I have always managed my own properties. We are relocating out of state and I would like to put a property manager in place.
Interested in knowing what your strategy, questions you have asked, and general approach you have used to source the 'right' property manager.
I would first say that you want to make sure your goals are the aligned with your management companies goals. and that the expectations are very clear and set from the beginning . I have seen many business deals and relationships go south all due to not having clear expectations of performance and lack of communication on both parties. You as an owner need to know what your role is and what the PM company expects of you and most definitely vice versa and what are their deliverables.
When you want to make sure that your business goals align you have to ask the tough questions and see how well they run their business and how well do they know their numbers. Below are some questions I would think would be a good starting point for you to see who really treats their company like a business or a hobby and it will give you a good indication of how they are running their business... If they cannot answer these questions that could be a red flag to either dig deeper thru references or keep searching
- What to Look for in a Property Management Company
- I would look up NARPM and start with them...
- make sure their business model aligns with yours
- Be relationship not transactional
- its a people business
- Questions to Ask prospective management companies
- What are your average days on market for vacant homes?
- What is your average rent amount for all properties managed?
- What is your average work order cost for the owner?
- What is your average make ready cost for the owner?
- Are all my invoices uploaded to my owner portal?
- How do you advertise your vacant units?
- Do I receive video of my pre and post make ready?
- Do you have a setup fee?
- Do you upcharge on maintenance?
- When do you make owner payments? How often?
- Are you a Certified Property Manager?
- Are you a member of NARPM?
- What is your Guarantee?
- Do you provide move in and move out reports
- How many pictures do you take of the property prior to tenant moves in and after the tenant moves out
- Do you get weekly reports when the property is vacant what prospective tenants are saying about your home
- Do you provide monthly newsletters to your tenants
- Do you hold investor education classes to help me become a better investor
- Do you have single point portfolio based management services?
- How many properties do the owners actually own themselves?
- What do you do to ensure that the tenant is responsible for security deposit disputes since that is the largest reason for owner lawsuits
- How familiar are you with the newly changed laws that can affect you the owner if they are not used correctly?
Good luck and happy hunting!!!
A lot of the questions put forward are great questions to ask. I notice a lot of investors look at the rate first before they understand what they are getting with the rate quoted. Understanding that the property manager is suppose to take care of the property and not just collect rent (a lot of LL's think that it's just that ). Other things I would add is
1. How many inspections are done per year.
2.explanation of how the screening process is done and what they look for.
3. Do they do drive by's on the property monthly.
Have them also explain the eviction process to you and how they handle it. Are they using legal counsel or doing it they self ? ( their specialized skills are in management not law so they should have legal counsel access for all issues that may come up)
In regards to screening and how quickly they fill up properties these can go hand in hand. Do they only just look at 3x rent and decent backgrounds to add them to the property or do they have a detailed screening process to make sure that when they get in your property they can pay the rent? I know that no one can tell the future of a tenant but the process they have in place to help their crystal ball would be a focus.
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