Property Management Company for Memphis Investors

13 Replies

Hello, I'm currently investing Memphis area from California. 

I have two PM companies in my mind to take care of my properties but one charges 50% of first month and other one charges 100%.

What's normal rate for first month?

one of my property can rent out $1850 and paying 100% of rent for the first month seems like too much.

If you know any good PM company that you are using in Memphis area, please let me know and I'd love to connect with them!

also, if you are in Los angeles area and investing in Memphis or any state out of California, please let me know I'd love to connect, buy you a lunch or coffee!

Thanks

Besides focusing on price, how many questions did you ask each of these PMC's about what services they provide and HOW they execute those services?

Don't be foolish and assume they both do everything the same way!

Promotion
BiggerPockets
The one-stop-shop for REI
Find Local Home Improvement Pros!
Check out our network of trusted, local contractors for all of your home improvement projects.
Find a Contractor
Originally posted by @Drew Sygit:

Besides focusing on price, how many questions did you ask each of these PMC's about what services they provide and HOW they execute those services?

Don't be foolish and assume they both do everything the same way!

I asked lots of other questions and I liked both, maybe the one charging 100% little bit more.
I just wasn’t sure if 100% is industry standard.


What would be your best question when it comes to figuring out if they are the good one

@Jimmy Shin I don't know how many properties you have but at that price point the tenants should be very easy to manage. I would recommend using a virtual assistant to manage it yourself. I own five rentals in Memphis and that's what I do. It costs $75 per month per unit and the VA knows the market and the business. Write me if you want more info.

@Jimmy Shin

Hey Jimmy,

I've been invested in the Memphis market since 2017. I've fired more PMs than most people have hired. I would not want to bash anyone in public but feel free to message me.

Originally posted by @Jimmy Shin:

Hello, I'm currently investing Memphis area from California. 

I have two PM companies in my mind to take care of my properties but one charges 50% of first month and other one charges 100%.

What's normal rate for first month?

one of my property can rent out $1850 and paying 100% of rent for the first month seems like too much.

If you know any good PM company that you are using in Memphis area, please let me know and I'd love to connect with them!

also, if you are in Los angeles area and investing in Memphis or any state out of California, please let me know I'd love to connect, buy you a lunch or coffee!

Thanks

Jimmy,

Love that last line in your post. I think that is a step that many investors miss - especially when investing out of state. There are many investors right there in your area, and I know LA is big, but there are a lot. There are a few REIA groups from big to small in that area and many, many investors who are investing out of state. Best of luck with your offer out there because simple connections can often lead to big things!

As for the question on property management, here is the advice I give investors to look at and much of it relates to your risk tolerance.

It is not always true that you get what you pay for.  But it is true more often than not.  Same goes for paying more.  Just because something is more expensive does not mean it is better.  But we are not taking about a product here.  We are talking about service and one thing holds true in service, cheaper costs limit the ability of the service provider to perform.  

Placement fees will almost always be the leading revenue producer at a management company.  This is my opinion from having mentored and masterminded with a lot of management companies, but the best in the business have extensive teams and pay them well.  A first month's fee will often encompass a payment to a rental agent, marketing fees, any additional team member costs to handle all of the details to ensure a successful onboarding of a resident (most will call renters a tenant), smooth closing and over-all happy resident moving forward.  

There are plenty of companies out there that charge lower fees.  I am sure many are excellent as well.  Just as I know many companies that charge a full month's fee, but are not the best operators so their teams may not be efficient or especially good at what they do.

So, your big question for management companies is going to be how are you going to deliver your services?  What should my minimum expectations be and can you let me talk to some owners who will verify those results?  Then you measure that back against the costs.  Anyone can give you data and numbers and there will always be operators who will tell you what you want to hear.  What you need to figure out is, if a company that charges a full month can keep a property occupied on average for longer periods of time than the lower costs companies, you will actually make more money with the higher priced company. Their value will be apparent to you.  The best way you are going to figure that out is to ask actual clients and ask the companies to provide you with at least one person who had an issue with them so you can figure out how they deal with problems.

Hopefully that helped a little bit.   Best of luck as you get going!

Promotion
Apartments.com
List, Screen, Lease, Get Paid, Manage.
No Better Place to Lease Your Place
Owners rely on the #1 rental site to get the best results from their rental properties.
Get Started Now