First hire for a small management shop: leasing or maintenance?
Consider a small management shop with signed agreements on three buildings, 22, 34 and 41 units, all in the same submarket about twelve minutes apart. Fees come to roughly 9,100 a month at 6 percent of collections, enough to support one hire, not two, which makes the choice worth working through carefully. The case for leasing: 97 units means somewhere around 45 to 55 move-ins a year at typical turnover. If the owner is showing units personally in the evenings, average days vacant can easily run in the low 30s, and every extra vacant day is real money out of the owner's pocket, often in the low 40s per day. A dedicated leasing person who also handles renewals can plausibly cut that to the high teens, and renewal calls alone are worth having someone own. The case for maintenance: subbing everything out often means paying 95 to 135 an hour for work a 28-an-hour tech could handle from a van. A quarter can easily run 19,400 of vendor invoices across three buildings this size, with a large share of it being straightforward work order items. A tech also means turns stop waiting on a plumber's schedule, which is where most vacancy days actually accumulate. The two arguments cut against each other. The leasing hire fixes the front of the funnel, the maintenance hire fixes the reason the funnel is slow to begin with, and a tech's time is billable to owners in a way a leasing salary usually is not, which matters when margins are thin. A useful way to decide is to look at which bottleneck is actually costing more per month right now, vacancy days or vendor markup, and hire against that number first.
97 units across three buildings, $9,100 a month in fees, one hire. Which?
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