RentBetter CEO Jeremy Goldschmidt says self-property management can be cost-effective and provide you with greater control over your property investments.
Property management and all the problems that come with these investments can be overwhelming for individuals, who often seek a professional property manager to take care of everything.
But this can come with potential hurdles – lack of trust, transparency and costs to name a few.
That’s why Jeremy Goldschmidt was inspired to create RentBetter – a DIY self property management platform.
He recently joined KnowHow founder Bushy Martin on the Get Invested podcast to talk about the key advantages of self property management, which he has seen through his own experiences with customers.
He said the first benefit is the significant financial savings.
“The cost equation isn’t the main driver, but it is a big reason for doing a lot of changes in behaviour. And what I mean by that is if you can save a couple thousand a year by managing your own property over the life of that property, because it’s a long term investment, it’s pretty meaningful. If you’ve got multiple properties, it becomes even more meaningful,” he said.
“So if you told customers you can shave 50 basis points or 0.5% off the interest rates, they’d perk up. And obviously, depending on the loan size, if you look at what you can save on property management, in theory it’s about the same or equivalent on a 500K loan or similar, you can offset interest rate rises as they come through to some degree by doing this yourself. So this is an element I think of just cost savings.”
Jeremy also explained that the ability to better manage your payments and finances through technology has been impactful.
“What we generally have found around this [at RentBetter], and our customers sort of give us really positive feedback, is that technology has sort of led the way in making sure that a lot of elements [finances and administration] are far superior to what most property managers can offer today,” he said.
“And what I mean by that is, it’s about having a payment schedule that relates back to the lease agreement – which was already signed as a legal contract and document that everybody’s a party to – and making sure that those payments happen on schedule. And if they’re not and there’s going to be an issue, then making sure that there’s a way to catch up or make those payments and record it and receipt it and do all the right things.
“So it’s the ability to capture all different things, transfer the cost to your tenant where you need to, and make sure that everyone again has a clean record of it, knows what it’s for, why and when it’s happening.”
The second major advantage is having greater control over your investment and the associated costs.
“We often liken it to the explosion of self-managed super funds over the last 25 years. A really big part of that was about the control and transparency, and we get the same signals here. [Landlords] just want to know what’s happening and they want a system where it’s all controlled,” Jeremy explained.
“Especially with a property, it’s not the type of activity that requires that constant checking, but it does require a level of control and management. And that’s sometimes a little bit less available to them when there’s a property manager. Someone else saying ‘just leave it with me’ doesn’t suit a lot of investors who actually say, ‘well this is my asset, this is my investment’.
“You can control the cost base and therefore you can reduce the outgoings. And it’s not to the extent of checking daily, it’s just being really comfortable that you have an investment and the ongoing costs of managing that investment are being well managed.”
The third element tackles the potential issue of trust with property managers and having someone else manage your assets.
“If everyone did a really great job out there with really great prices, then maybe no one would ever consider self-managing. But the fact is that, you know, it’s hard to go a weekend or a week without hearing a friend or family member tell you a story of how they were wronged somewhere by a certain professional. So I just think that there’s a lot of individuals out there who are now used to using technology and platforms, who are used to doing things themselves,” he said.
Listen to the full interview here.
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