Thankful For My Property Management Company: Hidden Value In Hiring Nexus Property Management®
Residential property management is an interesting industry in that very few people have much in terms of real estate investment literacy. To that point, investors don’t get rich having one or even two properties, but very few people own more than a couple properties. For those that do, hiring a professional property manager makes sense, mainly because it’s difficult for individual owners to keep up with the scalability of a professional. Subsequently, working with those more heavily invested clients is how these companies survive. But if you are someone with just one property, is there value in hiring someone if you don’t have the time or ability to manage the property well yourself? Is there as much value for you as there is for someone with a larger portfolio? If your property manager is Nexus Property Management®, the answer is yes.
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If debating whether or not to hire anyone in the first place, Nexus makes this decision easier by providing their free D-I-Y Calculator. The question I asked myself, even before looking more deeply at the numbers was simple: is it worth 8% of the rent I’m collecting to have a partner in this enterprise...or will that fee make it difficult for me to turn a profit?
SHORT ANSWER REGARDING VALUE:
The flaw in the question I asked myself above is that I was thinking in terms of short-term returns. In reality, now that I better understand the industry, even if I don’t make a dollar month-after-month, it’s well worth it to have a property manager in my corner. To have a partner in ensuring long term tenancy for my property, creating a comfortable situation where someone else is paying off my mortgage, is worth every single penny every day of the week.
WHY NEXUS IS ELITE:
I bought a property in West Warwick, Rhode Island. If you’re not familiar with the area, it’s typical of many southern New England towns built along a river: an old mill town struggling to keep its identity long after so many jobs have disappeared. Close enough to Providence and other points to support the population, most of whom are working class. If people outside of the Ocean State have heard of West Warwick it’s only because of one of the worst nightclub fires in U.S. history. It was February 20, 2003 when a Great White concert and faulty pyrotechnics led to 100 deaths and almost 200 more injuries. Since then, the state of Rhode Island became much more vigilant in terms of fire safety in commercial spaces. As you may or may not be aware, multi-unit apartments with four or more units are considered commercial, so strict fire codes and the expensive infrastructure that comes with it have been the norm across the state over the last 20 years for real estate investors.
As much as the state has buckled down, the town of West Warwick has gone even further. I’ve had no issues with tenants or any great expenses with one large exception: meeting the demands of the fire marshall. The property is a four unit apartment, built in 1890, collecting market-value rents and I bought it in good shape...but in my first full year of ownership I paid over $12,000 to meet local fire codes. As a first time owner, this was no doubt a huuuuuuge headache and I instantly questioned my decision to invest in the first place.
Since then, things have been quiet and those expenses have been erased by rents collected, as is typically the case over time. But every once in a while I’d get a certified letter from the West Warwick Fire Department and my heart would sink as I opened the envelope. Luckily all is good, and they were just letting me know everything was still fine with the exception of a common area emergency light that had gone out (these guys don’t miss a thing). Luckily I had Nexus maintenance techs to take care of these things for me, ultimately decreasing the stress of having someone to tackle it as well as confidence that the issues would be resolved.
HOW MAINTENANCE WORKS WITH A PROPERTY MANAGER:
When tenants request maintenance, owners will get an email alert and can find details in their Nexus Front Office maintenance tab upon login. Owners then have the option to approve, deny, or ask Nexus questions regarding the maintenance need. Last month I was looking through my maintenance tab and saw a completed Work Order that I’d never given approval for. This is not typical and I was confused but clicked on the “details” tab. Here’s what I found:
“Fire alarm inspection expires this month, meet with fire alarm inspector to escort him through building and units for annual fire alarm inspection; inform tenants 48 hours in advance that Nexus will be entering all apartments and that fire alarms will be heard.”
WHAT DOES VALUE MEAN TO YOU?
If I could change any one thing about my early property owning experience, my first thought would be to own an apartment in a town that is not so intense with their fire code. After stepping back, it is important to actually appreciate the value that the town and the fire marshall provide to ensure my tenants are safe. So as much as the expenses are not ideal, and the pressure of meeting their standards is stressful, it is for good cause. And...because I hired Nexus Property Management®, I literally don’t have to think about this anymore. I am able to collect passive income while Nexus’ maintenance experts create a barrier between myself and my greatest stressor. Not only am I making money through my investment, but I am doing so without the typical worries that come with the territory.
[ Learn More: How To Get Started In Real Estate Investment: Step by Step ]
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Mick Lefort is the Vice President of Operations for Nexus Property Management®. A National Property Management Franchise that manages all types of rental property from single family homes or condos to large apartment buildings and complexes.
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