I made a quick trade, put an offer in on a property in Arizona and then closed my laptop and headed with the kids for lunch in La Jolla. It was after lunch that I had an all too familiar experience. We were playing tourist for the day and on the walk back to our vehicle we stopped into a small boutique store near the cove to allow each kid to choose an item of their choice as a fun reward for good behavior throughout the day. I noticed the owner of the boutique slumping over his cash register near the back of the store and I greeted him and asked how his day was going. He responded quietly, “Better then yesterday” and we struck up a conversation. The conversation quickly went toward business and the owner proceeded to tell me that he just bought the store last year and sales were considerably down. To make matters worse the landlord was increasing his rent. I empathized with him and offered some of my ideas for a short term solution but it was obvious they were falling on deaf ears as the owner quickly interrupted me and said something that made me stop and think. He told me that he was not really worried about the slower sales at his store because he was going to start managing some real estate for a couple of friends that own rentals in the area until things get better.
I was a little shocked to hear that being the owner of a local property management company and was honestly taken back. I thought to myself, here was a small business owner of a local boutique confident that he was going to solve his financial problems by managing property. I’m not saying that he couldn’t or he shouldn’t but oddly I remember hearing a similar battle cry back in 2005 when real estate was hot and everyone was becoming a real estate agent to make some extra money on the side. Has property management become the new cool thing in real estate? A million things ran through my mind as I know what it takes to provide quality property management services and I couldn’t help but wonder about the “friends” of this individual who would be relying on him to manage their asset. The tenant laws, the banking laws, local, state and federal laws, and that’s not even going into handling the asset itself.
I left the cove that day realizing a couple things; 1) More people are going to try to manage property on the side and 2) Not everyone should be a property manager. If you own rental property it’s not as simple as just finding someone who is “willing, cheap, available, etc.” to manage your property. Take the time to do some homework on whatever firm you decided to have professionally manage your property and the benefits will always outweigh the cost. I hope things work out for the boutique owner and his friends…Read more on Uncategorized