As I write, my entire team are converging on Panama City from around the world for The Gathering XII—the annual meet-up for Lifetime members of my Real Estate Trend Alert (RETA) club starting this Thursday.
The Gathering isn’t a conference or seminar. It’s small, intimate event designed so RETA members get plenty of facetime with me, my team, and the top-class developers, attorneys, and other insiders in my rolodex.
Later this week, I’ll be sharing a lot more about The Gathering and what I’ve got lined up for this year’s edition…
But before The Gathering kicks off, I want to wrap up something that’s been on my mind—that’s sharing my strategy for how to find an excellent rental manager.
If you’ve been following me recently, you’ll know that in February I took delivery of two new condos in Cabo, at the southern tip of the Baja California peninsula.
They’re in the Monte Rocella community, perched on the hills of El Tezal.
RETA photographer Noah Duethman just sent me these shots from Monte Rocella, a community on El Tezel in Los Cabos where I brought members of my Real Estate Trend Alert group an incredible off-market deal. I’ve just taken delivery of two condos I bought in this deal.
The views from Monte Rocella are awe-inspiring. From the infinity pool, sun deck and other amenities, you look straight out to the glittering Sea of Cortez and the famed Arch rock formation.
Back in May 2022, I brought RETA members an exclusive off-market opportunity to buy in this best-in-class community.
RETA members have already seen six-figure uplifts on this deal. The developer shared a current price list with my team, and a two-bed ocean-view condo in Monte Rocella that had a RETA-only price of $262,800 is now listed at $429,000—that’s $166,200 more.
Since I’ve been sharing news about my two new condos, and how I plan to rent them for income, I’ve received a number of questions from readers—including how to find a reliable rental manager.
Today I want to share my guide to finding a good one. That’s below.
And stay tuned…I’ll also be bringing you lots of boots-on-the-ground scouting from Panama, along with insights from The Gathering, in the days ahead.
Will Robinson from the developer’s team gives me a tour of my two new condos in the Monte Rocella community in Los Cabos.
How to Find a Good Rental Manager
When I hand the keys of one of my properties to a rental manager I want to make good money, and I want zero problems.
So how do you achieve that?
Well, like many things in life and business, find the right people and you’ve found your answer.
I view getting the right rental manager as very similar to appointing an attorney. It’s an “appointment.”
I place a lot of value on recommendations from competent people. Good old-fashioned word-of-mouth way is still best in my opinion.
And no matter what, once I have a manager in place I want full visibility on the rental calendar and bookings. A good rental manager wants this too! Transparency saves everyone time and removes any doubt about what’s happening with your property.
One thing tops the list for me when searching for a rental manager: Be numbers oriented.
The metrics matter most. Focus on these. It’s easy for any of us to get friendly with the vendors.
But be pragmatic. Rental management is a challenging business. Not everyone has the chops to excel at it.
Have clear expectations.
Then, interview potential managers.
The Monte Rocella community has a genuine resort feel, with incredible amenities like an infinity-edge pool, swim-up bar, jacuzzi, fire pits, gym, and yoga deck—plus mesmerizing views…
You need someone you’re comfortable with.
If you ask your rental manager a question, you want to get answers. If someone isn’t able to give you clear answers, that’s a red flag.
In my early days working with rental managers, I made some big mistakes. I used the services of incompetent and even downright dishonest rental managers.
Today after hard-learned lessons I see it as my responsibility to help them. To push a bit, to coerce…to incentivize. And to fire them fast if it’s not working out. A few warning signs and it’s adios from me.
Here are some of my top tips for sizing up a rental manager…
Get Recommendations
Ask anyone who’s done business with the rental manager what the experience was like. Are they happy with how it panned out…or disappointed? You want a quiet word…people will tell you things they would be reluctant to put in writing.
Next, go online and do an internet search. Search for similar homes to yours in the same area and see if a certain name comes up again and again. You might find a rental management company with a website that’s in the top three that shows up…or a manager who’s working all the vacation rental sites.
That web presence is crucial. It’s the way to get your home out there, in the face of potential renters, and keep a steady stream of visitors coming through your door.
See if the manager makes the real estate on their books appealing. Are there nice photos? Good descriptions? Would they make you want to stay there?
Do an online search for negative reviews, or unhappy customers. They’ll often post outside the rental platform, on social media sites or forums. If you find any, and you notice a common thread, it’s a red flag.
Check their Rates!
In 2008, Panama City’s historic district, Casco Viejo, was starting to emerge as a tourist destination. (Today, it’s a big tourist attraction and hipster haven.) In 2008, it was still sketchy…rough around the edges…but its mix of narrow brick-paved streets, colonial homes, quaint churches and little plazas had a definite appeal.
A friend bought a small one-bed condo in a historic building. It had a couple of bonus features: views over a leafy plaza with restaurants and cafés, and a rooftop swimming pool (a real novelty in Casco Viejo at that time).
She already owned an apartment in Casco and this purchase was pure investment. She wanted to rent it out short-term and have an income stream.
One thing she was sure of: she did not want to manage it herself. She was already running her own successful business, and she traveled frequently to meet clients and host workshops.
She told me that she had narrowed the list of potential rental managers down to two. One charged 25% of the gross rental income. The other, a boutique agency, charged 40%.
Casco Viejo, Panama City’s historic district is packed with chic bars and restaurants catering to an international crowd who reside, visit and enjoy the city.
Outraged by the 40% fee, she went with the cheaper-rate manager. Twelve months on, she realized it was a huge mistake.
Her net was $9,000. But talking to a neighbor in the same building with an almost-identical unit to hers, she discovered they had made $22,000 net in the same period—more than double her rental income. And, they had used the 40% manager.
The difference was occupancy rate and rental fee per night. The 40% manager got more guests…and charged more per night.
The 40% manager focused exclusively on Casco Viejo (unlike the 25% manager, who covered the whole of Panama City). Do a google search for Casco Viejo at the time and the 40% manager’s name would pop up, either in a paid ad…or in a feature article in a prominent U.S. newspaper…or via their own in-house blog on Casco. They targeted well-heeled tourists. All that extra work they did paid off for their clients in the form of higher occupancy and more rental income.
Can You Stay on Top of Income?
Find a rental manager with a good reporting system. It has to be online so you can log in and see at the touch of a button the big metrics like how many nights booked, how much income you’ve made, what bills were paid.
You will usually need accurate and official records of income for tax purposes, so it’s important your rental manager stays on top of reporting.
So…
Getting recommendations, checking the manager’s rates, and finding a manager with sound reporting are three of my top tips for sizing up a rental manager…
I share six more in my full article on this topic. RETA members can read it now.
Wishing you good real estate investing,
P.S. As I say, I’ll have much to report from The Gathering XII in Panama City in the coming days. I look forward to meeting with the lucky RETA members who managed to get a seat. They’ll be hearing from my trusted contacts, receiving expert advice, and hearing about incredible opportunities around the world. More on that soon.
Last year’s event, The Gathering XI, took place at the luxurious Grand Hyatt hotel in the booming Caribbean coastal city of Playa del Carmen.
