Managing property involves more than making repairs

Q: I plan to buy a fourplex and use an oncall handyman instead of property management, which is typically expensive. Since this is my first project, I want to know your thoughts and whether you have had any experience in this aspect of being a landlord.

A: It’s hard to know what to expect when buying investment property for the first time, especially with residential real estate, which is a completely different type of investment than a big warehouse or even a small office building.

Let’s start at the top. If you’re a hands-on investor and you’re skilled at maintaining real estate, you may save the money that you’d otherwise use for the management company and oversee the management of the property yourself.

Your on-call handyman (or woman) may only take care of the small fixes and repairs that are needed at the property. Having a person like that to help you is a good idea, but property managers do more than handle repairs. They typically also collect rent, do the property bookkeeping, handle leasing and deal with evictions.

Simply having a repair person on call does not compare with a full-service management company. They’re two different animals.

Make a list of the tasks involved in managing the building, and then decide what you’d rather have done for you. If you plan on advertising the property, dealing with the tenants and collecting the rent yourself, a management company may not have much to offer you. After all, you don’t want to pay a lot of money for nothing.

If you decide to hire a management company, shop around to compare charges and fees, and find out if you have to take an all-or-nothing package or if you can pick and choose services and pay accordingly.

It all comes down to how much you want to be involved, given the other priorities in your life.