What have been the biggest challenges for you when working with a PM company?

Question

I’m considering moving my portfolio to a property management company, and I’d love to hear from owners who’ve been through this and can share their experience.

For those of you using a PM:

-What are your biggest frustrations or challenges?

-How do you deal with them in practice?

-What systems or processes have actually helped?

-And despite the challenges, what makes using a PM worth it for you?

I’m especially interested in hearing from owners with multiple properties or out-of-state rentals.

Mark Updegraff · Answer

I'm both an owner and a PM operator, so I pressure-test this a little differently.

My own properties go through the same systems as our client-owned properties. I don't want a special “owner of the company” lane because that can hide weak spots in the process.

The failure mode I worry about most is a management company optimizing for its own convenience while the owner quietly absorbs the cost through vacancy, slow collections or poor maintenance decisions.

Before hiring one, I'd ask how they handle the exceptions, not just the routine:

What happens when vacancy runs long? Rent stops coming in? A repair suddenly becomes a major expense? A renewal gets complicated?

Who owns the problem, what authority do they have, and when does the owner hear about it?

The PM is worth the money when you stop being the dispatcher without losing visibility or control of the investment.

Eduardo Cavasotti · Answer

The challenge that actually stuck around after hiring a PM wasn't communication, it was verifying the numbers on the monthly statement actually matched what hit my bank account. Rent collected, the PM fee, repair invoices, and reserve movement all have to tie out, and the quiet mismatches, like a repair with no invoice or a fee that lands a month late, are the ones that slip by if you only glance at the final deposit. What's helped most is treating the statement as something to reconcile line by line every month instead of trusting the summary number.

Drew Sygit · Answer

Yeah, we're also a PMC that takes over properties from our bad competitors regularly.

#1 issue is a lack of even knowing what to look for, so you don't even know how to properly screen PMCs!

Copy & paste advice below:

We’re a Property Management Company (PMC) in Metro Detroit ONLY, with 25+ years of experience, and we’ve seen owners make the same mistakes, over & over again when looking to hire a PMC – which drives us nuts!.

In our experience, the #1 mistake owners make is ASSUMING all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY.

So, owners mistakenly think price is the only differentiator – and look for a PMC like they’d shop for groceries☹

We encourage you to learn from the mistakes of others by reading posts here on BiggerPockets from owners that picked a PMC solely by price and regretted it.

We recommend exploring as many sources as possible to get referrals AND cross-reference them to get as much accurate information as possible.

﻿Check out NARPM.com, BP’s Property Manager Finder (BiggerPockets: The Real Estate Investing Social Network), etc.

Even if someone gives you a referral, do NOT make the mistake of assuming that just because a PMC met their expectations, they’ll meet your expectations. We all have our own expectations and what works for someone else, may not work for you.

If you’re new to all of this, it's often a case of not doing enough research, as you don't know what you don't know!

So, ask more questions!

﻿EXAMPLE: PMC states they will handle tenant screening – what does that specifically mean? What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.? You’d be shocked by how little actual screening many PMC’s do!

This also leads owners to ASSUME simpler is better when it comes to management contracts.

The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it!

﻿﻿A well written management contract should clearly spell out what is expected of both the PMC and the owner, to PROTECT both and avoid misunderstandings. Why do you think purchase contracts are so long and have such small print?

We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

P.S. If you just hire the cheapest or first PMC you speak with and it turns into a bad experience, please don’t assume ALL PMC’s are bad and start trashing PMC’s in general. Take ownership of your mistake and learn to do the proper due diligence recommended above😊

Here’s some articles we’ve contributed to BiggerPockets about screening a PMC BETTER than you would a tenant!

20 Questions to Ask When Vetting a Property Management Company: Processes

13 Questions to Ask to a PMC: Communication and Documentation

24 Questions to Ask When Evaluating a Property Management Contract

Danny Gonzalez · Answer

@Adva Asayas Congrats on looking at this before the portfolio gets messy. The usual break points are maintenance response, lease renewals, and whether the PM actually owns the vendor relationships or just forwards tickets. For out of state or multi door owners the fee only pencils if those three are tighter than self managing. What is the biggest gap you are trying to close first, response time, accounting clarity, or not being the emergency contact?

Richard F. · Answer

You must ask how many units are they currently managing for Clients, and for how many years. If they don't have at least 50 units for 10 years under their belt, move on. If the company's primary business is sales, and the PM for your property would be part of the sales team, move on. You need a dedicated PM, not a part timer.

Ask about every process that is important to you. Screening. Late fee handling. Service call responses. Renewals and Annual Inspections. Do they use licensed and insured vendors, "handy" persons, or a mix of both? Or do they have in-house maintenance staff? Do they mark up repair costs? What do the monthly reports look like for property similar to yours, and do they provide all of the info you are seeking? Do they include paid invoice copies?

Jim Johnson · Answer

From the PM side, the biggest challenges I see usually come down to expectations and communication.

• Frustration: Not knowing what’s happening with maintenance, vacancies, or an unexpected expense.

• • What helps: Clear expectations upfront about approval limits, response times, reporting, and which decisions the PM can make without calling first.
• • Systems: A good owner portal, consistent monthly reporting, documented work orders, and one clear point of contact.
• • Why it’s worth it: You’re buying back the day-to-day management—tenant calls, maintenance coordination, rent collection, leasing, and follow-up—without losing visibility into the property.

• What helps: Clear expectations upfront about approval limits, response times, reporting, and which decisions the PM can make without calling first.

• Systems: A good owner portal, consistent monthly reporting, documented work orders, and one clear point of contact.

• Why it’s worth it: You’re buying back the day-to-day management—tenant calls, maintenance coordination, rent collection, leasing, and follow-up—without losing visibility into the property.

The best relationships are usually the ones where the owner knows what to expect and the PM has enough authority to actually manage.

Leo Stein · Answer

For out-of-state and multi-property owners, the pain I hear most is opaque maintenance decisions and slow leasing feedback—not the fee percentage. What helps in practice is agreeing up front on approval thresholds, a weekly vacant-unit update with showings and reasons they didn't convert, and owner statements that reconcile to the bank deposit. In California especially, I'd also ask how they handle entry notice, habitability timelines, and deposit accounting, because those are where "we'll figure it out" gets expensive. A PM is worth it when you get documented process and clean reporting—not when you're managing the manager every week. Not legal advice, just ops pattern recognition from SoCal rentals.

Kyle Mccaw · Answer

@Adva Asayas From the PM side (and as an owner), the biggest problems I see usually come down to communication and lack of systems. Before hiring anyone, ask how they handle tenant screening, maintenance approvals, lease renewals, accounting, inspections, and owner communication—not just what percentage they charge.

For an owner with multiple properties or rentals out of state, a good PM should give you documented processes and good reporting so you can manage the investment without having to manage the manager. They should also have enough scale and specialization that leasing, maintenance, accounting, and collections aren't all being handled by the same overwhelmed person.

The right PM isn't an expense as much as a risk-management decision. The wrong tenant, slow leasing, poor maintenance decisions, or one mishandled legal issue can cost considerably more than the management fee.

What have been the biggest challenges for you when working with a PM company?

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