When it comes to renting and owning your own property, we know that many Buffalo landlords live by a “Do-It-Yourself” mindset. This is the idea that you can go about renting, renovating, or repairing things yourself instead of hiring a professional property management company.
While we can certainly understand and respect that motto (we were there once ourselves), we also think it’s essential to discuss some of the challenges that the Do-It-Yourself mentality can present, and how a property management company like Nickel City can save you time without the added stress.
In this blog, we will run through some of the “hidden” costs of being a DIY rental property owner and how Nickel City can help take the load off your shoulders.
How The “Do-It-Yourself” Motto Works
We have just outlined the basic idea of how the Do-It-Yourself motto applies to property management, but how does it work? It involves a real estate investor or property owner handling their own house improvement, repair, and maintenance, or any other various responsibilities involved with managing a property.
Some of those responsibilities include monitoring legal and administrative tasks like adhering to local landlord-tenant laws, maintaining proper insurance, and managing all financial records and bookkeeping.
You’ll also have to find tenants, maintain the relations you have with those tenants through enforcing terms on a lease, collecting their rent payments, or handling any complaints from them. All of these different roles you would take on require a lot of time on your hands and experience to keep up with every person that you collaborate with.
The Hidden Costs of Doing It All Yourself
If you’re a first-time property owner, it doesn’t sound all that bad, but once you actually experience working with all of these tasks, you’ll find out quickly just how tough it is to manage without someone else to come in and help.
Managing tenants, maintenance issues, understanding state laws, prioritizing tenant quality, and making sure to receive all of the different types of payments and fees can be a massive undertaking, especially if you plan to own and rent out more than just one property.
Mismanagement of Rent and Other Fees
Mismanagement of rent and other fees can be a major hidden cost for a DIY property manager if a landlord is experiencing financial instability, which can lead to legal troubles.
A whole cycle of issues can be caused by this, which can even produce its own versions of hidden costs. Mismanaging those fees and the rent will cause a high amount of tenant dissatisfaction, which will then trickle down into other areas like maintenance and, most importantly, a potentially damaged reputation. If a tenant sees that that isn’t properly handled, they will feel less confident in other areas of your management.
That’s why we recommend that you work with a professional property management company. While you might have to pay us a fee for our services, we are still able to handle those payment options the tenants need for a smooth transaction process, while also allowing us to handle the accounting/logging of it all.
The Expense of Legal Claims and Lawsuits
We talk about how it can be a pain to spend money as a part of a DIY property manager, but something you REALLY won’t see coming until it hits you is all those legal claims, lawsuits, and other regulatory mistakes that can be made and cost you.
Most of the time, these types of hidden costs can come from not adhering to lawful regulations like RERA (Real Estate Regulatory Authority) or pricing your property incorrectly, and even something as damaging as not having a vetted and proper maintenance portion of your management set up. Tenants will not appreciate it if the property is not in the best shape and can’t be upheld to that higher standard where it should be.
Some of those other legal claims you could receive can relate to discrimination, negligence, breach of contract, and mismanagement of funds. Here in NYS, by the laws of fair housing established by Attorney General Letitia James, you must abide by how you treat the people you allow into the properties.
Prioritizing Tenant Quality
Something that every rental property owner needs to think about is prioritizing tenant quality, and that can become a major hidden cost. It’s understandable that saving money and maximizing rental income are among your goals, but it shouldn’t come at the expense of the tenants not receiving the best quality they deserve.
A consistent income stream will come much more organically with a prioritization of this, and allow for much better tenant retention. That can also help to reduce costly turnover. Nickel City Property Management can help you with this part of the job! We find ways to take care of the properties, provide valuable feedback, which can help lead to fewer maintenance issues and an increased value on the property.
And that’s the ultimate goal at the end of the day: how can we help you make it better? We respect anyone who handles property management on their own with their DIY mindset, and we certainly don’t want to take that away from them, but we also think there may be some angles to that mindset that will allow us to come in and help where it’s needed.
On our website, we have the best information you need to help you understand our process for how to help both tenants and property owners. If you have any questions, the best way to reach out to us is via our contact form or by phone to set something up with Steve Kottakis! Steve has helped many owners and tenants alike here in Buffalo, and he wants to help you too!
