There really isn't much stress to it. Most stress I hear people experiencing is due to overleveraging their properties, thinking rents never go down, or not understanding where rental rates are at.
I found the stress was over things I can't control like the economy. Finding the right tenant starts with understanding you are in the housing business and the quality of your housing is the quality of your tenant. Next, comes price discovery. This is all about solid research of what exists in the market today. The goal is finding the balance of a fair rental price with a good tenant that leads to a long term relationship in a home they love. A good tenant will value the same things I do, so what is there to really stress about? Education is important especially around sitting water and home ventilation. 99% of people are totally reasonable and want to live peacefully.
Stress over finding the right tenant is usually lack of market knowledge. Go on Kijiji and make a simple Excel database of every single comparable property. Go back a week later and look at the change in prices, ads that have been removed (assume rented), any change in incentives. Now you have an idea about absorption. Now you can price. Easy.
My proxy is that I should get 3 - 4 qualified leads every week or I am out of touch with the market. No stress involved. If you are stressing, you are not doing things right.
I found the stress was over things I can't control like the economy. Finding the right tenant starts with understanding you are in the housing business and the quality of your housing is the quality of your tenant. Next, comes price discovery. This is all about solid research of what exists in the market today. The goal is finding the balance of a fair rental price with a good tenant that leads to a long term relationship in a home they love. A good tenant will value the same things I do, so what is there to really stress about? Education is important especially around sitting water and home ventilation. 99% of people are totally reasonable and want to live peacefully.
Stress over finding the right tenant is usually lack of market knowledge. Go on Kijiji and make a simple Excel database of every single comparable property. Go back a week later and look at the change in prices, ads that have been removed (assume rented), any change in incentives. Now you have an idea about absorption. Now you can price. Easy.
My proxy is that I should get 3 - 4 qualified leads every week or I am out of touch with the market. No stress involved. If you are stressing, you are not doing things right.
Similar to the above. In Calgary, our gross rents are down by about 15% from 2 years ago. Having properties which are nice enough to stick out from the crowd, and, are priced accordingly will get you tenants. Tenants feel very much in control and you have to know they are looking at a number of properties before choosing yours. They read the papers and some feel that prices and deals are better than what you are offering. Be realistically clear on what your property is worth. We do a comparable spreadsheet, drive by other listed properties, talk to viewing tenants about the properties they've viewed, and sometimes book a viewing of other rentals which are similar to ours. That way, when, when a tenant or prospective tenant says your property is only worth xxx, we know whether to hold out or perhaps adjust our pricing. Marketing in as many ways and places helps too. Yes, it is more work, and can be frustrating. Two and a half years ago, people lined up to view and rent. The shoe is on the other foot now.
To avoid that, we used to ask the prospective tenant to call us one hour before the viewing to confirm. We tell them if we don't hear from them, then I'll assume they're not coming and I won't be there. Now, with a slower market, we call them an hour or so before the meeting, or text them to confirm the meeting. If they don't confirm, (they mostly do confirm) then I text them again and say we won't be at the viewing. Works well.
I could foresee this backfiring on you. Suppose you call or text the prospective tenant while they are at work and the nature of their job does not permit them to receive personal calls while on the clock. They go off shift, check their phone and see your request for confirmation followed by a cancellation. If I were a tenant in a slow rental market I would consider that a good enough reason to take my business elsewhere.
Well stress is just a function of tolerance , or the what you are willing to pay. So if PM is your solution to rental stress, what are you willing to pay as a % of gross rent? 8%, 10%, 20%.
PM is a source of the great frustration at 8%, I think. I don't really want to pay 15%. Maybe 10-12% is doable, but this is just basic PM work.
Examples:
PM comes to turn back on a breaker ---> 75-100 dollars.
PM doesn't feel comfortable around the panel --> electrician charges 100-150 for emergency work.
A faucet need tightening (both tenants and PM are too stupid to figure out something needs to be tighened)...Emergency plumber is called in at 250/trip.
Things like that are annoying.
PM is a source of the great frustration at 8%, I think. I don't really want to pay 15%. Maybe 10-12% is doable, but this is just basic PM work.
Examples:
PM comes to turn back on a breaker ---> 75-100 dollars.
PM doesn't feel comfortable around the panel --> electrician charges 100-150 for emergency work.
A faucet need tightening (both tenants and PM are too stupid to figure out something needs to be tighened)...Emergency plumber is called in at 250/trip.
Things like that are annoying.
As a real estate investor you should focus on two things: find great assets to buy and improve, and secondly find money partners ( assuming you wish to grow and not only invest your own cash). Anything else should be delegate ie legal, accounting, painting, weed removal, faucet fixing, credit checks, tenant selection, eviction etc ( the sum of which is usually referred to as property management )
The only reason to do your own PM work is
A) to learn it so you can appreciate their work and why 10-12% is good value
B) you have ample time ( say you are retired )
C) you love it and have ample time
The only reason to do your own PM work is
A) to learn it so you can appreciate their work and why 10-12% is good value
B) you have ample time ( say you are retired )
C) you love it and have ample time