So I have interviewed 2 different companies to handle a rental that is far from where I live. I liked both. The deciding factor boils down to one company being aligned with a big, professional Real Estate office and the other is much more "mom and pop".
Both parties seem very squared away. Both are likable. One seems more experienced than the other. One has only 12 single family homes and a few commercials. Does this boil down to using my gut instincts? Is experience everything?
Finally, should I interview more?
The best way to go about this process is from the inside out. Here's what I mean: the sales staff of a PM company or the owner will be able to make it sound great. I would advise going directly to the internal operations of the business and see how they preform. You can do this by going to their website and seeing what listing date available for rent. Call them as if you were a respective tenant. See if they even answer the phone, when they answer are they professional, see how accommodating and timely they are with scheduling a showing. See how knowledge able they are the property or their procedures. Maybe even throw in some bait questions like " is this house ok for kids?" Their response will let you know if they are smart about how they respond to fair housing law questions and if they mess up on the answer move on or they may have you getting sued for discrimination.
If possible even go to the home and view it as if you were a prospective tenant see how well it is cleaned and desirable to attract new tenants. The point is sales staff and owners can make anything sounds great. Get the real picture.
Best of luck on your search.
Interesting perspective Jered, thanks!
I've gone through a total of 8 property managers. The only one that was any good was a mom-and-pop where they were managing their own units alongside mine and treating them with the same level of care, unfortunately when they scaled their PM business they sold it to a large "professional" PM (good for them, bad for me) who then proceeded to financially abuse their newly acquired clients and run the business into the ground.
So, chances are they both suck, but you have slightly better odds with mom-and-pop if it meets my description above. This is one of the MANY reasons I no longer invest remotely. Good luck to you, I think you'll need it.
Wow, I guess it's not always sunny in California! Thanks for the input David. The Mom and Pop also came as a rec from a long time friend who is a real estate agent but not an investor. She did not know much about his business acumen but he came in as a "really nice guy"!
The only reason I am investing long distance is because this house is currently my primary residence but I am moving in May. It is a great opportunity for me to get my feet wet and have a nice positive cash flow.
A follow up question, if I may? I have interviewed 2 PM's so far, is that enough?
I personally think a medium size company with good systems and staff in place will be able to offer consistent customer service throughout the process.
@Jered Sturm has it right. Go visit the office and will become very clear who you want to hand the keys off too.
Large companies are a big machine that lose the personal touch. It's all in the name of profits.
Mom and pop companies will have their ups and downs if there is limited staff when they are at the pta, kids baseball tournament, vacation, or home sick. Their systems will go down when they do.
I took your advice and went to visit the office of the PM that was recommended to me. Both of the men that came to my home were both at theirs desks toiling away. The office was large [it is their only location], it was busy, well appointed and very professional and definitely gave me some peace of mind.
I may interview one more company but I think I have found what I'm looking for.
I went through this exact question myself recently. I wrote an article about it-
Not sure if it gives an answer specifically, but maybe some food for thought.
(ultimately, I'd say go with your gut. Which company makes you feel a tad more excited...)
I found a small agency branching out into property management that was eager to make a positive name for themselves and generate more clients. They have been awesome and they spend my money like it is their own. The previous agency was large and did repairs and make readies through a large expensive company.
I suggest finding a PM that is going to know you by name not make you just another address in their inventory of hundreds of properties.
I own a smaller PM company in Texas and acquire many properties from the large conglomerate management companies. When I ask owners why they chose a smaller company it's because they felt like they are lost in a huge list of clients with the larger companies. If I were you I would ask all of the common questions but in addition I would see if the companies you're interviewing have some sort of owner manual. We provide this to owners to show what the expectation is for us as the management company and what the expectations for the investor as well. Additionally, try calling the perspective management company on a weekend...like call on one of their available rentals. Being available to show units after hours/weekends is SUPER important as well. Message me if you'd like me to send you some FAQ's that you should ask. Good luck!
Thank you Courtney!
Experience means a lot. But I would also advise you to check out review sites such as Yelp to see what other people think of these companies. You can drive by properties that the management companies are managing. It will give you a good idea of how they will treat your property.
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