Finding the right property manager to manage your investments can be a daunting task. Busier real estate markets may have dozens of residential management companies that you can choose from, and they might seem very similar at first glance. However how do you know which one will be the right company for you? A good property management firm can easily become one of your greatest assets, second only to the properties that they steward on your behalf. That said, your property manager will make critical decisions on your behalf making it extremely important that you do your homework during the hiring process. Here are 5 ways to find the best property manager for your properties.
How Many Rentals Do They Currently Manage
This will help you understand their size. Too few rental units and they are either inexperienced or have lost clients due to poor service. Too many rental units and you will get lost in the shuffle. Look for a property manager with 200 to 600 rental units. That’s when you’ve found your Goldilocks level of “just right.”
What References Do They Have
The best property management companies will be able to easily provide customer references, reviews and testimonials. Pay special attention to the reviews of services that are most important to you, or from properties similar to yours.
How Long Have They Been Managing Properties
Property management companies may come and go, and this can leave you and your board in a bind. Finding a property management company that has been in the business for some time is an excellent way to ensure that your property management company is here to stay. Not to mention having a professional property management company with decades of expertise could prove very helpful if your community needs legal, accounting, emergency response, and maintenance expertise. The biggest benefit by far is that a company with longevity has most likely encountered and solved any issue or problem your community has; there’s nothing they haven’t seen before.
Find Out How Do They Manage Tenants, Vacancies, and Accounting
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.
The process they use to show properties can not only describe the precautions they use, but also whether it will be successful in obtaining quality tenants. For example, if they only show properties Monday-Friday 9am-5pm, this will decrease your odds of getting a tenant with a regular job.
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.
Any legitimate firm will have a process in place. Make sure that it sounds like a good one.
You always want to make sure that they will keep up with regular maintenance and to find out before hand of their processes.
If they don’t have a system in place for these types of emergencies, why would you pay them money in the first place?
It is always good to find out what kind of accounting services they offer. Remember that great accounting means less work for you when taxes season comes.
What Are Their Terms and Agreements
The management agreement should clearly define the responsibilities of the property manager and that of the property owner. Are the same terms you discussed during the interview included in the contract? Pay close attention to the sections on services provided, extra fees charged, responsibilities of the owner, compliance with fair housing laws, hold harmless clause and reasons for cancellation. A full-service property management contract is usually anywhere from one to two years long – and your residential management company may have penalties or fees associated with ending your contract early. If this is true, you’ll want to learn about it immediately. On the flip side, there may be added benefits to renewing a contract year after year.