Issues with a Property Management Company

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Issues with a Property Management Company

Mary Jay
Glendale, AZ · Member since 2017 · 1k+ posts · 238 votes

Hi guys,

Ive been getting comments in my topics to hire a property management

Ive had a really bad experience with the property management companies that I had. 

In both situations I inherited property management company because I purchased with tenants. 

In first case the tenant moved out and there were gums on the carpet and drawings on the walls. Thats about 5K in damages. The property management company wanted to return back to the tenant half of their security deposit (which was 1K and they wanted to return $500) and I had to tell them it was not fair, I need to keep the full security deposit so we settled on me getting the $800 and the tenant getting 200$)

The second property, when the tenants moved out there was dog poop on the carpet and obviously bad smell, and some ripped carpet in a couple of places. Then there was a trash (furniture, matrasses)  that were left outside for one month and I did not know about it. The way I discovered it is I flew to Florida from Arizona and saw it and then met the neighbors who said that the trash was there for one month. The property manager did not tell me anything about the bulk trash, and had I not gone there the city probably would of penalized me for the trash...

Anyway, in both cases it was the biggest property management company in Florida called Watson

Disclaimer: Ive never worked with any of the property managers who are on this forum.

However, I would really like to get some recommendations on some property management companies that are checked by you guys

1) I have a property in Titusville Florida (I have one recommended property management company but open to more suggestions)

2) Palm Coast Florida

3) will be moving out of Arizona soon, so will need to find a property management company in Phoenix

I hate dealing with handymen/contractors so if you have property management companies who deal with those that would be great.

Please guys, give me the names of the companies you have used and liked.

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Nathan GesnerBusiness Member
Moderator
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
4y
Property Managers are like Tenants: there are a lot of bad ones out there so you need to learn what a good one looks like, then screen them until you find a good one.

Remember: cheaper doesn't mean you'll make more money.

Start by going to www.narpm.org to search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start. You can also search Google and read reviews. Regardless of how you find them, try to interview at least three managers.

1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their staff qualifications.

2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.

3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate, particularly if you have a lot of rentals.

4. Review their lease agreement and addenda. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.

5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance, late rent, evictions, turnover, etc. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that policies are enforced equally and fairly by their entire staff.

6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact that a tenant is complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.

7. Look at their marketing strategy. Are they doing everything they can to expose properties to the widest possible market? Are their listings detailed with good quality photos? Can they prove how long it takes to rent a vacant property?

This isn't inclusive but should give you a good start. If you have specific questions about property management, I'll be happy to help!
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  • Brad S.
    Investor · Pasadena, CA · Member since 2017 · 613 posts · 523 votes
    4y

    We have been using these guys for the Phoenix area, for over 10 years, and are happy with them. They handle everything, including the "make-ready" and other construction work, as needed. 
    S&S Southwestern Management  *  (623)882-0937

    As far as Florida, I would go to NARPM.org and search for local PMs with the proper designation/s and then call and ask them if they handle your area. You can also go online and find good questions to ask a prospective PM. Then ask them for 3-5 references (current or past clients-landlords) and call all of them and ask their opinions of the PM.

    I have found good PM's this way, including S&S

    Good luck

    0Reply
  • Joseph BeilkeBusiness Member
    Real Estate Agent · Palm Coast, FL · Member since 2018 · 364 posts · 244 votes
    4y

    @Mary Jay

    I'll sending you a DM

    240-676-4927
    Enkore Real Estate & Property Management4.836 Reviews
    WebsiteView Page
    0Reply
  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    4y
    Property Managers are like Tenants: there are a lot of bad ones out there so you need to learn what a good one looks like, then screen them until you find a good one.

    Remember: cheaper doesn't mean you'll make more money.

    Start by going to www.narpm.org to search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start. You can also search Google and read reviews. Regardless of how you find them, try to interview at least three managers.

    1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their staff qualifications.

    2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.

    3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate, particularly if you have a lot of rentals.

    4. Review their lease agreement and addenda. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.

    5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance, late rent, evictions, turnover, etc. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that policies are enforced equally and fairly by their entire staff.

    6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact that a tenant is complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.

    7. Look at their marketing strategy. Are they doing everything they can to expose properties to the widest possible market? Are their listings detailed with good quality photos? Can they prove how long it takes to rent a vacant property?

    This isn't inclusive but should give you a good start. If you have specific questions about property management, I'll be happy to help!
    The DIY Landlord Book4.7244 Reviews
    WebsiteView Page
    1Reply
  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 13k+ posts · 9k+ votes
    4y

    @Mary Jay Sounds like you didn't properly screen these PMC's before working with them! 

    In our experience, the #1 mistake owners make when selecting a Property Management Company (PMC) is ASSUMING instead of CONFIRMING.

    It's often a case of not doing enough research, as they don't know what they don't know!

    Owners mistakenly ASSUME all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY, so price is the only differentiator.

    So, the first question they usually ask a PMC is about fees - instead of asking about services and HOW those services are executed.

    EXAMPLE: PMC states they will handle tenant screening – what does that specifically mean? What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.? You’d be shocked by how little actual screening many PMC’s do!

    This also leads owners to ASSUME simpler is better when it comes to management contracts.

    The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it!

    We have a 14-page management contract that we've added our real experiences to over the years, with the intent of protecting both us AND the landlord. Beyond the Monthly Management, Placement & Maintenance fees, all other fees in our contract are IF EVENT -> THEN fees.

    We don’t know any PMCs to recommend in the area mentioned, but since selecting the wrong PMC is usually more harmful than selecting a bad tenant, you might want to read our series about “How to Screen a PMC Better than a Tenant”:

    https://www.biggerpockets.com/member-blogs/3094/91877-how-to-screen-a-pmc-better-than-a-tenant-part-1-services-and-processes

    We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

    EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

    P.S. If you just hire the cheapest or first PMC you speak with and it turns into a bad experience, please don’t assume ALL PMC’s are bad and start trashing PMC’s in general. Take ownership of your mistake and learn to do the proper due diligence recommended above😊

    [email protected]248-209-6824
    Logical Property Management4.9462 Reviews
    WebsiteView Page
    0Reply
  • Mary Jay
    OP
    Glendale, AZ · Member since 2017 · 1k+ posts · 238 votes
    4y

    thank you guys!

    0Reply
  • Chad McMahan
    Residential Real Estate Broker · Sedona, AZ · Member since 2017 · 754 posts · 504 votes
    4y
    Quote from @Nathan Gesner:
    Property Managers are like Tenants: there are a lot of bad ones out there so you need to learn what a good one looks like, then screen them until you find a good one.

    Remember: cheaper doesn't mean you'll make more money.

    Start by going to www.narpm.org to search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start. You can also search Google and read reviews. Regardless of how you find them, try to interview at least three managers.

    1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their staff qualifications.

    2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.

    3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate, particularly if you have a lot of rentals.

    4. Review their lease agreement and addenda. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.

    5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance, late rent, evictions, turnover, etc. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that policies are enforced equally and fairly by their entire staff.

    6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact that a tenant is complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.

    7. Look at their marketing strategy. Are they doing everything they can to expose properties to the widest possible market? Are their listings detailed with good quality photos? Can they prove how long it takes to rent a vacant property?

    This isn't inclusive but should give you a good start. If you have specific questions about property management, I'll be happy to help!
    Agreed.
    I'd also like to add that most expensive is not the best, either. It comes down to what they consistently offer and what their track record is. The most expensive PM in my area is getting tons of complaints, because they are so corporate and not working toward the owners' best interests (Maxed gross annual income, top property performance and minimal expenses).
    0Reply
  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    4y
    Quote from @Chad McMahan:

    Of course! The important part to remember is that Landlords need to do their research and screen potential managers.


    The DIY Landlord Book4.7244 Reviews
    WebsiteView Page
    0Reply
  • Chad McMahan
    Residential Real Estate Broker · Sedona, AZ · Member since 2017 · 754 posts · 504 votes
    4y
    Quote from @Nathan Gesner:
    Quote from @Chad McMahan:

    Of course! The important part to remember is that Landlords need to do their research and screen potential managers.


    I 100% agree, Nathan.
    0Reply
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