Time to find a new PM
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
6yBased on what you've shared, I'm going to disagree with everyone else on here. They all recommend you review the terms of your contract but why should you be obligated to fulfill the terms of your contract when the property manager is clearly not holding up his end of the bargain?
I would start by searching for a new property manager. If you send me a PM I will give you a short list of how to research and find someone professional.
while you are searching for a new property manager, start documenting every way that your current property manager has failed to protect you and your interests or honor the agreement. once the new property manager is located, give your current property manager notice of his failure to properly manage the home and communicate. let him know you want to terminate your contract in 30 days with no penalty or fees. Give the property manager 7 business days to acknowledge receipt and confirm the termination date. Once confirmation is received in writing, start the process of transferring everything over to the new property manager.
if your current manager refuses to let you out of the contract, contact the governing state board and inquire about filing he complained. In my experience, they will typically take a verbal complaint and then contact the property manager to hear his side of the story. If you have even a slight chance of winning the argument, that call from the board will likely put the fear of God in the property manager and he will cut you loose rather than face an investigation from the state.
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Originally posted by @Andy Chen:
@Ali Boone
Thank you so much, Ali. Really solid suggestions!
I would love to get to know more about my tenants if I am managing the property myself. The reason why we pay PM is so we can free up more time investing, right? That's why I am hoping I am not just paying my PM to collect rent every month and never communicate with my tenants (and myself). The first time my tenant was behind I had to find out by noticing a Lawyer fee on my monthly report for the evection process!? I hope it was not too much to expect my PM to notify me ahead of time. I will definitely weight the pros and cons of proceeding with the eviction process (and start looking for new PM) as you suggested!
I really appreciate you for listening, advising, and taking your time sympathizing with me. It's great to have the BP family to lean on.You bet! And no, you aren't off-base. I've noticed a direct correlation between communication and performance with PMs... the minute the communication drops off, so does the performance. There's no reason for a PM to not actively communicate with you, so definitely strive to find one that does. I can gauge a lot of that just in my initial calls when I'm shopping around for new PMs. If I don't like how they communicate on that first call, I'm probably not going to like it when I'm working with them either. And vice versa.
Good luck!
- Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes6y
Originally posted by @Andy Chen:
Dear BP,
I inherited a PM when I bought my turnkey rental last year. Since the beginning, there was not any conversation or update initiated by the PM and I always had to track him down after I noticed an issue. My tenant had missed payments for a couple of months and I had to find out myself when there was no payment sent to my bank. Long story short, I am really not confident about my PM and would like to know what happens if I want to hire a new PM in the middle of the contract and/or in the process of evicting my tenant. This being my 2nd long-distance rental and I had totally no idea how to approach it. Your feedback and advice are greatly appreciated.
Thank you for taking the time reading my post.
Andy
I find it odd that this property manager didn't begin the eviction within the 1st month of non payment. Sounds like you might be dealing with a one man shop. Never a good idea. You want to deal with a large property management company that has policies in place to handle every situation.
In addition you need to ensure this company is a licensed property management company. This is very important. For starters it's illegal in almost all 50 states to manage property 3rd party without being licensed. So obviously someone running an illegal operation is reason in itself not to work with them. Beyond that the reasons for that law are important. The general public needs a governing body to oversee this stuff to protect the public's interests. Ya see, when you are property management company millions and millions of dollars flow in & out of your hands all the time.
Each state has a Division of Real Estate who oversees broker operations & requires broker's to adhere to incredibly strict accounting procedures, audits and care of all of this money that flows in & out of their hands that is that of the client's (you) or the tenant's. Think earnest money, rents before they are disbursed to the client (you) & tenant's security deposits. It adds up quickly. Hell at any given point & time I believe there is between $1 million & $1.5 million in my trust account. That money isn't mine. It's client's (you) & tenant's money. Can't just have any Joe off the street make a website & then put um in charge of that kind of money, it would be disastrous. For example to become a licensed broker where I operate (Ohio) you need to go through government background checks, have worked in real estate as a sales agent under another broker for at least 2 years, have a college degree, have a physical store front with office hours, have done at least 40 transactions and much more that I can't think of off the top of my head right now. All of this provides the public with more protection against major theft or loss of funds.
@James Wise Hi James, I totally agree with everything you are saying! I have a big team managing another property of mine in TN and I really enjoy the way they handle my business. For sure I am going to find a big team instead of a one-man show for my next PM. Thank you so much for sharing so much valuable information!
Andy
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