If for some reason we are unable to sell this house, I am preparing myself for renting it out. We have friends across the street who I am considering inquiring as to whether they would be interested in being our "property managers" for our home. I think they may actually be willing do it...esp. since it would bring in some extra cash.

Has anyone ever gone this route, instead of hiring a company to manage their property? How has it worked out? Pros and cons? Also, is it better to offer a flat monthly fee or a percentage? And finally, how do you figure out that amount?

Thanks!

I would find a Realtor who specializes in Rentals.

I presume that you want to select them because they seem to have the skills you are looking for: maybe their own home and yard is immaculate, maybe he/she have great handyman skills, they have the time and desire to perform this service for you, they have good communication skills, they have knowledge of the law regarding rentals and dealing with rental applicants, they are honest and capable money managers, etc.

If so, just make certain that you handle this with a contract and ensure that there is a very clear understanding and agreement as to the "job description" you expect them to fulfill for you.

Here property Mgmt. charges between 8%-10% of the monthly rent. When the property is vacant there usually is no charge.
They perform a credit check, criminal check and last landlord feedback.
The lease is written by an attorney for the brokerage and usually iron clad.
Prior to leasing, there should be a property condition report, accompanied by a video in case there is damage from the tenant.
If something breaks at 2 am, you don't get the call, the property Mgmt. company does and gets it fixed.
If there has to be an eviction, the Mgmt. Co. knows what to do legally.
For an additional fee, some Prop. Mgmt. companies will do periodic walk-throughs and drive by the property to check on it.
If your neighbor has all these services and qualifications, I'd say go for it.

This message has been edited. Last edited by: berniek,

Ventana, be very careful here! Although your neighbors are across the street and can keep an eye on your place, what you are describing is a basically becoming a landlord which very few individuals are actually qualified to be.

Can they repair a plumbing problem, furnace failure, A/C mal-function (often in the middle of the night) collect rent from "late-payers," and take steps to evict if necessary?

Instead, I would suggest hiring a professional property management company to take care of all those responsibilities and ask the neighbors to be your "eyes and ears" as the rentals goes on.

In exchange, you might consider "paying" your neighbors every 2-3 months with floral gifts, shipments of fruit or steaks/seafood or even gift cards to Home Depot/Lowes.... Good Luck!

Not knowing the details why you are considering them I would think long and hard about it.

Are they good friends? There is a great risk when you involve friends or family with money and business.
What a tangled we weave sometimes in those situations.

How handy is this person with repairs?

Does he have people skills? I think it's a big plus for someone to have those skills when dealing with people and money mixed together.

Can you wholeheardedly trust this person explicity with your money?

This person will become neighbors with your tenant. Will this create a conflict if the tenant becomes friendy with the property manager over time?

What if the children of the neighbor and the tenants children have a conflict? How will this affect the management of your property?

Does this neighbor get along with the rest of the neighbors? The last thing you need is to be caught up in drama involving neighbors taking sides.it could get real ugly.

Will this person be able to be neutral when necessary to comply with your wishes and best interest?

You can see it isn't just collecting rent money.This is probably the biggest investment you have at this time. Were it me, I would want someone very experienced and professional handling my investment.

Don't do it; we have been in business with friends twice--bad idea both times!!!!!! You just won't believe what can/does happen.