In our last post we discussed residential leases and how to go about creating a solid one.
However, if you are going to hire property management this is something they should have for you. With that said, let’s discuss what a good property manager should provide and how to go about finding a quality management company.
Finding Good Property Management
There are several questions you will want to ask any property manager you inquire about. These questions are important so you know what you are getting for the service and how everything is handled from communication to filling vacancies.
First things first – Call atleast three property management companies in your area. This no different than getting multiples estimates from contractors on a big job. How can you know if you are getting a good deal or quality service if you don’t know what the market provides.
Questions to ask while vetting property managers
- What are all your Fees
We want to know everything from the percentage of rent they charge for their service to any additional fees for specific actions.
- How much do they charge to place a tenant?
- Is there an additional fee when they need to schedule a maintenance repair?
- Is there a fee when transferring or paying out the rental income to you?
- Do they charge a fee for posting late notices to tenants?
- What is the cost if they need to evict a tenant?
- Is there any kind of annual renewal fee?
These are questions you should be asking along with anything else you feel you’d like to know.
Be Clear On What the Monthly Fee Gets You
Makes sure they clearly tell you the specific services the monthly fee provides. This can fluctuation from company to company depending on the additional fees they have broken out.
Discuss the Cost Threshold For Repairs
You don’t want the property manager calling you every time there is a minor repair. Ultimately you decide what that dollar threshold is for when the manager should reach out to you, but ask them what amount they generally use to see what they say.
Personally, I have a $200 threshold. If a repair will cost less than that amount than I do not want to be bothered with a phone call. I mean, the main point of having property management is so someone else is dealing with the tenant calls and maintenance.
How do they contact you and/or the tenant?
- Is it direct phone calls or emails?
- Do they have a website where all info, communications and documents go?
- Are tenants able to contact the management company 24/7 with maintenance issues?
That last one is important because if something unfortunate happens during the middle of the night, for instance a busted pipe or water line you don’t want extended damage being done because management isn’t available to ensure the tenant shut off the water and/or knows how to.
How do they go about advertising your property to fill the vacancy.
- Where outlets are they advertising your property?
- Do they work with any local real estate agents or have in-house agents?
Last, but not least….
How does the relationship end if we no longer want to retain their management services
- Is it tied to the lease of the given property or is it based on when you additional hired them to find a tenant for your property?
Be clear on this because you will want a smooth transition if and when you decided to make a switch or self manager.
Conclusion
Remember, the more you know upfront the less potential surprises you can get down the road. So don’t be afraid to ask them as many questions as you like.
When you do decide on a property management company be sure to ask for a copy of the lease they will use for your property. If there are particular items you are not clear on or feel may be missing for your level of comfort, then discuss that with them too.
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