This is my first time renting out a property. I will be living out of state away from my property so I want to be educated on how to properly choose a good property management company. I am looking for things I need to avoid or look for. Any advice is extremely helpful! Thanks!
This is my first time renting out a property. I will be living out of state away from my property so I want to be educated on how to properly choose a good property management company. I am looking for things I need to avoid or look for. Any advice is extremely helpful! Thanks!
I work with a lot of consulting clients that have this same issue for their midterm rental. I really discourage you from getting a property manager for your MTR. They take a lot of money, and often my clients are most unhappy when they hire a PM to manage their midterm. I recommend listing on two platforms and to hit the ground running. You'll learn quickly, save yourself money and be the most motivated to get the right medium-term rental tenants and the keep it occupied. (If you have questions on this, DM me. Probably 50% of my clients manage their midterm rentals from out of state.)
This is my first time renting out a property. I will be living out of state away from my property so I want to be educated on how to properly choose a good property management company. I am looking for things I need to avoid or look for. Any advice is extremely helpful! Thanks!
I would do phone interviews with any PM that you're considering. I would also make sure they have plenty of experience in the neighborhood that you're buying in.
Lender · Member since 2023 · 465 posts · 425 votes
2y
If you're doing an MTR/STR strategy I'd be sure that the PM has experience in the MTR/STR space and is not just LTR focused. May be worth posting in the BP classifieds for specifically what you're looking for!
This is my first time renting out a property. I will be living out of state away from my property so I want to be educated on how to properly choose a good property management company. I am looking for things I need to avoid or look for. Any advice is extremely helpful! Thanks!
I work with a lot of consulting clients that have this same issue for their midterm rental. I really discourage you from getting a property manager for your MTR. They take a lot of money, and often my clients are most unhappy when they hire a PM to manage their midterm. I recommend listing on two platforms and to hit the ground running. You'll learn quickly, save yourself money and be the most motivated to get the right medium-term rental tenants and the keep it occupied. (If you have questions on this, DM me. Probably 50% of my clients manage their midterm rentals from out of state.)
Encourage you to learn from the mistakes of others - by reading posts here on BiggerPockets about owners not having their expectations met by their current Property Management Company.
To avoid going through the same poor experience, keep reading.
Even if someone give you a referral, don’t make the mistake of assuming that PMC will meet your expectations, just because they met the expectations of the referral source.
We also can’t believe how many owners hire the first PMC they speak with!
Then they complain their expectations aren’t being met!
In our experience, the #1 mistake owners make when selecting a Property Management Company (PMC) is ASSUMING instead of CONFIRMING.
It's often a case of not doing enough research, as they don't know what they don't know!
Owners mistakenly ASSUME all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY, so price is the only differentiator – and they often select the first PMC they call!
So, the first question they usually ask a PMC is about fees - instead of asking about services and HOW those services are executed.
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!
We have a 14-page management contract that we've added our real experiences to over the years, with the intent of protecting both us AND the landlord. Beyond the Monthly Management, Placement & Maintenance fees, all other fees in our contract are IF EVENT -> THEN fees.
We don’t know any PMCs to recommend in the area mentioned, but since selecting the wrong PMC is usually more harmful than selecting a bad tenant, you might want to read our series about “How to Screen a PMC Better than a Tenant”:
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😊
Property Manager · Cleveland, OH · Member since 2020 · 312 posts · 265 votes
2y
From experience, find Property Managers that focus on what's most important to you. Does communication matter most? Get one who communicates well. Is cheap maintenance a priority? Find one with a great crew.
It's a difficult job balancing all the different priorities as a PM, so finding one who focuses on your priorities is a must.
Duluth, MN · Member since 2022 · 6 posts · 2 votes
2y
In addition to what others are saying here, I'd just advise that you don't leave your property with the PM and never look back. You should be meeting with your PM monthly at a minimum in my opinion - even if it's a super simple and quick "check-in."
Just make sure that they have similar values as you!
Real Estate Consultant · Reston, VA · Member since 2022 · 513 posts · 521 votes
2y
Make sure the PM has experience operating medium term rentals. Those that specialize in LTR and STRs likely won’t have the necessary systems in place to run the MTR successfully. I would ask them how they receive leads (ideally you want someone with B2B connections) and the average occupancy of their current MTR portfolio.
Investor · NY · Member since 2018 · 96 posts · 17 votes
3d
old thread, but for anyone picking a pm from out of state... i'd interview them for the day the plan breaks. erin's point about managing a midterm rental remotely makes sense, if thats the setup. but when the cleaner doesnt show or a tenant can't get in, who physically goes to the house? if the answer is “we have vendors,” ask who calls the second one when the first one ghosts.
ask them to walk you through a recent turnover ... how long the place sat, who handled leasing/cleaning, when they changed the price, what the owner actually paid. then ask for a redacted owner statement and a repair invoice. a nice portal tells you where the problem was logged. you want to know who owns it until its fixed.
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