Hi I’m brand new to real estate investing and I’m looking to purchase my first property. I don’t know anything about tenant laws Or how to go about finding good tenants or even where to advertise. I’m learning but for right now I’m not that knowledgeable. If I hire a property management company will they find tenants for me?
Ask, but that's usually part of their fee is finding/screening tenants since they get paid on the income.
I am new to this site myself and am a PM. Yes, property managers will locate a suitable tenant for your property. There are fees involved and depending on how the individual PM company structures their fees, it is usually a % of the first months rent. At the company I work for, we take 50% of the first month's rent, then 10% every month for management fees (sometimes less). Some owners just want us to locate a tenant and then they will self-manage to save money in the long run. In that case, our % would be larger since we won't have the on going management responsibility. We do all of the background/criminal/credit/employer screening. The laws are changing constantly, so it's important to know the laws in your state in case you want to self-manage.
PMC's or an agent can find you a tenant, but who do you think will do a better job?
1) Agent: they only get a commission if they find a tenant, but they don't have to deal with the tenant once they place them. So, if they place a bad tenant what power do you have to recover the commission you paid them?
2) PMC: if they place a bad tenant, it should negatively affect their monthly management fee. Also, most PMC's will have some type of performance guarantee for a tenant they place. You also have the ability to threaten termination to negotiate replacing a bad tenant.
Just something to think about:)