Property Management and continuous stream of repairs... What would you do?
Investor · Member since 2021 · 1 post · 1 vote
Property Management and continuous stream of repairs... What would you do?
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Property Manager · DE · Member since 2023 · 248 posts · 133 votes
3yYou should be getting invoices for each repair and can call the vendor to make sure they're legitimate. Hopefully they also have an online portal where you can track every ticket and see what the issue is and if it's a recurring issue or not (and if so discuss why) Call the contractors directly to discuss and ask if there is a markup for the management company. If it's in house maintenance then they're making money every time someone goes out. So many investors think this is a good thing (and it can be) but it also allows unscrupulous companies to profit on maintenance.
Reading the contract thoroughly is so important and finding a reputable company. If you think the tenant is reporting things erroneously then tell them not to renew them.
You may need to get an attorney involved.
14 Replies
Quote from @Alain Chautard:
Hi,
I have a property in a different state that I trusted the PM company to take good care of. After two years, I've received 30 maintenance requests from the tenants, which seems like a lot. The PM company happily dispatches repair people every time without questioning much of anything:
- The same repairs seem to happen repeatedly, so can the repairer be trusted, or should something else get fixed first?
- If the house has so many problems, why did the renters happily renew their lease twice already?
In any case, I'm not sure what to do. All the cash flow is eaten by those repairs ($3,000 and counting this year alone), and the PM company has a clause that doesn't allow me to switch to a different company: I'd have to pay them till July 2024 to get rid of them.
What would you do in my situation?
Walk it, see whats going on, If legit repairs, then fix them, and do any preventive maintenance you can,
- Investor · Orange County, CA · Member since 2014 · 363 posts · 408 votes3y
Sorry you're going through this.
Few things popped into my head while reading this.
1. is this an older property? If it's an 80-year-old property I wouldn't be surprised at the excessive repairs.
2. I would create more clear boundaries with the property management company. Any repairs over $x need to be approved by me. Once you spend more than $xxx per year on repairs, all repairs need to be approved by me, etc.
3. I would ask for more details of the repair history. What was fixed, how much did I pay for this repair, and why is the same item being repaired multiple times?
If they know you're looking carefully, they're less likely to engage in funny business.
I'm not sure why you would agree to lock yourself in with them for so long but if things don't turn around you may want to speak with an attorney about how to get it out of the contract, if at all possible
- Property Manager · Denver, CO · Member since 2021 · 667 posts · 587 votes3y
@Alain Chautard What does the management agreement say about how repairs are handled? If it's silent, then I would start by asking the PM their process for handling maintenance requests. If they simply dispatch the handyman or other service provider without any trouble-shooting Q&A with the tenants, then I would find a new PM. Minor repair requests can typically find a free solution if handled by a competent PM. For example, a garage door that won't close is often a misaligned door sensor or closing force setting. A clogged toilet will benefit from the employment of a plunger, etc. Going forward, I would tell the PM that you want to be contacted for pre-approval before any service provider is sent. And double check the pre-approved spend limit and adjust it if possible.
- 3yKim Meredith HamptonBusiness MemberReal Estate Broker · St Petersburg · Member since 2014 · 2k+ posts · 2k+ votes
What kind of condition or age, was the property rehabbed prior to the renter taking occupancy? Sounds like a lot of needed repairs, a maintenance monster or a combination of both!!
Let your PM know what and what you won’t repair from this point forward, and that you want before and after pix from the contractor
- Property Manager · DE · Member since 2023 · 248 posts · 133 votes3y
You should be getting invoices for each repair and can call the vendor to make sure they're legitimate. Hopefully they also have an online portal where you can track every ticket and see what the issue is and if it's a recurring issue or not (and if so discuss why) Call the contractors directly to discuss and ask if there is a markup for the management company. If it's in house maintenance then they're making money every time someone goes out. So many investors think this is a good thing (and it can be) but it also allows unscrupulous companies to profit on maintenance.
Reading the contract thoroughly is so important and finding a reputable company. If you think the tenant is reporting things erroneously then tell them not to renew them.
You may need to get an attorney involved.
- 3yMichael SmytheBusiness MemberReal Estate Agent · Metro Detroit · Member since 2023 · 4k+ posts · 3k+ votes
This sounds like a frustrating problem to chase for landlords & PMCs:(
It takes time to research past maintenance issues to identify repeat issues - that are a servicetech quality problem or a tenant-caused problem.
An owner with only a few properties (and a decent memory) can easily spot these, while a PM/Admin dealing with 100+ properties would need an incredible memory to identify these patterns.
There's an old saying, "You find out more about someone when you see how they respond when things are going wrong, than when things are going right".
So, politely, but firmly bring your concerns to the attention of your PMC. If they have integrity, they will research and update you, taking any necessary responsibility. If they make excuses and don't really do any research, or ignore you -> then it may be time to find a new PMC.
Logical Property Management4.9464 Reviews - Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes3y
Quote from @Alain Chautard:
It would help if you shared specifics. You say, "The same repairs seem to happen repeatedly" so explain what that means. Is the toilet constantly clogging? Could this be a sign of Tenant abuse or neglect?
Maybe you have an old house with a lot of deferred maintenance, worn down systems, old appliances, etc. Some houses take more work than others.
Your PM Agreement should have a limit on what the PM can spend without getting your approval first. This is typically $300 - $500 per work order. If all your maintenance requests are for small things, the PM may not need to get your permission first.
As others have stated, a good PM will provide copies of the invoices so you can see exactly what is going on with the maintenance. Review those closely and see if they are reasonable. If you see repeat repair requests (e.g. sewer line keeps clogging) then maybe you need to work with your PM to investigate the cause and find a permanent fix (e.g. replacing the sewer line).
There are just too many variables for us to give you a specific answer.
The DIY Landlord Book4.7243 Reviews - Honolulu, HI · Member since 2008 · 3k+ posts · 2k+ votes3yAloha,
Quote from @Alain Chautard:
After two years, I've received 30 maintenance requests from the tenants, which seems like a lot. The PM company happily dispatches repair people every time without questioning much of anything:- The same repairs seem to happen repeatedly, so can the repairer be trusted, or should something else get fixed first?
- If the house has so many problems, why did the renters happily renew their lease twice already?
In any case, I'm not sure what to do. All the cash flow is eaten by those repairs ($3,000 and counting this year alone), and the PM company has a clause that doesn't allow me to switch to a different company: I'd have to pay them till July 2024 to get rid of them.
What would you do in my situation?
You state "I've received 30 maintenance requests from the tenants". It sounds like they are contacting you directly, then you notify your PM, who "happily dispatches repair people". Tenants should be contacting PM directly, PM should be asking for details or even photos of the issue from the Tenant, and generally understanding what the issue is before dispatching (realizing that some Tenants are completely clueless and poor communicators). They should also have a record of all work for each unit, and review that record for prior related issues. Honestly, if it is happening this often, any competent PM should remember the prior calls and instantly be questioning the Tenant or the Vendor on what is happening, if not making a personal visit to get eyes on.
Either the repair person is doing a quick "patch" job, that will never last, rather than a proper repair; or the Tenant is causing some/all of the issues and should be charged the full cost of repairs. The PM should be determining responsibility with each service call, based on report/notes included with invoice from the Vendor. For many types of service calls, we require before/after pics from the Vendors while on site. Those contractors always have my personal cell number to reach me directly from site and to send pics instantly for discussion or approval. Those pics are transferred to the unit file to maintain a complete record.You should be receiving a copy of every invoice with at least enough detail to determine what, exactly, was done. Sometimes, there may be multiple different "symptoms", but all result from the same underlying problem. Perhaps the Vendor is not adequately troubleshooting; or, in many cases, they only perform a pretty specific task they were sent to do, without opening their eyes and looking at the bigger picture. This ensures additional service calls...
I imagine the Tenants remain because either they have low standards; extraordinary patience, or they are well under market rates.
- Rental Property Investor · Orange County, CA · Member since 2016 · 740 posts · 529 votes3y
This is very frustrating. Why are the repairs so high? Who is doing the work, and is it warrantied? I would get quotes outside of your PM, you should be allowed this. Also the PM should NOT be sending out dispatch repairs like that- that is a big red flag. I would request a walk through with a handyman and see what is actually going on.
Did the PM do a walk through before tenants moved in?
This is definitely a red flag and very unusual. If the tenants are causing the issues - they need to pay for those bills. You are only suppose to pay for items that are not caused by the tenants. Example: if they broke the curtain rod because they pulled too hard. That is on them, not you. But if the curtain rod was put in really cheaply and wrong- then you should pay for it. That is why initial walk throughs and inspections are very important. - Property Manager · Ketchum, ID · Member since 2016 · 277 posts · 132 votes3yI would suggest that you look into this right away. You need to request reports for each repair and I would even ask for photos to be taken by the repair person and sent to the property management company who can then forward them to you. I would ask for copies of the requests for repair from the tenant. I say this because when I had a property manager manage my mulitple duplexes, he was doing repairs on his own properties and charging them to me. The other thing that happened was that he would replace damaged flooring with flooring that was a different color and type even if it was just a patch. I would make a trip over to your property and arrange an in person meeting with the manager. Have them take you through the property and point out where repairs were done. This can be a serious breach of your contract if there are contractual descriptions of how repairs are to be handled. And yes, I fired my property manager and managed them myself from then on. (it was not worth it to sue for damages). As a result of this action, my vacancies almost vanished and the repairs that needed to be done were done quickly and well. And yes all of my properties were out of state.
- Investor · Castaic, CA · Member since 2015 · 79 posts · 16 votes3yI kind of have the other side of that. My current PM sends me quotes for major work orders to approve with no $ estimate. Then they move in a new tenant when there is no water heater and furnace in the house and numerous other issues that are appalling. So, there needs to be a balance.
Quote from @Alain Chautard:
Hi,
I have a property in a different state that I trusted the PM company to take good care of. After two years, I've received 30 maintenance requests from the tenants, which seems like a lot. The PM company happily dispatches repair people every time without questioning much of anything:
- The same repairs seem to happen repeatedly, so can the repairer be trusted, or should something else get fixed first?
- If the house has so many problems, why did the renters happily renew their lease twice already?
In any case, I'm not sure what to do. All the cash flow is eaten by those repairs ($3,000 and counting this year alone), and the PM company has a clause that doesn't allow me to switch to a different company: I'd have to pay them till July 2024 to get rid of them.
What would you do in my situation?
More details are needed. They could be warranted if the house is not in so great of shape or has real issues.....or it could be a PM that jumps every time the tenant says "jump" because they make $$ for every service call. So the tenant calls for every tiny thing and the PM says "ok" since its not their expense and they make $$ off it.
So you need to get more detail from the PM...more details on what was "fixed"...when.... why... how much etc etc. Then you can at least see a pattern to determine if its legit or you are getting screwed.
- 3yMelanie ThomasBusiness MemberReal Estate Broker · San Antonio · Member since 2022 · 1k+ posts · 491 votes
I recommend asking additional questions. Engage in a conversation with your property manager, request copies of invoices to gain a better understanding of the repair requests. Determine whether these repairs were primarily cosmetic in nature or other. Also, inquire with the property manager about their policies regarding tenant chargebacks. Effective communication plays a pivotal role in this situation. Good luck & happy investing!
RentWerx Property Management4.73215 Reviews
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