Being a hands-on landlord is hardly glamorous, and at times it can be tedious, and a lot less profitable than many make it out to be—especially when you factor in your time.
There are definitely many benefits to owning real estate and investing in income-producing rental property. There can be great cash flow, high returns, equity appreciation, pride of ownership, and protection against inflation, and yet being a self-managing landlord can also be a nightmare. Here are five reasons why being your own landlord could cost you more than you make.
1. Time Commitment
If you are going to self-manage your own rental property portfolio, you can go ahead and kiss your time goodbye. Forget occasionally going on vacation, taking the weekends off, booking dates that you can stick to, or getting plenty of sleep. Be ready for the phone to ring with incoming tenant and prospective-renter inquiries. You will have to be on call 24/7/365.
2. Many Roles to Master
Being a property manager involves mastering a whole team of full-time roles, including customer service representative, marketer, designer, copywriter, leasing agent, tenant screening professional, bookkeeper, handyman, property inspector, and property manager.
3. Mental Drain
Being busy is one thing. Though in this job, you will also have to deal with a lot of stress. Regardless of how good your properties are or how nice of a landlord you are, you will eventually have tenants who are very demanding, or will bring their drama with them. Everyone has a story for why they can’t pay the rent—and it can be draining.
When you are selecting investments, supervising a home rehabilitation or improvements, accepting tenants, and managing your properties, emotions can come into play. When you allow your emotions to influence your decisions to buy, lease, renovate, manage, and sell, you risk your financial results. It’s often better to just stick to looking at the numbers, without even seeing the property. One thing to avoid at all cost is being emotionally attached to a property, as it can severely cloud your judgment.
From the physical dangers of being on job sites and dealing with tenants, to collecting rents and dealing with angry tenants and dogs, to the financial liability involved in being too close to it all, signing on as a DIY landlord is risky.
Fortunately, there are ways to get all the benefits of investing in rental properties without having to be the on-call landlord yourself. Outsourcing the management of your property to a professional management company can relieve you of the burden of property management while maintaining the benefits. Choosing a professional team to handle the day-to-day needs of the property and tenants can result in a more profitable business model, more free time, and less stress. To learn more about outsourcing your landlord duties to a professional team of property management experts, go to SellstateAlliance.com or contact Sharon Black at 719-377-8600.