Hiring a property manager will be one of the most important decisions you’ll make as a real estate investor. This is a person you’ll be entrusting with your investments, so naturally, you’ll want the best man/woman for the job. This is especially so if you’re an international investor or living out of state. While it’s important to find someone who’s experienced and educated, it’s just as vital that you find someone you can work with. They need to be pleasant while still being firm, knowledgeable without being arrogant and organized but not obsessively. To help you narrow down applicants, here are the essential questions you should ask any prospective property manager.
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- Are you the property manager that will be looking after my property? If not, who will be?
- How many properties do you personally, as well as your company, currently manage?
- What steps will you take to market my property and attract tenants?
- How will you handle things if my property needs urgent maintenance?
- How do you screen tenants?
- Tell me about your fee structure and what the full cost of management will be?
- Do you have any references I can examine?
- How will you ensure the best returns on my property and what can you do those other managers can’t?
Are you the property manager that will be looking after my property? If not, who will be?
When you first contact a property management company for an interview, they may send a business development manager to start the initial discussions with you. You’ll need to know exactly who you’ll be working with before you commit to an agency. This opening question can lead to others such as:
- How long have you been with the management company?
- For how long have you worked in real estate?
- What qualifications do you have?
Establish right off the bat who you’re dealing with. Your prospective manager should be able to demonstrate a commitment to the job and long years of experience. Property management can be a stressful job with a high turnover rate. As such, you’ll want to be sure that you’ll still be dealing with the same person six months from now.
How many properties do you personally, as well as your company, currently manage?
It goes without saying that you’ll want to hire a company that has a stellar reputation. But you’ll also want to make sure they aren’t overworked. Every property needs individual care, and you want to be sure yours will get the attention it deserves. You’ll also want to know what type of properties they manage. The management of a townhouse is substantially different from that of a condo or other larger complex. If a company has as many as 450 properties on their rent roll, then they should have at least 3-4 managers to handle these.
What steps will you take to market my property and attract tenants?
Empty properties don’t make money, so you’ll want to know how your manager intends to market the property and attract the right tenants. They should have a clear marketing strategy and a set of principles they follow when showing prospective tenants, the property. For instance, you don’t want a manager that will give the keys to anyone and let them view the property on their own. You want someone who can be available to showcase the property to every prospective tenant. Most prospective tenants work during business hours view properties on the weekend. Ensure that your manager can be available on the weekends to do open-house inspections.
How will you handle things if my property needs urgent maintenance?
A good agency will have a list of verified and proven contractors to call on when maintenance, of any sort, is needed. Ask how this will be conducted and coordinated. Some agencies will even pay all maintenance bills on your behalf if required. Be sure to discuss this with then extensively to see if you are comfortable with the process. You certainly don’t want to be sent a massive bill for a maintenance job that you weren’t consulted on.
How do you screen tenants?
Good tenants are a godsend, and you’ll need to be sure your manager is doing everything possible to screen for the right ones. They should have a clear set of standards and procedures to follow when investigating every potential tenant. Do they conduct credit checks and background checks? Do they look into their employment history and speak to their previous landlords? Ensure that your manager has a well-established system for selecting tenants. It can only take one bad tenant to harm your investment entirely.
Tell me about your fee structure and what the full cost of management will be?
This one can make or break the situation when choosing a manager. Ask about their fee structure and how they charge for extra services like lease renewals etc. Most companies are paid based on a percentage amount of gross rental income coming in, but there may also be additional charges. Ask about what every fee will include and remember, all this is negotiable.
Do you have any references I can examine?
Don’t ever hire anyone without first checking their references. Even if a prospective manager looks great on paper, it’s their references that will seal the deal with them. Contact each of their references to ask about their experience with this agency and manager. Were there any problems that they helped solve? How good were they with finding tenants? Were there any evictions and how did the manager handle them? Answers to these questions will give you a far better grasp of the agent’s capabilities.
How will you ensure the best returns on my property and what can you do those other managers can’t?
Their answer to this last crucial question will determine what sets them apart from other potential managers. There’s a lot more to property management than just collecting the rent. It’s a comprehensive service that requires a lot of care and attention to detail. Find out how your manager seeks to differentiate themselves from the competition.