Property management questions

5 Replies

Can someone direct me to a good article about what all a property management company would be responsible for? I understand the basics (collecting rent, advertising, paperwork) but what about details about the maintenance? Say a pipe bursts in the middle of the night? Who does the renter call? Who pays for the work? Do I get to approve who does the emergency work? I know not all companies are the same but I'm looking for what to look for in a good one. Any information is helpful and my apologies for the very newbie question.

I'm sure you can find articles related to your question but the main thing to understand is that everything is negotiable. Some PM's do more than others, some charge more than others. Interview and pick the best value for the cost and remember cheaper rarely gets you better value.

I can answer some of these based on my profession @Brad Campbell . As you said, it always varies by company, but here's what we do -

Pipe bursts: tenant calls PM. PM coordinates with tenant / plumber. PM pays for work from collected rents. Your PM and you should agree on an amount that would require approval. For us, that is $500 usually. Anything more requires owner approval. Yes, you can select contractor. I'd question very heavily any pm that requires you to use "their" people. Why would they if they don't stand to benefit?? Red flag... If an owner wants us to use "their guy" we will, but we explain if it breaks in a week and we have to deal with a bunch of nonsense, we will bill them for that time. 

Hope that helps...

@Brad Campbell

Remember: cheaper doesn't mean you'll make more money.

You can start by going to www.narpm.org to search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start. Regardless of how you find them, try to interview at least three managers

1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their different staff qualifications.

2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.

3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 5% management fee but the extra fees can add up to be more than the other company that charges 10% with no add-on fees. Fees should be clearly stated, easy to understand, and justifiable. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate!

4. Review their lease agreement and addenda. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.

5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance, late rent, evictions, turnover, etc. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that it is enforced equally and fairly by their entire staff.

6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact they are complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.

7. Look at their marketing strategy. Are they doing everything they can to expose properties to the widest possible market? Are their listings detailed with good quality photos? Can they prove how long it takes to rent a vacant property?

This isn't inclusive but should give you a good start. If you have specific questions about property management, I'll be happy to help!