Why Do Owners Want a MTM Property Manager, but 12 Month Leases?

Question

It seems the majority of rental property owners want to lock tenants into 12-month leases. Yes, there are more than a few that insist a Month-To-Month (MTM) lease gives them more flexibility in getting rid of problem tenants, but isn't that what lease violations are for?

Given this, we're curious as to why so many SFR rental property owners are turned off by a 12-month management agreement? Is it just a case of wanting the "best of both worlds", where they can lock in tenants while keeping their own freedom?

Or is there some deeper reason?

Bill B. · Answer

Why would you ever sign a 12 month agreement with a pm? You don’t know them any better than a stranger walking down the street. What if you sign and 4 months later they haven’t found a tenant? You find out they like to charge a $1 less than they have to get an ok from you for everything? Landscaping $249, loose doorknob $249, missing window shade $249, etc. Why would you want to lock someone in to using your company?

Michael King · Answer

What if it doesn't work out and the PM is a shister? I've seen a couple of people here having trouble with their PM of choice, but when the PM doesn't pull their weight and the owner is locked into a contract....they're stuck. Why would you want to force an LL to have a 12 month agreement? I would want a PM that works hard enough so I don't have to waste my time managing my properties AND the PM at the same time. Then the business is earned.

Kind of like a government handout - why would anyone work harder for something that's guaranteed? At least, this is my opinion after having had good and bad property managers. I find the bad ones always push the 12 month agreement, the good ones don't.

Chris B. · Answer

As those above mentioned, its lack of trust commiting to a PM company you don't know and have a lot to loose from. I personally would consider a longer term contract after I had direct experience going through a turnover or two and if there was a financial advantage to a longer contract. I self manage so these are my concerns as a person who would be a first time PM client. I have personally heard many bad stories from friends of PM issues and not many good stories so I'm content as-is for the moment. This is another reason why I joined this site: to learn the industry including recommendations for good services and companies and recommendations for those to stay away from.

Why Do Owners Want a MTM Property Manager, but 12 Month Leases?

Why Do Owners Want a MTM Property Manager, but 12 Month Leases?

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