Always “Interview” Your Property Manager
The first step to securing a property manager for your property is for the property owner to be clear about the purpose of renting the property. Is the purpose to secure passive income; or to rent until the market improves so it can be sold; or is it being rented till the owner can move back in after a time away? If the purpose is to secure passive income, this is generally a long-term plan to keep the property as an investment and selling it is usually not a consideration. Renting till the market improves to sell and renting till the owner can move back into the property are generally shorter-term rental plans. Keeping the purpose in mind, a property owner can create a list of property owners using rentUSAnow’s search tool and then can interview potential property managers using these guidelines:
- How many properties are in your portfolio?
Why is this important? Depending on the size of the company (a question we will get to), this tells you two things: How many people trust the manager with their real estate; and, how busy the manager and his/her team are. Trust in a property manager must be well-earned. The manager handles both your income and the value of your property (equity) based on how well the home is maintained and looked after by the manager and the tenant. Good property managers are busy property managers. Good property managers ensure there are enough members of their team to handle the numbers of properties they manage. The important follow-up to this question is:
- How many staff members do you have and what qualifications do they have?
Why is this important? For the reasons stated above. There need to be sufficient team members to handle the number of properties in the manager’s portfolio. It is also important to know that qualified people with experience are dealing with your tenant(s) so that you don’t run into legal issues with the way the property is being managed. Some recent case law has suggested that a landlord is not entirely immune from liability for the actions of the landlord’s property manager. Same will go for the actions and behaviors of the manager’s staff. It is always excellent if the property manager has credentials and association membership for continuing education. It is even more excellent if the manager hires staff who also have experience, credentials and association memberships and who also participate in continuing education on topics important to the industry.
- What is the longest property management agreement you have ever had?
Why is this important? Trust. I reiterate how important trust is in this relationship. A long-standing property management agreement lets you know if the property manager has been able to establish ongoing relationships of trust. I personally have a property management agreement with a property manager for four out of state properties that is almost ten years long. That’s trust!
Next blog, Questions 7 through 9…