All Forum Posts by: Matt Friesz

Sounds like there is more to the story but what I am finding lately is investors dumping properties on us the property management company that are not rent ready or even close and expecting us to work miracles. We are backed up with construction work for all the properties we manage and we keep getting more investor clients who want to use us but also think we have an endless supply of labor in a very tight labor market. 

Hire another contractor to do the work perhaps but this is why I don't recommend out of state investing. You're better off putting your money in an index fund. 

Go up there and find out why they are still vacant and what has been done in terms of renos.

Ask for links to the two units that are listed for rent.  See what other units are available in the area and track how long they are listed for rent.

Start taking charge. I see you've now asked for a scope of work, hindsight is great, but you should have given them a detailed list after walking through the place. You should have got a completion date from the contractors and what happens if it isn't complete.  If it is what you listed (sheetrock, flooring, paint and trim), that shouldn't have taken 7 months-that should have been done in a month if the PM is good and has trades lined up (which they should).  If the PM agreed to do the work, then they should have got it done.

Nathan's post is spot on.

IT doesn't take six months to renovate a rental and it sure doesn't take that long to find a renter. You need an honest PM that works for their money and you need to stop letting people walk all over you. If the PM says it should rent in 30 days, then you need to put your foot down when it hasn't happened after 30 days.

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

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. You can also search Google and read reviews. 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 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 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. 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, particularly if you have a lot of rentals.

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 policies are 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 that a tenant is 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!

@Matt Friesz

May need to do a day trip to Iowa and a red eye back to Florida to see what is going on.

How long has the second pm been involved? Had did you find this pm?

Are the units renovated and habitable?

Lots of questions as this is not uncommon as people think.