Rent out a condo?

Go2Irvine

New member
We are thinking to rent out our condo and are wondering what option is better manage it ourselves or using a property management. Also, any idea how much are you paying a realtor to list your property and how much property management typically would charge? Any insight is appreciated!
 
You should contact the member IrvineRealtor here... he does both rental listings and property management.

After being a landlord for a few years, I would probably go with the property management, the expense is probably easier to handle than the headache (and time).
 
You will typically pay a commission of 5-6% of the annual rental amount to list it through a realtor (typically 1/2 of that goes to the listing agent and the other half goes to the tenant's agent).  You can also list the condo for rent on craigslist for free (I've done that with a few of my rentals).  A property management company will change anywhere from 6-10% of the gross rental amount to manage the property for you.  Renting an attached condo where the HOA takes care of a lot of things for you makes it easier to manage.  A good tenant is worth their weight in gold and makes having a rental property very painless. 
 
USCTrojanCPA said:
A property management company will change anywhere from 6-10% of the gross rental amount to manage the property for you. 

I noticed a couple property management companies I checked out keep attorneys on retainer which is convenient should the owner need to deal with something like eviction. Do you know if most or all other companies do the same?

Go2Irvine, just my opinion but that's one of the things I'd look for in property management.
 
Go2Irvine said:
We are thinking to rent out our condo and are wondering what option is better manage it ourselves or using a property management. Also, any idea how much are you paying a realtor to list your property and how much property management typically would charge? Any insight is appreciated!

I have been a landlord for 12 years. I would recommend a property manager so you won't have to deal with the tenant.

If you need a recommendation let me know.
 
USCTrojanCPA said:
A good tenant is worth their weight in gold and makes having a rental property very painless.

Bingo!  The top lesson a new landlord should understand is to SCREEN YOUR TENANTS WELL.  I was fortunate to receive this advice from relatives prior to becoming a landlord myself.  I've been managing my condo rental myself for 2 1/2 years and it's been pretty painless because I found excellent tenants. 

Most of the work is up front, getting the unit rented using Craigslist and $8 "For Rent" signs from Home Depot.  You also have to answer your phone and show the unit a few times.  After that, there's not much to do so a property manager doesn't add much value.  Why pay somebody $100-200 per month to cash a check for you?

If you plan to self-manage then you need gameplan for handling repairs.  Last year, I had to replace a dishwasher that stopped working due to old age and also a leaky kitchen faucet.  I handled both issues myself, installing a dishwasher with no prior experience, and replacing the faucet with the help of a relative that had the proper tools and experience.  My reason for doing both jobs myself was to save money and because I enjoy learning and using my hands.  If you don't want to handle repairs yourself, then it's easy to pay a professional to do the work.  Hiring a professional when things break occasionally is still way cheaper than paying a property manager each month.

I've never had to handle an eviction, but really, how hard is it to hire a lawyer?  You're going to be paying the lawyer whether it's through a property manager or not.  When all else fails, SCREEN YOUR TENANTS WELL to avoid this situation in the first place.
 
One more thing if you are serious about this being an investment.  You either manage the property or you manage the manager.

There's no way to completely remove your involvement from the management of the property unless you don't care about losing money through vacancy, overpriced repairs, etc.
 
While I understand Liar Loan's sentiment... I feel my time is worth more than $100-200 per month and the headache of getting calls from the tenants about issues (the tenants weren't being a pain... but stuff breaks down in the home and needs to be fixed).

It all depends on you... if you're handy like LL and want to save the money, do it yourself... but if you're like me and barely have the time for my own things, you may want to look into a property manager.

Just the other side of the coin.
 
Liar Loan said:
irvinehomeowner said:
While I understand Liar Loan's sentiment... I feel my time is worth more than $100-200 per month

You must make more money than me. ;D
Probably not... just waaaaay lazier.

I replaced a toilet valve for a tenant once... once.

Had to do the same thing in my own home recently... after two weeks, I ended up calling up a plumber. And while I had to spend the time to watch him do it... he did it in about 1/4 the time I took -- without toilet water all over the floor.

I think also because I had 3 different set of tenants... it took up more of my time... have you had the same tenant for the 2.5 years?
 
irvinehomeowner said:
Probably not... just waaaaay lazier.

Haha!

irvinehomeowner said:
I think also because I had 3 different set of tenants... it took up more of my time... have you had the same tenant for the 2.5 years?

Yes, I've had the same tenants the entire time and that does make it easier, and cheaper because you don't have to clean/replace carpets, paint the walls, miss 1-2 months rent, etc.

Ok, here's my tip for Advanced Landlording 201:  You want tenants that can afford your rent and have a strong history of paying their debts, but you don't want them to be debt free and earning so much that they can afford to buy a condo/townhome.  If their balance sheet is that good, they will jump into the housing market any time something gets on their nerves.  Many renters in Irvine probably have incomes that can afford home ownership in other cities.  That is going to lead to higher vacancy.
 
irvinehomeowner said:
I think also because I had 3 different set of tenants... it took up more of my time...

How long has yours been rented?  Did you rent it out when you bought a house?
 
Iho, how many rentals do you currently have? You don't have to answer if you don't want to. I was just curious. I know you're going to say between zero and twenty anyway.
 
@SoCal: Between 0 and twenty... although less than 3 is more accurate.

@LL: For that particular property, 3 sets of tenants in 4 years... the last one was my least troublesome (2-year agreement) but had the most house issues (garage door, gas line, garbage disposal). I do have to add that none of my tenants were families which I hear are the best type of tenants... but you're not supposed to screen for that.
 
irvinehomeowner said:
@SoCal: Between 0 and twenty... although less than 3 is more accurate.

@LL: For that particular property, 3 sets of tenants in 4 years... the last one was my least troublesome (2-year agreement) but had the most house issues (garage door, gas line, garbage disposal). I do have to add that none of my tenants were families which I hear are the best type of tenants... but you're not supposed to screen for that.

Mine are a late-20's married couple with two cats and no kids.  I had to do a garbage disposal about a year ago also, but that was super easy.  Google is a landlord's best friend for figuring these things out.  ;D

So you have tenants sign either 1 or 2 year leases?  I decided to do a 6 month lease with mine because the rental market was a lot weaker in 2010 and I didn't want the lease to be a sticking point.  Also, I think when a 1 year lease ends, it gets tenants thinking about moving after a year, at least that's what I remember from my days of vagabond rental life.  There was a stretch where I moved 9 times in 5 years....LOL... Landlords loved me!
 
So your current tenants are now month-to-month?

Mine were 1-year. My last tenants wanted a 2-year for a small discount to coincide with graduating from UCI.

 
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