The one thing that separates happy landlords and miserable landlords is a quality property manager. In my opinion, the property manager is the real estate investor’s MVP.
If you are thinking about investing in real estate, I highly recommend finding a good local property manager FIRST.
Let me tell you what happened yesterday. We own some apartments in Upstate New York. We bought them in 2021 from some slumlords who neglected the property for years. It is a “value-add” investment for us and we know it needs lots of work. The previous owners “self managed” and took shortcuts at every turn. They were so bad that they didn’t even provide mailboxes for the tenants. Mailboxes. It’s what happens when people inherit rental property and just don’t care about the tenants. We are currently renovating every unit that comes vacant and improving the common areas to even include mailboxes. Imagine that.
So yesterday I get a call from my property manager: The basement of one of the buildings is FLOODED with water! Like three feet deep! A tenant called because the heat wasn’t working in his unit. So the property manager went into the basement to inspect the furnace and discovered this!
It’s the stuff that landlord’s nightmares are made of. The sump pump stopped working and the ground water filled up. The water had entered the furnace and the hot water heater and both were shot. The price tag to replace both is likely north of five thousand dollars! The previous owner had ran the sump pump hose (supposed to be a PVC pipe) out to the sewer line (which is illegal) and over time with the movement of water making the hose rub on the concrete floor caused the hose to spring a leak.
Here’s where my super star property manager comes into play.
He sprang into action, taking a water pump he had close by and immediately started pumping out the basement. He also called the HVAC repair guy and scheduled him to come the next day. 10 hours, and lots of squeegee work later, the basement was dry(ish). Today the HVAC repair guy discovered that all was not lost. The furnace could be repaired and the hot water heater’s pilot had just gone out when it went under water. All in all, the damage is going to be around $1,000 including some furnace parts, the HVAC guy’s bill, and some emergency pay for the property manager. It could have been way worse though. If we didn’t have a good property manager, with great instincts and long term local relationships with repair people we could have been in deep trouble.
So, do yourself a favor and find yourself a great property manager BEFORE you invest in real estate. They are worth their weight in gold.
After running the sump pump properly.