Hi, I'm looking for some other opinions on this situation we (my wife and I) have found ourselves in.
We discovered BiggerPockets just under a year ago and have been steadily listening to every podcast. We were inspired to rent our first home instead of sell it.
So, it has taken us a long time to get this point, but we decided start with a Property Management company. The one we found was very professional, seemed to have experience in the area. They met us at the property, had a bunch of suggestions and ideas, we had already spent a big sum before we even spoke to them in renovations preparing for rental and hit our budget and asked them to start the search.
They found a tenant who was willing to move in. The tenant asked for a 10% rent reduction for the first year in exchange for handling some of the unfinished work, which is fine for us, (it would still be cash flow positive). On the lease signing day, the PM company said the tenant didn't show up, which we just viewed as an opportunity to continue to work on the house and no big deal.
Then, we get a call out of the blue directly from the potential tenant who made a really strong case about how they'd be a great tenant, how much they loved the property and wanted to be there long term - it was close to many excellent public schools (walking distance to a great K-5), but they really had a huge problem with the responsiveness and communication of the Property Manager and felt that they blew the deal by not showing up at other agreed upon times and just general flakiness.
The thing is, this is our first rental and we don't know what to expect from the Property Management company, but the criticism on the responsiveness and availability does ring true for us, many emails have gone unanswered (we've had better luck on the phone). Maybe I'm expecting too much in terms of response to emails, ideally I'd like to see all emails answered in less than one business day, but my expectation could be too high and I just don't know. That being said, the PM did do their job of screening and finding a tenant.
On one hand, I think it's a salvageable situation. The PM should obviously be motivated to do a good job and I'm sure will work to resolve any issues, if not, then they would lose our business. The tenant and us, as the owners, have a longer term stake in it - am I looking at it incorrectly?
I don't just want to jump to any conclusions. I'd love to hear some more experienced buy and hold people weigh in on this.
Thank you guys!
Hard to say who to believe, did the PM lie and not meet the tenant? Did the tenant lie and flake on the meeting? Or was it just a miscommunication (which I would blame on the PM, because that's their main job).
If you want to stick with the PM, then you need to sit down and have a discussion about communication. Be specific and say things like, "If I email or phone or text, I epxect a response within 1 business day", etc. And, by the way, I do not think that is unreasonable. I try to respond to my tenants the same business day, even if its just to let them know I can't resolve the issue that day but am working on it. My gut feeling is that if YOUR emails and calls have been un-retunred or they have been slow to respond, the tenant is likely telling the truth. Additionally, it is concerning the tenant knew how to contact you. The point of having a PM is that you don't get called....
Personally, if this is your first and only rental, I would manage it myself and fire the PM. Worse case, you have the tenants from hell and you learn a lot. Best case, the PM did their job and got you a great tenant through their screening who is someone you can easily manage yourself.
@Amer the thing that I would be concerned about would be both the tenant and the PM. That is not a good sign that the tenant missed the appointment. He may just be able to talk a good game about how he's a good tenant, but I would look at the info your PM has on him. As for the Pm, have you been able to find reviews on them? I would think that they should be able to get back to you in a timely matter, especially if email is one of the ways they say to contact them. I would see if you can have other investors give you some refferals.
@Amer Mallah I can't give you a buy and hold perspective, but I can give you one from a property manager. I think response within a business day is definitely reasonable. It sounds like you guys need to have a conversation to set some expectations. There's probably a disconnect somewhere - at least I hope.
Maybe they're in the field between certain hours, and don't have email on their phone. Maybe they'd prefer to receive a voicemail, and then return it via email. Or, and this is totally possible, maybe they're just bad at getting back to people, and you need to run the other direction.
I think a conversation to see how you guys can best communicate will go a long way, if you do want to stick with them. Either way, I think expecting communication within the business day is totally reasonable on your part.
I second the proposal for self management. It is the best way to learn the trades. You can start with a 6 month lease. Once you know what to look for at renting, you are much better equipped to deal with a PM. Or you find out that you can save yourself the fees.
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