avoid by managing your own rental unit:
- Initial setup fee
- Monthly management fee
- Tenant placement fee
- Vacancy fee
- Maintenance fee
- Eviction fee
- Early termination fee
The type and cost of fees depend on the property management company you hire. Anywhere you save on fees is money that can be spent on your Dallas property’s upkeep.
Full control
When you manage your property, you get to make all the decisions. You are in charge of the type of marketing to be done, you can pick the type of tenants you want to attract, and you will handle the maintenance of your Dallas property. You’re responsible for focusing on achieving your own business objectives.
Learning ground and experience
There is no substitute for self-learning. Managing your own Dallas rental property will expose you to the details of the business.
You will experience first-hand the situations that come up when owning a rental property. Theory will never replace real-life exposure to the real estate industry.
Tax benefits
There are several expenses in your Dallas rental property that you can list as tax deductions. Various costs connected to property improvement, necessary maintenance and repair, and depreciation are some applicable expenses. You can also include your mortgage interest and insurance expenses in your tax documentation. It is advisable to consult tax professionals in this matter to help you recognize your tax benefits.
Closer relationship with tenants
As a landlord self-managing your Dallas property, you get to interact closely with your tenants. If they have issues and concerns, they will contact you directly. There will be a more hands-on approach to finding resolutions in this scenario.
Compared with having a third-party (like a property management company) acting on your behalf, you get to know your tenants well. This allows you to determine the needs of your tenants and do your best to meet or exceed their expectations.
Priority
Unlike a property management firm that manages several properties, you are certain your property is a priority. When you’re self-managing, you are ensured that care, attention, and time is fully dedicated to your property.
CONS:
Difficult tenants
Being in charge of finding your own tenants could backfire. You might not have a good tenant screening process in place for renting out your Dallas property. If you are inexperienced, you might rent out your property to someone who pays late, creates nuisances, or doesn’t take care of your property very well.
Property management companies have professional experience in conducting thorough screenings of tenants. They have the resources and efficient methods to conduct background checks and verify submitted information.
Landlord role
Self-managing your Dallas property can be stressful. You might be uncomfortable with changing your policies, raising your rent price, and collecting late penalty fees. As a landlord, you need to create boundaries and conduct yourself in a professional manner. This could become challenging at times when you are building a good relationship with your tenants.
If you hire a property management company, they will be competent in performing the stressful functions that are required from a landlord.
Upkeep
The costs of upkeep in your Dallas rental property can be overwhelming. You will need to hire independent contractors to conduct repairs, whereas property management firms have the necessary resources and workforce to do deal with those situations more efficiently.
They have built a network of partnerships with professional handymen for necessary repairs and maintenance. As a result, they can offer this service at a lesser cost, thus generating more savings for you.
Expensive mistakes
Managing your own Dallas rental property can be expensive, especially if you lack the experience and expertise. You will be learning a lot through experimenting on your own. Further, there may be incidences that could lead to large expenses. Some situations can be avoided if you hire a property management firm who can offer full support to your business. They also have the appropriate solutions to most situations, leaving you stress-free.
Enforcing policies on your own
As a landlord self-managing your Dallas property, it is up to you to ensure tenants are complying with your rental policies.
When you hire a rental property manager, they can manage the following for you:
- Collect the rent promptly
- Deal with conflicts
- Handle eviction issues
- Conduct regular inspections
- Implement late payment penalties
Time-consuming
Handling your Dallas rental property on your own can use up all your time and energy. You are on call most of the time, especially during emergency situations. You are expected to deal with all your tenants’ issues and concerns promptly.
If you have numerous properties and tenants, this can be very time-consuming. Furthermore, you might sacrifice other important responsibilities, resulting in inefficiency. A property management company is capable of running your properties effortlessly, ensuring you have time for other activities.
The Bottom Line
In the end, there are advantages and disadvantages to both options. You need to carefully evaluate which best fits your needs. If time, freedom, and fewer expenses down the line are best for you, you should consider hiring a property management company. For inexperienced investors, you might also want your Dallas rental property to be managed by a professional property management firm. Their expertise and knowledge will give your rental business a greater possibility of success.
