During the course of ongoing discussions with property managers, landlords, and real estate investors within the iRISQ community, we have happened upon a growing class of property managers that we have dubbed the "reluctant property manager" or RPM for short.
What is an RPM you ask? The RPM is typically not a salaried property manager, but rather, a real estate investor or agent, who find themselves acting as the grudging manager for one or more rental properties.
Perhaps they are a first-time individual or family rental property owner who quickly realize that they do not want to be rental property owners but find themselves unable to sell their properties without taking a significant financial loss. Perhaps they are real estate agents who, due to the current housing crisis, find themselves forced to ramp up property management activities for their clients to generate income while continuing to try and sell properties. An RPM can even be a large, experienced individual real estate investor who inadvertently has a couple of rental properties fall into his lap during the course of a broader real estate transaction.
Unfortunately for many RPMs, the current housing crisis threatens to keep them in their relucant roles for an extended period of time.
We are finding that, although there were significant differences (experience, background, portfolio, etc.) amongst the RPMs that we spoke to, there were some surprising commonalities:
- RPMs often do not often have the same depth of experience as a professional property manager
- RPMs typically specialize in certain aspects of the real estate business (e.g. marketing, sales, maintenance) and want to focus on their speciality
- RPMs tend to range from simple disinterest to fear to downright loathing of the other aspects of the rental real estate business
- RPMs religiously avoid inter-galactic property management tools and usually opt for home grown Excel worksheets
- RPMs want to minimize contact with rental applicants and tenants
- RPMs want to find a way out of their circumstance as soon as possible
Although we have been tightly focused on serving the tenant screening needs of the iRISQ community, our growing cross-section of RPMs are asking us for more and we are considering how best to serve their property management needs.
So my question to you, is are you and RPM, and if so, what are you doing to improve and/or survive the experience? Also, what kinds of tools and services do you think are essential to making your life as an RPM, easier, better, and more profitable?
-Gary
Published on Mon, 06 Apr 2009 14:26
So what’s wrong with meeting all of your own prospective tenants and then going off of your gut feelings?
If you are an experienced property manager or landlord, then your gut probably gives you useful information; however, there are some risks involved. Fair housing rules say, more or less, that you should establish a set of objective applicant criteria and then select the first applicant that meets those criteria. As more “unconventional” applicants enter the rental market and have difficulty renting, we can expect fair housing complaints to rise as well. In such circumstances, using one’s “gut” doesn’t figure into that equation. Also, few landlords have ever seen a rental housing market anything like what we’re now experiencing, so their gut may not tell them what it once did.
If you are an inexperienced property manager or landlord, then your “gut” may be costing you (or your client) money and hassle. Until you’ve had a chance to correlate your gut instincts to actual results, you’re inviting unnecssary risks, especially when there are alternatives that will help you make better decisions or to at least create a documentable rationale for the decisions you’re making.
Published on Thu, 16 Oct 2008 17:17
So, the most obvious question for many landlords is, if credit reports have always worked just fine for me in evaluating rental applicants in the past, then why should I do anything different? The times they are a changin. Credit reports only ever answered an important but limited set of questions about rental applicants financial background and left other important questions to conversation and intuition.
Did they pay their rent on time? Did they damage the property? Did they honor their prior lease? These and many more questions are difficult to ask in a manner compliant with fair housing practices, but they are important indicators of whether or not you’ve found the right tenant.
The on-going housing crisis has left credit reports telling you less about rental applicants and may lead you to miss out on good rental opportunities or expose you to additional risk of fair housing non-compliance which will undoubtedly be on the rise as applicants find it more difficult to secure rental housing.
Published on Fri, 10 Oct 2008 02:15
Barry Vial, real estate veteran, iRISQ team member often poses interesting and challenging questions about how people are using iRISQ today and how I expect them to use it in the future.
The more and more I speak to property owners and property managers, I find that many of them have the same kinds of questions. The result of that realization is this blog. With it, I hope to capture some of the more interesting and relevant conversations I’ve had about iRISQ and how we can continue to help all of those participating in the rental housing market and to stimulate more discussion around these topics.
The title of this blog, Curmudgeonly Yours, comes directly from how Barry signed one of his famous emails.
Published on Fri, 03 Oct 2008 02:16
