Long Term Tenant, Property Management Company Bait and Switch, what to do?

Long Term Tenant, Property Management Company Bait and Switch, what to do?

Investor · Milpitas, CA · Member since 2013 · 95 posts · 12 votes

So I've posted before about my fun times with my soon to be former property management company, they are fired and now I'm in the searching process but I'm really questioning why I need a company. I have a lease, its 2 years with a 3rd year option, apparently the PM company put in the option even though I directed them to make it a 3 year and the tenant did the same. The tenant thus far has been more worried about me being stationed back in California and taking the house back than leaving as he has a great deal on a great property.

I found a company that I was seriously considering. Real property management of Antelope Valley. They offered 195 starting fees, waving all their other management and leasing fees since I had a long term lease in place, with a 9% rent draw (due to military). They use propertyware just like my previous company, and they seem great for the job, and their sample management agreement looked perfect. Then I gave notice to my former company and I got the new company to draft a contract. Well a couple things changed from the sample to the current, and a big one is their Maintenance section. In the sample agreement it had mentioned they use in house people with a service fee of $38, another plus; but in the real contract it doesn't mention anything about that but references a "Owners Biannual Inspection Brochure" for details including costs of inspections. Well I mosey over to that form which basically says "we will inspect your property at a price, we recommend a minimum of 2, max of 4 and this is the cost schedule". My property falls under the "Swamp cooler and central heat/air" section which is a $95 fee for spring inspections and $65 for all other visits. Their service includes replacing the swamp cooler pad, getting it ready for summer/winter (hooking/disconnecting a hose), replacing CO/smoke detector batteries, and replacing the forced air filter. The only other inspection level is "No inspections". I'm sorry but isn't that part of the 9% deal I have with you, to inspect the property, and I really think the service costs are a bit much too don't you all? It couldn't be more turn-key and easy profit for them but now I find myself questioning if I really need them, if I should keep looking, or what I should do.

So, I ask you my BP Brethren, they are prefect in almost every other way, do I negotiate? Do I self manage from 2000 miles away (I do have a home warranty)? Do you have another idea? Thanks in advance!

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Investor/Landlord · Farmington Hills, MI · Member since 2011 · 1k+ posts · 1k+ votes
13y

If anything changed from the sample contract you should keep looking. If this is how they behave when they are trying to get your business do you really think they will magically become ethical later on? Has that generally been your experience?

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  • Mark B.Pro Member
    Rental Property Investor · Morgan Hill, CA · Member since 2012 · 212 posts · 64 votes
    13y

    I won't be much of a help with the contract terms. Inspections are important if only because another set of eyes may catch something that someone who is there day to day won't notice or care.

    I would hesitate to rely on the home warranty company. My experience with two of them on multiple calls is they are not worth the significant management overhead they require from you to get a QUALITY job done.

    Another option is to find a handy man to be your go to guy. Pay them per trip even if they have to get someone else to fix something that is beyond their capability. Find someone who knows their limits.

  • Investor/Landlord · Farmington Hills, MI · Member since 2011 · 1k+ posts · 1k+ votes
    13y

    If anything changed from the sample contract you should keep looking. If this is how they behave when they are trying to get your business do you really think they will magically become ethical later on? Has that generally been your experience?

  • Investor · Milpitas, CA · Member since 2013 · 95 posts · 12 votes
    13y

    I honestly don't think it's an ethics issue, I think they are expanding too fast to keep up and dropped the ball on their sample contracts. That being said, I'm planning on contacting more companies now and I appreciate your response.

  • Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 31k+ posts · 20k+ votes
    12y

    @Jason Minnich ....old post......what ended up happining?

  • Investor · Milpitas, CA · Member since 2013 · 95 posts · 12 votes
    12y

    @James,

    I followed through with firing the pervious company. They have since merged with RPM, which is somewhat ironic. I didn't go with the new PM company and have been self managing long distance for a little under a year. I use rentec direct for a tenant portal and have had little issues with the property. I've visited once to meet my tenants and checked with my neighbors to keep me in the loop. I'm in the process of locking down a new lease to adjust rent so that is going well. There have been some delays in getting rent checks but we have negotiated after a period they will be switching to direct ach which I have set up via intuit's spark rent system. Thus far everything seems to be going well but I'm thinking for my current property I will be getting a PM because I don't think I will get the same long term tenant situation here as there is more turnover. Thanks for checking in!

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