How to Manage Out of State Rental Property

Out of state rental property
The Deck (at 50 degrees)

For those of you who follow my Blog, you know that my properties are very close to my own home.  All are within a few miles; the furthest is seven miles away.  It may not always be that way, and sometimes you will need to manage your properties from a distance.  Even if your properties are close, if you move, perhaps to a retirement location, you will need to know how to manage out of state rental property

I wrote a previous article on long distance property management about this a while back.  I also wrote about the disadvantages of having to manage out of state rental property.

The secret to managing any property is to have great tenants. Great tenants can think ahead, and can anticipate issues before they occur.  They take action to avoid having a problem.

Regardless of where you live in relation to your properties, you need to be able to manage them effectively.  Whether they are 7 miles away, or 700 miles away, you need to set yourself up so that you do not have to be on-site as often.

My recent trip to Florida will illustrate an example that can help.

My situation will not help you do a rental turn, but it will help you understand that you do not have to have boots on the ground at all times.

I had my Florida trip booked a few months in advance, scheduled for the coldest month of the year, so I was ready for a nice warm up.  It is a great place to strategize for the upcoming year and look at other properties.  Fort Myers Beach was calling my name on Sunday, 1/25 and it was -12 degrees outside in Minnesota.  My friend drove me to the airport, and was going to watch my dog for me.  I loaded up the suitcase and dog in his vehicle and I headed to the airport.

Tip:  When you use a taxi cab to go out of town, the cab driver knows you will be gone.  Is he/she also casing the place for a future break in?

Contacts are Critical

I have an Android smart phone with lots of contacts in it.  They are also available on the web via Gmail contacts.  Contacts are crucial elements when you need to get a problem resolved in your rental property.  With 24 renters, soon to be 25, there will likely be some sort of tenant correspondence.  Maybe it will be an emergency, maybe a quick answer, maybe a fix I need to schedule when I get back.

I do not let my tenants know I will be out of town.  I am not opposed to it, but as much as I want to tell everyone I am enjoying myself on the beach at 80 degrees when it is -12 in Minnesota, I do not want them to feel like I am traveling on their hard earned rent money.  Truth be told, my renters likely take better vacations than me, and my rips are mostly business oriented.  And it was rarely over 60 degrees the week I was in Fort Myers, and was in the 50s a lot.  So much for warmth…

Have the Right Tools

A smart phone, and a laptop are important pieces of technology that can help.  Of course, WiFi in a hotel is almost a necessary item.  You can set up your phone as a hot spot too, in a pinch.  Google is your friend is you need to find someone to help with boots on the ground.  Plumbers, electricians, handymen are all available to help, if you have a credit card…

I am not sure what people did before the internet, even though I was there.

You should also have all maintenance items complete before you leave.  If you leave one thing that “can wait”, it will come back to haunt you when you can least afford to deal with it.

The First Crisis, Not even Off the Ground

Upon getting to the Airport, and passing through the TSA, I was waiting at my gate.  A tenant texted me and told me the CO detector was going off.  I had this problem in the past with this unit, and after I cleaned the burners the CO issue was resolved.  Now it was happening again.  And I was on vacation.

I told them to turn off the furnace, which they had already done.  I offered space heaters, I told them to buy what they needed at Home Depot, and I would reimburse them.  I called a plumbing and heating company to come over and give me an estimate.

I had already received an estimate for this furnace from a different company a couple of months prior, so I knew the ballpark estimate.  I have also changed out a few furnaces myself, and I know the cost of a replacement furnace.  I am not going to pay neuro-surgeon rates to a furnace installer, no matter how good they are.

Estimates Need to be Evaluated

I contacted the tenants again and let them know the furnace estimate guy would be there the next day.  They were going to be home, so it was not a big deal.  The estimate came back at $3,550.00.  The estimate I had from the other company was only $1,875.00.  The furnace itself is probably less than $750.00.  So it makes sense to get a couple of estimates and know what a basic install should be at.  I saved $1,675.00.

That was the only call I received from my tenants that I remember.

Manage Your Own Property from Out of state

When you are away from your own property you should do a few things that I do.  Turn off your water main.  If you have a massive freeze, it may help prevent damage.

Turn your water heater to vacation mode.  It will save money.

I have two Nest thermostats, so I can check on the temperature from anywhere in the world.  I set the away temperature to 50.  I have hot water heat, with radiators, so it always takes a long time to heat back up from a lower temperature.   The last morning we were in Florida, I logged in to the thermostats and set the temperature to 70.  When we got home, it was nice ad warm.  Great invention, great product.

I also have security cameras that I can log into to see what happens when I am gone, and all events are recorded.  As a matter of fact, a motion detector went off in my own home, and the police were called out.  Nothing was found.  I also went back and reviewed the security footage, and there was not issue.  When it’s -12 and 3 AM, criminals are in bed.

Other Properties

I did look at a 4-plex.  $825K, near the beach, with $125K a year in revenue.  It was tempting…  Not so much for the numbers, but the warm weather and location is appealing.  Other properties were over $1M.  Ouch!

The Extra Stuff

We did a few things in Florida, and ate a lot.  Never the same place twice.  I ate grouper about 10 times, so if the market price of Grouper spiked that week I was there, you know why.

We took the Audubon Societies Crooked Creek Boardwalk trail.  It is a 2.25-mile boardwalk trail through the swap.  There were a few birds, and a bunch of birders.  Some had cameras with lenses that could take a picture of Neil Armstrong on the moon.  They got all excited about a yellow-bellied sap sucker bird.  To me, it just looked like a standard woodpecker.  When I was a kid, I probably shot many with my trusty BB gun, but I didn’t want to tell them that.

An alligator was sitting on a bump in the marsh.  I thought someone should throw a stick at it to get it to move a bit, but I refrained from doing it.

A cottonmouth moccasin was soaking up the sun just a few feet away from the boardwalk.  Plenty close enough if I had a shovel.  It was all I could do to keep from getting a stick and killing it.  No good comes from poisonous snakes.  They are better off plenty afraid of humans anyway.  I only had my tennis shoes on and the ground was swampy, and there weren’t any handy sticks around, so it got to live another day.  If I ever move to Florida, I will have to kill an extra one to make up for the one I let get away.  Those birders would have probably come around the bend and saw me and freaked out.

A good adventure, and something to do in Florida if you are in the area.

We went to the Ford and Thomas Edison’s Winter Estates.  That is a great place, Edison has invented anything there is to invent.  I am not sure how he did it, as all the places he lived in were prior to 1978, and lead paint was all over.  No calculators, no computers.  But he figured out a lot of things.

20160121_101155The advantage of having such cold weather when we were there is we saw a bunch of manatees.  They are an odd creature, sort of like a Walrus without tusks.  At Manatee Park, there were plenty of them.  The park service counted at least 137+ on one day we were there, and 125+ another day.  There are only a couple of months of the year that they congregate there.  It was on the way to a couple of places we went, so it was a quick and an almost free stop.  Only $2 per hour to park, and admission is free.

Here is a short video I took of the manatees.

Have you had to manage property without being there?  Have you taken a vacation and had to deal with renters?  If you are a renter, do you want to know if your landlord is away for an extended time?

18 Replies to “How to Manage Out of State Rental Property”

  1. I had a property I bought in Atlanta before I moved to Tennessee, so I managed it for about 6 years after I moved from afar. That was the worst experience of my life. I hired a property management company and they did OK, but the tenants were shoddy and they never kept up with the maintenance. When the last tenants moved out, I fired the PM, had to fix about $15k worth of damaged (including a cockroach infestation that the PM never knew about!) and sold the house. Whew! What I relief. It was all a huge learning experience and now I will only own properties I can get to in about 20 minutes or less.

    1. Chris – I plan exactly that: to rent out my house the day I need to move out of state, instead of selling it, and your experience scares me a little.
      If I had to get into that myself, is there anything you would recommend doing to make it a better experience? Different tenants? Different PM?

      1. Eric’s tips are good. I didn’t know much about tenant screening and keeping an eye on the PM when I had that property, so I certainly would do it differently now. Plus, the property was in a depressed area so the quality of tenants was low. I invest in better areas now.

  2. I’m in Tampa and I really enjoyed the Edison estate. I love the audio tour players they give you. Kind of cool, how they were looking for a replacement source of rubber and grew all of those different types of trees and plants.

    1. Thank you for reading!

      Edison was a genius. And between the bamboo he used for a light bulb filament and the rubber tree research, he accomplished a lot. It’s amazing that it was not that long ago we had to use candles for light.

    1. Thank you for reading!

      I purchased a 16-Channel Samsung camera system from Sam”s club. It was on sale for ~$500. I have 6 cameras up so far, and will install all 10 that came with it when it warms up. Hard wired cameras.

  3. I listed a few properties for my brother and sister, but managing is a different animal. However, I must say it’s wise to have property in Florida. Going to FL for “work” is great, especially of the long and cold winter in MN. 😛

    Best of luck to you! Have fun!

  4. I had a tenant whose toilet would not stop running. She called me. But I was out of the country and couldn’t be immediately reached. So she went to the phone book and picked the first plumber she found. He came out and charged her $300 to replace the float assembly, which I paid.

    Sure, she could have simply turned off the water supply at the back of the toilet and used the other bathroom. Then I could have taken care of the problem for about $30. Or she could have called my plumber who would have done the job for less than $100. This was clearly my fault for not showing her what to do in such a situation and following up with written instructions.

    Now I provide tenants with a binder — a Tenant Handbook — that includes a list of whom to call in case I’m not available. An electrician, a plumber, a roofer, and an air-conditioning repair mechanic.

    George Lambert
    Author, What You Must Know BEFORE Becoming a Greedy Landlord. How to build a portfolio of investment properties for an income that lasts a lifetime.

      1. Thank you for reading!

        It’s a great way to hand something other than a lease to the tenant. Mine is in a folder, so the lease and any other papers get put inside. The tenant has a tendency to save the folder in a good spot, rather than just throw the lease in a pile somewhere.

  5. With advanced technology it has become a lot easier to upgrade systems so that one can view all the stats, records and security camera videos without going to the premises of the rented house. Most important thing is to have contacts with the right people and also knowing the prices of different fixes. This helps in saving a lot of money. Most tenants want their fixes to be done without trying to save money as the owner of property will have to pay for it.

  6. Hi There,

    One thing I would like to mention is the issue of language, here in Europe. Managing properties outside of your home country is difficult because all the items you mentioned in addition to language.

    That means tenants, lawyer and tax letters in German, Italian or Swedish! Now that is a challenge! You get used to it after a while, but this adds layers of complexity to it all.

    This is how it is in Europe. We have to live with it.

    For some of us the rental returns for our home countries is too low.


    1. Thank you for reading. Great tip! It would make it difficult to have a tenant that cannot, and is not expected to, speak your language.

      As Steve Martin would say “Those French, They have a different word for everything!”

  7. We’ve gone out of the State a few times with our basement renters. We haven’t had any issues, thankfully, but I always am nervous. I think part of it is that they are in our home so if something goes wrong it means something is going wrong at OUR home, too. I like this tip a lot -> “Tip: When you use a taxi cab to go out of town, the cab driver knows you will be gone. Is he/she also casing the place for a future break in?” I have been hesitant to take a cab or Uber because of this.

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