New OOS Owner - I Think I Need to Fire my Property Manager?

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New OOS Owner - I Think I Need to Fire my Property Manager?

Mark Tabah
El Segundo, CA · Member since 2018 · 18 posts · 8 votes

Good day BP community!

I purchased my first investment property, a duplex in Indianapolis, on the 1st of October.  I bought it post-renovation, so the place was move-in ready at close.  I had a property manager lined up at closing and they setup some website pages for me (Trello & Buildium).  But then a couple weeks went by and the property manager called me to ask if the place was ready.  I told him yes and swallowed my frustration that we had wasted a couple of weeks just letting the place sit empty.  At the end of October I got an email from the title company stating that they still had the keys!  Since then the property manager has put a lockbox on the house (I believe) and that's it.  No listings, no pictures.  Worse, they've stopped responding to my emails; I haven't heard from them since the 13th.  

I don't have a signed contract or anything other firm agreement in place, but I want to make sure that I am protecting myself when replacing property management companies.  Any advice or property management recommendations are greatly welcomed.  Thank you for taking the time, have a wonderful holiday season!!!

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David Moudy
Property Manager · Indianapolis, IN · Member since 2018 · 39 posts · 26 votes
6y

I agree the PM should definitely be fired and has not done a great job for you thus far.

In fact we have been terrible. I am grateful for the feedback as this allows us to improve. Our communication has been sub par. We dropped the ball on this one hard.

I think we deserve every but of getting fired however think we can improve moving forward.

Please give me a call at your earliest convenience. If you decide to move on there will be no hard feelings. I think we can make this better though.

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  • Caleb Heimsoth
    Rental Property Investor · Durham, NC · Member since 2016 · 7k+ posts · 7k+ votes
    6y

    @Mark Tabah unfortunately a lot of this is par for the course when it comes to long distance investing.

    The good news is since there’s no contract, and no tenants, switching PMs is very easy. I would interview a couple other ones and switch. I’d also ask that the title company mail you the keys. Then make copies and mail those to the new property manager.

    2Reply
  • Joe SplitrockPro Member
    Moderator
    Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
    6y

    @Mark Tabah yes you need to fire them ASAP. Also be aware there have been major scams in the Indianapolis area with Morris Invest and Oceanpointe Property Management. I hope you are not wrapped up in any of this or dealing with a PM that may include ex-Oceanpointe employees. Who are you working with there?

    The challenge in Indy is there are lots of tough areas, lots of wholesalers churning crap properties and neighborhoods that are just hard to rent in. Lots of out of state investors are have been taken for a ride in Indy. From what I have seen, I would stay away from Indy unless you are a local investor. 

    5Reply
  • Mark Tabah
    OP
    El Segundo, CA · Member since 2018 · 18 posts · 8 votes
    6y

    @Caleb Heimsoth Great idea to get key copies made!  I'm hoping this is just a bad apple and not an experience I will need to repeat.  Thank you sir!

    2Reply
  • Mark Tabah
    OP
    El Segundo, CA · Member since 2018 · 18 posts · 8 votes
    6y
    Originally posted by @Joe Splitrock:

    @Mark Tabah yes you need to fire them ASAP. Also be aware there have been major scams in the Indianapolis area with Morris Invest and Oceanpointe Property Management. I hope you are not wrapped up in any of this or dealing with a PM that may include ex-Oceanpointe employees. Who are you working with there?

    The challenge in Indy is there are lots of tough areas, lots of wholesalers churning crap properties and neighborhoods that are just hard to rent in. Lots of out of state investors are have been taken for a ride in Indy. From what I have seen, I would stay away from Indy unless you are a local investor. 

    I'm not with either of those firms, so it sounds like I dodged some bad apples.  I'm currently with Moudy & Co., I don't believe that they're tangled up in that mess.  But it's a very good cautionary tale.  I understand that real estate investment isn't easy, especially OOS, and that there are going to be stumbles and obstacles.  Thank you for your advice!

    1Reply
  • Joe SplitrockPro Member
    Moderator
    Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
    6y
    Originally posted by @Mark Tabah:
    Originally posted by @Joe Splitrock:

    @Mark Tabah yes you need to fire them ASAP. Also be aware there have been major scams in the Indianapolis area with Morris Invest and Oceanpointe Property Management. I hope you are not wrapped up in any of this or dealing with a PM that may include ex-Oceanpointe employees. Who are you working with there?

    The challenge in Indy is there are lots of tough areas, lots of wholesalers churning crap properties and neighborhoods that are just hard to rent in. Lots of out of state investors are have been taken for a ride in Indy. From what I have seen, I would stay away from Indy unless you are a local investor. 

    I'm not with either of those firms, so it sounds like I dodged some bad apples.  I'm currently with Moudy & Co., I don't believe that they're tangled up in that mess.  But it's a very good cautionary tale.  I understand that real estate investment isn't easy, especially OOS, and that there are going to be stumbles and obstacles.  Thank you for your advice!

     It looks like David Moudy is the owner and he is a BP member, so you may want to reach out to him on here. I have seen issues with local PM in my city and it is usually not even a scam, but rather poor management. Sometimes thin staffing is even to blame, but your service level is unacceptable and it falls on the business manager. You have to list and promote properties quickly this time of year. I hate to say it, but nobody is thinking of moving between Thanksgiving and Christmas in a cold climate state. You will likely be vacant until January at least.

    2Reply
  • Anna Sagatelova
    Property Manager · Cleveland, OH · Member since 2019 · 446 posts · 566 votes
    6y

    @Mark Tabah I'm sorry you're enduring this needless vacancy, but I have to ask - is a management agreement not required to be in place for this PM to do the work you are expecting?

    At our company, we would not start marketing efforts until the management agreement is signed and the rest of our onboarding process is complete. As for the keys, it's part of our onboarding process to ask who has them, and only after all documents are signed do we reach out to that party and arrange for pickup/delivery.

    I'm in Ohio, not Indiana, so things may be different there but the core concept of a management agreement seems pretty universal - a BILATERAL contract that outlines both owner's and PM's expectations and duties and gives management authority to the PM to do its job. That's why when we call a utility company on behalf of an owner to turn electricity on, we have to fax them our management agreement for that property.

    2Reply
  • Joshua Howaniec
    Contractor · Indianapolis, IN · Member since 2016 · 267 posts · 144 votes
    6y

    @Joe Splitrock I saw you stated that Jason was the owner of the company, did you mean David? I know that guy and if Mark is using David I would be surprised. In the past I have only heard great reviews about his level of attention. 

    0Reply
  • Richard Bonisa
    Investor · Indianapolis · Member since 2019 · 108 posts · 69 votes
    6y

    I do know a few good PM companies, I'd be very careful on the next one if you need rehab too. Indianapolis is great, but connecting with the appropriate resources can be the key.  

    I've heard alot of good things about Moudy. Problem with any business is growing too quickly.  Eventually communication and ethics can take a back seat. 

    Hoping you get things ironed out!

    2Reply
  • Joe SplitrockPro Member
    Moderator
    Rental Property Investor · Sioux Falls, SD · Member since 2015 · 9k+ posts · 18k+ votes
    6y
    Originally posted by @Joshua Howaniec:

    @Joe Splitrock I saw you stated that Jason was the owner of the company, did you mean David? I know that guy and if Mark is using David I would be surprised. In the past I have only heard great reviews about his level of attention. 

    You are correct, I meant David. I can't speak to his track record, but two months to even list a property for rent is not acceptable. There was a good chance of renting in October and now it is the dead zone, so this duplex will sit vacant 3+ months most likely. When a business (or tenant) goes silent and will not respond, that is ALWAYS a sign of worse things to come. 

    1Reply
  • Joshua Howaniec
    Contractor · Indianapolis, IN · Member since 2016 · 267 posts · 144 votes
    6y

    @Joe Splitrock no argument there. I’m just surprised. He and I met over a year ago and the investor using him always bragged on him.

    0Reply
  • Ryan Deasy
    Lender · Farmington, CT · Member since 2015 · 542 posts · 321 votes
    6y

    @Mark Tabah Mark, wow, i am sorry you are dealing with this. i am an out of state owner. i own properties in Connecticut and i live in Houston. i manage everything on my own to avoid what you are dealing with. if you ever feel like taking on management yourself, just let me know. i would be happy to help. 

    2Reply
  • Grant Anderson
    Investor · Indianapolis, IN · Member since 2010 · 117 posts · 41 votes
    6y

    You don’t have anything signed with them? You should have a signed a property management agreement and had everything set up for your property manager prior to purchasing the house. With that said, it sounds like they are not the best property manager for you since they haven’t really done anything to gain your business. You should move on and get a new property manager. Do you have boots on the ground to check out the property to see if the property management company has rented the house out without your knowledge? 

    0Reply
  • Charlotte Dunford
    Investor · Johns Creek, GA · Member since 2017 · 463 posts · 488 votes
    6y

    @Mark Tabah I would fire him especially because you do not have any agreements with them. Time is money and they apparently don't realize that.

    2Reply
  • Joshua Howaniec
    Contractor · Indianapolis, IN · Member since 2016 · 267 posts · 144 votes
    6y

    @Mark Tabah message me if you would like some boots, and eyes. Also I know your PM. I’ve done floors on properties he manages.

    1Reply
  • Andrew Ashby
    Investor · Orlando, FL · Member since 2016 · 355 posts · 380 votes
    6y

    I'd say it's time to jump ship, especially with no agreement already in place. They obviously don't have the time, care, and/or resources to devote to your investment. Communication is key in this business and it looks like it's not happening. It's one of the key reasons I fired my own property manager.

    1Reply
  • Mark Tabah
    OP
    El Segundo, CA · Member since 2018 · 18 posts · 8 votes
    6y
    Originally posted by @Ryan Deasy:

    @Mark Tabah Mark, wow, i am sorry you are dealing with this. i am an out of state owner. i own properties in Connecticut and i live in Houston. i manage everything on my own to avoid what you are dealing with. if you ever feel like taking on management yourself, just let me know. i would be happy to help. 

    Thanks for reaching out Ryan!  I've thought about self-managing, but unfortunately my job just doesn't give me enough time at this stage of my career.  Do you find that OOS self-managing takes up a lot of your non-working+non-sleeping time?

    0Reply
  • Josh C.Pro Member
    Property Manager · Indianapolis, IN · Member since 2010 · 1k+ posts · 1k+ votes
    6y

    @Mark Tabah

    As others said haven’t heard bad things about them, but 2 months is a very long time. Give me a shout. You need to list it ASAP with the weather changing.

    1Reply
  • Andrew Davis
    Investor · Asheville, NC · Member since 2011 · 833 posts · 499 votes
    6y

    @Mark Tabah Ughhhhh! I feel your frustration - finding a good PM can be tough. I personally use David Moudy to manage my investments in Indy and have been very happy with him. Hope you get it resolved quickly.

    0Reply
  • Nick GiulioniPro Member
    Rental Property Investor · Carmel, IN · Member since 2016 · 1k+ posts · 615 votes
    6y

    I use David for my properties and have had fantastic experience. 

    1Reply
  • Craig Bellot
    Property Manager · CT · Member since 2014 · 687 posts · 329 votes
    6y

    Time for a new property manager ASAP.  

    Communication is the #1 attribute of a good manager.   Here in Connecticut we send out weekly reports of showings, inquiries and applications for vacancies.  

    I'm sure you realize every day it sits vacant is costing you.  Cut your losses now @Mark Tabah

    0Reply
  • David Moudy
    Property Manager · Indianapolis, IN · Member since 2018 · 39 posts · 26 votes
    6y

    I agree the PM should definitely be fired and has not done a great job for you thus far.

    In fact we have been terrible. I am grateful for the feedback as this allows us to improve. Our communication has been sub par. We dropped the ball on this one hard.

    I think we deserve every but of getting fired however think we can improve moving forward.

    Please give me a call at your earliest convenience. If you decide to move on there will be no hard feelings. I think we can make this better though.

    6Reply
  • Noel R.
    Rental Property Investor · Petaluma, CA · Member since 2015 · 151 posts · 143 votes
    6y

    @Mark Tabah you have to manage the manager. How did you allow so much time to go by without contact? It appears to me like you are equally at fault for not being on top of this. The big takeaway from this should be that even with a PM you have to stay actively involved and watch your investment like a hawk.

    3Reply
  • Paul Beets
    Investor · Indianapolis, IN · Member since 2018 · 86 posts · 84 votes
    6y

    @Mark Tabah

    I agree whole heartily with what @Noel R. said.   I'm an OOS (ok ... Michigan isn't THAT far from Indy).   But my experience has been you MUST manage your property managers.  AT LEAST until the properties are rented.   I am actually in the process of switching some of my properties to @David Moudy & Co.   So far so good!    They come HIGHLY recommended by many of the most experienced investors in and outside of Indy.   My experience has been good so far they respond timely to any and all e-mails and phone calls.

    PM me if you have any questions.   I've been with two other property management companies and have interviewed more than a dozen of them.   I'd be happy to share my experiences.

    Cheers,

    Paul

    0Reply
  • Jeb Brilliant
    Rental Property Investor · Long Beach, CA · Member since 2015 · 623 posts · 155 votes
    6y

    @Mark Tabah I don't know @David Moudy but I've heard good things about his company as well. I'd give him a call like he suggested and see if this can be remedied. BUT if it's not, fixed in 24 hours move on. 

    Also I suggest never signing a 12 month agreement with a PM for THIS exact reason. I would do 6 months max but prefer month to month. 

    By the way, there's a great blog post on here somewhere with 80 questions to ask a PM, I wouldn't ask them all 80 but it should give you some good ideas. 

    If you need a few suggestions on who to interview next hit me up. 

    Good luck.

    1Reply
  • Charles Kao
    Specialist · Grand Rapids, MI · Member since 2016 · 1k+ posts · 611 votes
    6y

    @Mark Tabah Get on a plane and network there for a few days and find a property manager. Passive investing is never passive unless you are investing in a fund so if you don't want to at least check your monthly statements to oversee your PM I would invest in a fund or syndication. The day you close you should have clear expectations in writing what will happen. I have a deal close next Thursday and we have the PM agreement signed, what is an allowable rent, and strategy for placing this time of year and I know I am getting an update at least 1-2 times a week until

    it is filled. When a PM company goes over a week, 2 tops without contacting you after closing it is means they are not showing property because they should at least be updating you that is filled. I would suggest you learn the process of what a PM does so you can give guidance on what you want.

    1Reply
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