The no-personal-work rule and whether that forces full third-party management

The part that would keep me up isn't the vendor selection, it's tenant contact. The day a tenant calls you and you agree to something, you've made a decision that looks like management to anyone reading it later. A manager gives you a clean paper trail where every interaction is between the tenant and a company the IRA pays at market rate. That trail is worth something on its own, separate from whether the underlying activity was ever a problem.

The manager markup buys some things and not others, and I've seen this from the inside on a small service team. It buys someone who answers at 9pm and a vendor bench that shows up. It does not buy scrutiny on a $9,400 bid. My honest experience of managers reviewing scope is that they read the total and the timeline.

@harrow if you go the manager route, put a bid-approval threshold in the management agreement, something like anything over $1,500 comes to the account holder with two bids attached. That keeps your eyes on the number without you running the trade, and it's a normal clause managers will sign.

Eight percent of $1,300 is $104 a month. If that kills the deal the deal was thin before the IRA was involved.

@bramble that's understating it. It's the 8 percent plus a leasing fee that can run half a month or more, plus renewal fees, plus the repair markup @cobalt mentioned, and in an IRA the vacancy that manager fills is also being paid for out of a cash reserve you had to fund with contributions capped by law. The all-in drag on a single low-rent house is a lot more than $104.

Which is why I keep circling the same conclusion, one house inside an IRA is an awkward size. The structure wants either something with enough units to carry professional management or something with almost no operations at all, like a note or raw land.

@windlass that's roughly where my due diligence keeps landing too. My IRA positions are passive on purpose, one note and one LP interest, precisely because I didn't want to build a compliance argument around my own labor every year.

@harrow the thing I'd want you to price honestly is what your own coordination time is worth on top of the risk. You said you can spot a padded line. You can also spot it as a service to a manager you're paying, and the difference between those two versions of your afternoon is a paper trail, so the risk-adjusted savings might be smaller than the fee looks. Where the coordination line sits legally is a professional question and you've already got two answers on it, which itself tells you the answer isn't clean.

Reading as someone learning how the money side works, the part I hadn't understood is that the manager's fee comes out of the IRA and so does everything else, and you can't just top the account up when it runs short. So the fee is buying compliance comfort with money that's harder to replace than regular cash. That reframes it for me toward fewer, simpler assets.

Documents view. Whichever way you go, the management agreement or the vendor contracts have to be in the name of the IRA or its entity, signed in a representative capacity, and the payments have to leave the account, not your checking. That's the part that gets people, and it's mechanical.

On the actual question, I'd hire the manager and I'd do it for the same reason I use a title company on a cash deal where I know the seller. The fee is priced against a failure mode that takes the entire account, and there's no partial version of that failure. I'd also want the manager's agreement to name the IRA correctly on page one, because I've read three of these where the vesting was wrong and nobody noticed until a renewal.