Hiring a Property Manager vs. Managing Yourself (AIRBNB)

What’s up guys, it’s James here, let’s talk about managing your property as a short term rental specifically in this video, I want to talk to you about whether you should choose to manage the property yourself, or hire a property management company, I want to walk through some of the pros and cons of each and when I personally would hire a property management company, versus when I would manage the property myself. So let’s dig into it. Now, with a short term rental property, there’s quite a bit of nuance when it comes to actually managing the property, there’s a decent amount of work involved in running the day to day. And so whether you hire a property management company, or manage the property yourself, in my opinion, for the average investor, who’s looking to actually make money at this is doing it for a profit wanting to get a return. Even if you’re managing the property yourself, you should view it as managing the property yourself. What I mean by that is that you don’t actually want to be the one doing all of the individual components that make up management of a property. Yes, you’ll do it in house as opposed to outsourcing it to a property management company. But you want to think about a lot like kind of building your own internal management team or management structures, so that you’re not the one actually doing the legwork. Because as investors, if you’re investing in short term rental properties, the biggest kind of highest leverage activity for you and your business is not going to be organising a cleaner, it’s not going to be responding to guest messages, it’s going to really come down to maybe pricing your properties, but more than anything, looking for other great deals and expanding your investment portfolio. So you want to get yourself out of the day to day minutia as much as possible, whether you’re managing yourself or hiring a property management company. So with that said, let’s kind of dig into answering the big question, Should you do it yourself? Or should you hire a property management company? And my answer is, it depends. If you are looking to scale, if you’re looking to go to 510 15 properties very quickly, it’s going to be a lot easier to do that relying on a property management company, that’s a third party that is going to be building your own systems internally, if you’re starting out smaller, you’re buying one or two or three properties and growing relatively slowly, it’s gonna give you a lot more time a lot more leeway, it’s gonna make it a lot easier to build out those internal processes. Ultimately, though, if you are building larger, it’s also going to cost you a whole lot more to have a property management company, if you have five properties that are each doing $100,000 A year and growth boat gross bookings, you’re gonna be paying $20,000 or more per property in just management fees. So you’re going to easily be paying $100,000 a year in management fees on those five properties. And you better believe that you can get all the management done, if you were to build your own internal team for probably around 10, or 20, or $30,000 tops. So you’re definitely paying a big premium to go and work with an off the shelf kind of ready to go property management company. The benefit, though, is speed. The other benefit is it’s completely hands off. If you have your own internal systems and processes and you build out your own sort of internal team for managing properties, then ultimately, it’s going to mean that when something does break, or it needs fixing, or improving into you, that’s going to be doing it now that doesn’t equate to a whole lot of time on an ongoing basis. But it is probably more than managing it with a property management company, almost certainly so because the property manager in this case is going to be the one that would step in and fix or solve or do whatever is necessary. So for me, I find the property management companies are really great people that want to be one either completely hands off. So if you want to just have this be totally passive, then finding a property management company is the best way to achieve that. Or to people that just don’t have the time and bandwidth in order to build the their own internal systems. Yes, it’s going to come at a premium, you’re going to pay the price for finding a great property management company. But as long as you’re still making a really great return, well factoring that in, in my books, good to go. Now, for those of you who are not in that camp, meaning that you have the time and bandwidth to build your own internal systems and processes, you want to make a bit more margin on your investment, then managing it yourself or putting into place your own team in your own systems can be a really, really great way to go. It’s also going to allow you again to have a lot better margin as you scale, which is obviously really beneficial. Once you start saving 2030 $40,000 a year, it’s going to be pretty hard to go back on that. And so if you do decide to manage the property yourself, what you want to do is make sure you’re looking at it as a business. Don’t look at it as now you’re going to create yourself a second job and you’re just going to do all this stuff yourself. That will be just as silly as cleaning the property yourself. And I can imagine that most of you guys wouldn’t go down the route of trying to do that you would outsource it and find a cleaner. And so rather than looking at this as I’m going to do it myself look at it as I’m not going to hire a property management company, but I am going to build my own property management team. Now if you’re doing that you’re going to want to build up for example, The first role you’re going to find is going to be the cleaner. After that, you’ll probably want to find a maintenance person. Then next you want to find a guest communication person, that’s the person that’s going to just answer all the guests messages and take care of kind of responding to everything that needs to be responded to the last person you’re going to want to put in place. Guys just want to take a quick break here to say that for those of you watching, who want to build cashflow, and long term wealth by purchasing Airbnb ease and short term rental properties, there’s a link in the description right down below for a free training that will walk you through my exact strategy for investing successfully in Airbnb ease. Now, if you’re not ready to actually buy properties, and you want to get started managing other people’s properties on Airbnb the same way I got started and build a full time income managing other people’s properties, there’s actually another free training linked in the description down below as well, that’ll be a really great fit for you. So whether you want to invest in short term rental properties, and actually build amazing cash flow and long term wealth by acquiring the assets, buying the properties themselves, or you’re looking to earn a full time income, managing other people’s properties on Airbnb, we’ve got some awesome trainings that are linked in the description down below, it’ll definitely help you out. When you sign up for the trainings, we’re also gonna send you a few other tools and resources completely for free just to help you get started. Again, the links to sign up are in the description down below. And both trainings and all the tools are completely free. So make sure to register for the trainings, links in the description down below. The last version you’re gonna want to put in place, he’s what I call a portfolio manager, this is gonna be the guy kind of glue the person that holds the whole team together and make sure that the cleaning team communicates the maintenance that needs to be done, the maintenance person actually goes by there, that all gets communicated to the guests and around around the communication goes that portfolio manager is really going to be useful after about five properties that you have on your portfolio, because beyond that, managing all that triage work, I like to call it yourself is going to be pretty time consuming. And again, that’s just not a very high leverage thing for you to be working on as an investor. And so you want to get that off your plate. Now, the benefit of a structure like this is that it allows you once it’s built and set up properly, to be about as hands off as you would be with a property management company. Now, certainly it takes a lot more time and effort to set this up initially. But it does allow you to get to about the same end result as if you just hire a property management company. And then from there, you’re really reaping the rewards because like I said, if you do this properly, then you have now your own sort of internal property management company, that should be able to easily scale to 510 15 properties. And now it’s going to cost you a fraction of what it would if you’re paying a professional management company, it also then gives you a lot more control over your investment. Because with a traditional property management company for short term rentals, they’re not going to want you to take care of tinkering with pricing, because ultimately, they want to be the ones to do that. Because they probably know a whole lot better than you. And so again, if you’re the type person that wants to be completely hands off, that doesn’t want to have your hand and that sort of stuff, it’s actually going to be much more advantageous for you to hand it off to that property management company. Because they’ll probably do a way way better job than you would do pricing the property on your own. But if you’re like me and you liked this stuff, you want to spend time on it, you want to really great great at it, then in just a couple of minutes a week, you can add a few more $1,000 per month to your bottom line.

So having that kind of control of your investment that you don’t get with mutual funds, ETFs index funds, anything like that, to me is really, really powerful. When I look at my investment, it’s not just a black or white is the investment doing well, I can actually look and see what can I do to make this investment more profitable. For me, having that kind of control over my investing in my future, to me is a really, really big advantage. So if that’s something that’s attractive to you, then that’s another point in favour of managing the property yourself. But again, just got to make sure that you weigh that out with the burden of the responsibility of doing that. And there’s nothing worse than having the control to be able in the power to be able to do that and then just sitting on a nap not actually doing it. So those are some of my thoughts on the kind of high level, big picture pros and cons of hiring a property management company. Obviously, there’s quite a lot of nuance to it. And I think that in either case, it’s just super important that you do it the right way. If you hire a property management company, make sure you do your due diligence to find a really great property management company that’s going to achieve your goals with your investment. If you decide to do it internally do it yourself. Make sure you build that a really really solid team so that you’re not just creating a second job for yourself and making a whole bunch more busy work. Those are my thoughts I want to know your so let me know in the comment section down below. If you liked this video if you found it valuable or insightful in any way make sure you let me know by hitting the like button it really does just show me that you guys actually enjoy this content want to see more of it. So hit the like button if you enjoy this content and if you want to also stay up to date with the two new videos we post every single week here on the channel. Then make sure you hit that subscribe button as well so you can stay up to date with that all being said thank you so much for watching this video. was helpful and valuable to you and I’ll see you in the next one.