I’m looking into my first small multifamily investment home and I would like to have this ran and managed by a professional PM group.
1) What’s 2-3 main questions you ask when
you’re interviewing for a PM?
2) Are there any “zero tolerance” red flags that make you walk away immediately?
I would ask about their systems for leasing and maintenance issues. Those two things can tell you A LOT about a PM group. Ask for addresses of properties they are currently leasing and look at the ads. I have an investor that was having issues getting his property rented out and I started looking into it and the PM never posted pics or descriptions on his rental listing.
Also find out if they charge a mark-up on repairs or is that included as part of the monthly fee? Find out what the leasing fees are and whether they charge for renewals or not.
I'm super happy to my PM that I use for my out of state rental. I pay 10% monthly and then 50% of the monthly rent for new lease signings. No charge for renewals, no mark-ups on any repairs. They have a 24/7 emergency maintenance team. And all maintenance calls have a max turn-around time of 24 hours. They are also super prompt with getting renewals and leases signed which is surprisingly not the case everywhere. Those are the kinds of things that I am looking for in a PM group.
Before any questions, research the online reputation of each PM company. Truly read the reviews, and definitely the company response if any. A 1-star review isn't the end of the world, but if you see a pattern of hostile or arrogant responses from the PM company, well....
1) Do you, or the owners of the PM company, own multi-family rental property?
2) Does your company markup or profit in anyway from maintenance?
3) Will I be assigned a PM, or is your company a team with multiple contacts for me?
4) If they don't have a FAQ section on their website, ask them about their MO with maintenance, tenant rental criteria, etc.
And make sure to properly review their termination clause in the PM agreement.
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