I am having problems with my Property Manager. He has not been providing the owner statements and has not deposited the rent in my account despite number of emails and phone calls. He seems to be avoiding direct questions about the payment of rent.
As an example, he did some rehab on one of my properties. We agreed that he can hold the rent from 2 of my other properties to pay for the rehab cost. According to my calculations, the rent adjustment paid for rehab in July and since late July, I have been chasing him to provide a reconciliation report so that we can agree on how much he owes me.
I am ready to move the properties to another Property Manager but would like to understand what options I have available to make him pay the outstanding rent to me. I know I can take the legal route but it will be expensive and time consuming. There are a few other overseas investors who are having the same issues.
Any assistance/advice will be greatly appreciated.
We have excellent management in Memphis, (not our own company) and can help with recovery. PM or email me if we can help.
WOW!!! That is terrible!! Unfortunately going the legal route will be the most expensive route. Do you have a contract in place with him as well and provisions that he may have you stand by in breaking the property management agreement? Could be a sticky situation for the new PM....
I would give your property manager a deadline, and also call their principal broker or the owner of the company and speak with them about the lack of performance of your property manager. If your property manager owns the company then you really need to physically go to your properties and look at them. Ask your tenants when they paid their rent and how much. Ask if they have copies of checks or money orders, or even reciepts from their property manager. Also I would suggest that you go back home and type out exactly what they tell you and have them sign it.
Once you establish you have money owed, you contact your property manager and state approximate cost of how much is owed, and request all your receipts and copies of any bills which includes rehab costs... At that point you let them know if they don't provide it to you by a definite date you will be either taking court action, or filing with your real estate board a complaint.
If you get the receipts you need to go through them and figure out your final numbers and if it is off by 1 penny, then as far as I am concerned you have every right to go after them legally, or through a professional board.
If you don't get the receipts/not owner statement, (owner statement is only going to give you what the costs were, not what was completed) definitely take court action, or professional board action.
Bottom line, you need to change property management companies because the trust has been broken by not preforming his/her job by providing you a monthly accounting of where your money goes. As an owner, I do understand it the owner statement is later than normal, but not to have some set of accounting in a month here in VA is illegal, and is punishable by board action.
I have a new owner that came to me July 1, and has a 12 unit apartment building and said my property manager is not doing anything to help me or my building. When I actually started looking at the financials I realized only 4 of the 12 were rented.... It is a shame the owner didn't step in 6-7 months before because he had a negative $3800 a month.
I took over managing the property on July 15, 2014, I had to make the building visible again , overgrown shrubbery had made the property very hard to even see, I have had to put 4 apartments in rentable shape( as of yesterday), and I have one the one that was more rented for a total of 5. Also the second day we were managing the property we got a phone call from one of the tenants saying they had a notice that the water was going to be turned off due to non payment of bill, The bill was over $1400... The owner hadn't seen any bills or owners statement and he couldn't tell you where the money went, all he knew is he hd to overnight us the funds (he is out of town), to keep the water turned on for the tenants.
I also reviewed his budget. I found out my owner was paying too much for water. what I mean is for only 4 apartment you should not have a $600 water bill, I found 3 of the 4 rented apartments had toilets leaking, and the worst part they reported the leaks to the old property manager and nothing was ever done about it. I went ahead and took it further and looked at the trash dumpster and for a 16yd dumpster my owner was paying $294.00 per month. I had him cancel the contract with that waster provider and move over to a company that I do lots of business and negotiated his rate to $110 a month for the same weekly services.
To make a very long short sometimes owners let things go to long with a property manager because they don't know what else they should do, but you might be making the problem worse by not moving quickly and getting new management.
Also at any time if you feel like your manager is not providing you the service you think is necessary, you need to make your feelings known. If you want something above and beyond what is laid out in your property management agreement then obviously they will not accommodate, but if the services detailed in your property management agreement are not meet you need to let them know and have them correct the deficiencies.
Sunny, can you say the name of the property management company in Memphis. I know someone local who may be able to help.
I would love to know the name of the company as well????
@Dean Letfus , @Derrick Craig , @Curt Davis , @Lisa Doud , @Thomas Merrifield - Thanks to you all for responding to my post. I have sent private messages to Dean and Derrick. I am reluctant to provide the name of the property management company as I do not believe naming and shaming them on a public forum like this will not do anyone any good.
I have also contacted couple of other Property Managers I met on my last trip to Memphis earlier this year. One of the key concerns for me is recovery of the outstanding rent from the current Property Manager without being involved in lengthy legal battles.
sunny, no one is looking to blast this mgmt company. By naming them you are giving other investors a heads up and potentially helping others avoid the same situation. Understand also that neither of the two people you messages are going to be able to actually help you recover your funds. Not telling who they are puts other people at risk.
Amen to the @Curt Davis
@Sunny Gupta as we discussed a few months ago have a team that works together and is accountable to each other is the key to success. I hope you got the matter resolved.
One other thing to remember is paying more for PM makes a difference
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