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Should a Property Owner With a Property Manager Do Their Own Repairs?

Should a Property Owner With a Property Manager Do Their Own Repairs?

“I want you to contact me first before you authorize any repairs on my property.”

This is a common statement that property managers hear from property owners.

The sentiment behind the statement is understandable from a property owner’s perspective. I own the property and know the property better than anyone, its my money that will be spent to make repairs to it, therefore I should be the final decision maker on any and all repairs that happen on it.

Property managers are responsible to act in the owner’s best interest and as a fiduciary of the property owner. But, is honoring this request and agreeing to contact the owner for every repair request that comes in actually fulfilling that fiduciary responsibility or acting in their best interest?

The short answer to that question is, we don’t think so, and in this blog post we want to explain why and also explain why we typically respectfully push back on owners who say this to us.

What is “property management” anyway?

This may seem like a silly rhetorical question, but it’s evident by the dozens of phone calls we take every month from prospective property owners that no one really knows the answer. Everyone has a different preconceived notion of what a property manager does in their head before they start searching for service. And for many, that preconceived notion persists even after they have made the hiring decision for their property manager.

And you can’t really blame these prospective owners. Call five property managers in your local area and ask them what exactly they do and you are likely to get five completely different answers.

Sure, they all offer the same core services such as marketing the property for rent, executing leases, handling repairs, performing inspections, and so on. But how they go about doing that and how much they involve the property owner in those activities varies widely.

We can’t tell you exactly how your local property management company defines property management but here’s a glimpse into our philosophy of property management.

Yes, we perform all of those core services listed above and more, but we perform all of them with a high degree of trust and minimal input from the property owner. Here are some examples:

Some management companies allow the owner to approve a prospective tenant before they rent to them. We don’t. We find a tenant that meets our rigorous requirements and then execute a lease with them, ensuring our property owners steer clear of the myriad of Fair Housing landmines in the process.

Some management companies wait for the owner to tell them to renew a lease or increase the rent. We don’t. We proactively reach out to the owner with recommendations for how much to increase the rent for and whether or not to renew on a 1 year basis or month to month only, then get it done right at the expiration of the current lease term, year after year. All so the owner is always maximizing the amount they are getting for rent while staying on the most current lease with the latest legal protections.

Some management companies receive repair requests from tenants and then consult with the property owner on how to move forward. We don’t. When we receive a service request, we take immediate action up to a certain pre-defined repair limit previously agreed to by the property owner. We make sure the tenant is safe, the property is safe, and the functionality of the property is restored as soon as possible to minimize tenant safety and habitability issues as well as increasing the owner’s ongoing ROI since a happy tenant is a renewing tenant.

I could go on, but you get the point.

Now call five companies in the area and ask them how they handle each of the above scenarios and this is where you will get the widely varying responses.

Many of them will rush to assure you that they don’t take any action whatsoever related to your property until they have your full buy-in and approval. They tell you this because they think this is what you want to hear.

But do you actually want them to do that?

You see, most owners don’t stop to think that maybe they don’t want to be that involved with their property. They stay hyper-involved because they think they have to. They think they are responsible to manage their property manager.

And when they call around looking to hire a property manager, most of those property managers are ready and willing to tell them exactly what they think they want to hear - “Yes, Mr./Ms. Owner, we will contact you before we spend a single dime or make any decisions related to your property.”

What we think property management is

When you “buy” property management, you are actually paying for access to the well trained, well experienced, decision making brain of the property manager.

The brain of the professional who has truly “seen it all before.”

It’s that simple. If that’s what you really want in a property manager and you can understand that, then once you find it, you won’t want to “co-manage” or be hyper-involved in any process related to the management of your home. Frankly, you will want to step aside and let the professional do his or her job.

If you have a toothache and you go to the dentist and the dentist says “you need a root canal,” do you say, “No doctor, I think we should just put a crown on without doing the root canal and call it a day”?

Of course not. Now you may want a second opinion on whether you need the root canal in the first place, but you don’t decide you want to go with that dentist and then proceed to instruct the dentist on how to do what’s necessary inside your mouth. You either accept the treatment or you don’t, but once you accept it, you aren’t the one giving direction to the dentist.

The same is true with truly professional property management. You aren’t paying for a personal assistant to act at your behest. You want someone who will do it better and more efficiently than you would, not necessarily exactly as you would.

This is the true value of professional property management! If you own rental property, you can hire a starving real estate agent with little to no experience managing property to run around at your bidding and provide no advice or input as to how things get done. They simply present you with information and you make the decision.

But this isn’t property management, at least not how we would define it. In this scenario, you are the property manager, and whoever you’ve hired with that title is simply an information passer. A middle-man. A personal assistant.

But not a property manager.

That title is hard-earned, well-deserved, and reserved only for those who have the years of experience coming across every scenario imaginable in residential real estate and are trusted to make the right call on how to handle it, time and time again.

Once you have this kind of property manager, isn’t it so much easier and more fulfilling to leverage that professional brain to your advantage and let them make the decisions on your property? So much easier to remove the shackles you may have placed on them in the past, requiring them to contact you for each and every little decision to do with the property?

And maybe you don’t have that kind of property manager. It may mean that it’s time for a change.

What’s the point?

What does any of this rambling have to do with the title of this post? In case you forgot, it asks the question of whether an owner who has hired a property management company should handle their own repairs.

And by now, we hope that question has been answered (it’s a no!). But if not, here are a few additional reasons why it’s best to let the property manager you’ve hired handle the ongoing repairs and maintenance to your property while involving you as little as possible.

Involving the owner too much slows the process way down

Imagine it’s a weekend and it’s raining heavily. The roof on your property starts leaking. The property manager gets a call from the tenant in a panic explaining the situation.

The property manager knows they have a contractor in the area on a different job and can reroute said contractor to your property to tarp the roof and stop the leak until the rain stops and the repair can be done.

But, your notes in the property manager’s software say “Contact the owner for all repairs.”

For a property manager, this means all stop until the owner is aware of the situation and either approves the property manager’s plan of action or takes matters into their own hands.

However, you decided to get out of town during the rainy weekend and you are halfway across the Pacific Ocean on your way to Hawaii.

And your roof continues to leak. Until you land, see the text or email, and respond to the property manager something to the effect of “I’m out of town and can’t get there myself or send my guy. Go ahead and send yours.”

But it’s been three hours since the property manager first reached out until you’ve been able to respond. Now that the property manager finally hears from you, the contractor is booked for the day and the roof has continued leaking, causing further damage. And it will continue until the next day when the contractor is able to go out again.

All for what? So you could just tell the property manager to do what they were going to do anyway?

It may seem harmless to a property owner to just have the property manager contact them before doing anything. What’s the big deal, I just want to know what’s going on as it happens?

Time and time again we have seen that one little requirement from the owner be the proverbial wrench in the machine that causes the whole operation to come to a screeching stop.

Involving the owner increases liability

Property managers have a host of qualified, insured, and licensed vendors for every job imaginable. A property owner who wants to handle their own repairs is often going to the job themselves or sending a friend or family member who is none of these things, potentially increasing their liability in the process.

Involving the owner comes with huge opportunity cost

Maybe you have a bunch of really well qualified vendors to send, but you just want to be involved in the process.

Every moment you spend managing your property comes with opportunity cost. Like answering the phone in the middle of a family dinner or holiday to approve some action on your property. Isn’t your time worth something, especially in moments like that?

Involving the owner breaks the PM/tenant barrier

The PM/tenant barrier is the insulation that you have from your tenant. If your property is professionally managed, the tenant should have no contact with you. All communication funnels through the property manager.

However, if you are known for doing your own repairs, chances are the tenant will have your contact info since you have to coordinate with them. This leads to the high probability that in the future, the tenant will just call you directly instead of the property manager because they know you will handle it anyway and going direct to you gets them the fastest result.

It begs the question, why do you even have a property manager in the first place?

You are paying for trust

At the end of the day, when you hire a property management company, you are paying for trust. You are trusting that they will answer the call from the tenant, make the right decision, and look out for your best interest.

Trust is the currency in this relationship. Once broken, many property owners will look for a new property manager to create that trusting relationship with.

You will always be able to find the property management company who will customize their service for each and every property owner they serve. You can easily find the property manager who will contact you for everything.

But back to that first question, is that actually acting in your best interest? Is that actually acting as a fiduciary?

We think not. We think you should let the property manager prove to you that they are a professional, then get out of the way and let them do their job.

But then again, we aren’t a good fit for everyone. This is simply our management philosophy and our opinion on what makes a true property manager.