Congratulation you are now a landlord, whether by choice or circumstance, you are now responsible for renting, managing and maintaining your investment. There’s just one problem: you don’t want to deal with being a landlord. You are now considering a property management company to deal with all of your landlord duties. Before you jump in and sign the papers to have any company manage your investment please make this very important decision wisely.
All property management companies claim to do a superior job of collecting rent, screening tenants and keeping your property maintained and attractive. Choosing the right property manager will make a huge difference in the value of your investment and your ability to keep your residential property rented and maintained. Therefore, it pays to do your due diligence when choosing the right company. Select a property manager by evaluating the management company’s experience, talking to references and ask exactly what you are getting for your money.
Yesterday I met a client, referred from a friend and business associate, asking me to help. At first she seemed very uneasy with the process and a little overwhelmed. After spending over an hour explaining exactly what her responsibilities are and what we are responsible for, she was very comfortable and it allowed her to make an educated decision. Some clients toss me the keys and say deal with it while others ask a lot of questions and provide very detailed instructions on exactly what they want done. I take the trust people put in me and Pinpoint very seriously.
You need to do your research before hiring a property manager. Your mission is to find someone who is organized, trustworthy and experienced. Here’s how to find the best fit for your property
How they advertise vacancies: A great management firm will be aggressive in their advertisements. You don’t want your property staying vacant for too long. Remember that you have to bear the burden of any vacancies, not the management firm.
How they screen tenants: This is really important. Make sure that they are using background checks. A simple background check can find any negative history and keep you from huge losses. All it takes is one bad tenant to turn you off to rental properties
How they go about collecting unpaid rents: Any legitimate firm will have a process in place. Make sure that it sounds like a good one.
How they control maintenance costs: You always want to make sure that they will keep up with regular maintenance and to find out before hand of their processes.
How to deal with after hour emergencies: If they don’t have a system in place for these types of emergencies, why would you pay them money in the first place?
What type of accounting they offer you: It is always good to find out what kind of accounting services they offer. What kind of software they are using. Remember that great accounting means less work for you when taxes season comes.
What’s their fee structure: Finding a property manager for an appropriate fee shouldn’t be too difficult. These fees typically run 6-12% of the rent, but various firms may have different fee structures
What type of liability insurance they have to protect you from lawsuits: This one is really important. You always want to be covered in this business.
At the end of the day, the decision to hire a property management firm to manage your rental property requires much consideration due to the responsibilities and fees involved. I hope that you consider all of the points mentioned in my blog before making the decision.