So you`ve finally decided that you are not happy with your current property manager or maybe you thought that managing your own rental property is not the best idea. Now, you wish to leave the work on more capable hands. Relinquishing the control of your property to a professional property management company to manage it on your behalf is not an easy decision, and has its pros and cons.
As human beings, we place a lot of attachment to the things that we own. Real estate properties are especially held with high esteem since it is probably the most valuable thing we will ever own. Thus, the decision to hire a professional property management company and bestow decision making responsibilities on them is not easy and does require some caution. You need to know who you`re getting in bed with to ensure that your business venture is safe and prosperous.
When hiring professional property managers, here are some crucial points to consider. The importance of hiring the right people to handle your investments can’t be stressed enough.
- Reputation & track record
Before you settle on any firm, do a background search of their previous and current clients. What`s their customer satisfaction rate? What are their previous clients saying about them?
You need to be careful because there are a lot of newbies out there, and some may not be experienced enough to handle properties of certain magnitudes. Inexperienced usually means desperate and you definitely don’t want anybody with those two attributes in charge of your 7-figure investment.
Be sure to check out if whatever firm you choose is experienced enough to manage your type of rental properties. Are they experienced in commercial rental property management or are they accustomed to residential properties?
RentVest primarily focuses on residential property management. What every owner should look for in a property manager is efficiency, reliability, trustworthiness, and a history of short tenant vacancy time frames. What’s the average length of stay of the tenants that are living on the properties they manage?
Frequent vacancies can tell a great deal about tenant satisfaction. It is also important to note that frequent vacancies will cost you thousands of dollars. The more you’re able to retain tenants, the better it is for you. That is more important than the fee a professional property management company charges.
How satisfied are their current and previous tenants about their style of management? Are their grievances settled on time and in a satisfactory manner? How do they screen potential tenants to ensure that your other tenants are safe from people with criminal tendencies? How effective is their screening procedure in weeding out serial rent defaulters before they become tenants on your property?
With regards to their fees, you need know whether they charge a flat fee or a percentage of the monthly rent for each unit and what other additional fees they charge. What fees are you likely to incur when you terminate your contract with the management company?
Hidden fees are very common when dealing with property management firms. The reason they are known as hidden fees is because they are never revealed while signing the contractual agreement, mainly because the other party plans to take advantage of you.
Before you sign an agreement with any property management company, make sure that all the fees are disclosed. You don’t want to first find out about them when you see them appearing somewhere on a ledger.
Here are the other things that you should take note of when hiring property management companies. Be sure to go through every item in the list for your own protection.
- Depth of responsibility that they are willing to take while overseeing the property on your behalf
- Do they charge a reduced fee for vacant units?
- How many other properties do they handle and what is their capacity? This is very critical in ensuring that you choose a company that is fully committed to your property and is able to attend all management spheres without any hitches.
- How does the firm deal with rent defaulters?
- What is the firm’s eviction procedure?
- What is their record keeping procedure?
- What is the firm’s marketing plan for vacant units?
- What is their rate of responsiveness to tenant complaints and distress calls?
- What is their repair and maintenance plan for your property? This is very important in ensuring that your property remains in good shape and does not depreciate in value. Do they bloat the costs of repairs?
Be very careful while choosing a professional property management company as it makes a big difference on the long-term success of your venture. Always look at the big picture. Taking a little more time to vet the company can relieve years of worry and avoid potential problems.