Managing my property manager
Hello,
I have a question about how to go about managing my property manager. The first property I bought was a four unit building located in a rougher area of Milwaukee (not extremely horrible). Going into it, I knew there was going to be a lot more trouble than what a typical property might have. More difficult tenants means more repairs which decrease NOI.
This past year I decided to get a property manager to take it off my hands (I handled it for about 9-12 months before it started bumping up with my work schedule). I'll be honest, I don't know what a good property manager is supposed to look like. After reviewing my numbers for 2014 (in light of tax season), I see that I am about breaking even from a cash flow stand point. It looks like I received 26K in rent (23.9K after management fees), however repairs and maintenance was 16K! I realize that this includes basically turning over each unit (new carpet in some, paint, 1 set of new appliances, etc) but I still find that number to be very high. After taxes, water, common electric, and insurance it was about cash flow even.
My question is how do I go about letting my manager know this number will not be acceptable for 2015? Do I start looking at new property managers (I've only had the one)? My biggest concern is getting tenants to pay rent (difficult in the area in general) and keeping expenses low (which I would think has to do with the tenants), any ideas how to accomplish this? Should that question be put on my PM's shoulders?
As always, I appreciate any and all feedback!