Is Your Time & Family worth More than Managing a Property?
So you have purchased a property or currently have a rental property you are managing yourself. Great you are on track to create long-term wealth, cash-flow and a better retirement for you and your family. But could you spend your time more wisely than managing the property yourself?
Let’s look at an example of a father, Jim.
Jim has two kids, he works in Wellington and receives a yearly salary of $90,000. Jim works close to 50 hours per week and doesn’t really have much time for his family, wife let alone himself but he insists that he will continue to manage his rental property as he doesn’t want to pay someone else to do it, he would rather pocket the money himself.
Jim is right he can manage the property himself, he is capable of doing this and he can also pocket the money himself.
Where Jim is wrong is that he is looking at it the wrong way.
How valuable is your time? Invaluable, true.
With time, you cannot get it back and there is the same amount of time for everyone, not just Jim. The problem that we all have like Jim, is that he doesn’t value time on a monetary level.
Jim’s property rents for around $20,000 per year which on say an average 8.5% management fee would be $1,700 per year. If we take Jim’s salary he only needs to work 1 week of the year at his job and the entire property management fee is paid for the year. Plus he can claim tax on the management fee so this would drop to around $1,224 per year.
Now Jim doesn’t have to worry about:
- Making sure rent is paid
- Maintenance issues
- Rent arrears
- Tenancy tribunals
- Tenancy issues
- Handling repairs
- Inspections and inspection reports
- Getting phone calls when on holiday
- And the list goes on
By using a property manager Jim also gets:
- Tax deductible on his management fees
- Rent is typically $15 higher per week
- Your property rents quicker by 1 week per year due to performance
- Almost works out to be a FREE SERVICE!
Jim can now spend more time with his kids, wife and play golf with his mates because he has more time to focus on life rather than focus on something he doesn’t need to and for very little money.
Contact us for a free no-obligation rental appraisal you will be surprised how affordable we really are.