If you own a property you plan on renting out to tenants, choosing the right property management company can make your life much easier. Click here to learn more about this topic.
There are many factors to consider when choosing a property management company. To optimize your chances of making the best possible decision, keep the following tips in mind:
Make Sure They Know the Area
This may seem like a tip that should go without saying, but it’s such an essential one that it earns a spot on this list. To truly be an effective property manager, one must be thoroughly familiar with the area in which a property is based. The right property manager for a property in Houston, Texas may not be able to serve the needs of someone who owns a property in New York City.
Check for Licenses and Certifications
Don’t make the mistake of assuming a property management company has all the necessary professional licenses, certifications, and applicable insurance policies before hiring them. Check on this topic early when interviewing a possible candidate.
Choosing the right property management company doesn’t actually need to be a very challenging or complex process. Choosing a property management company qualified to serve you is, in many ways, similar to the process of choosing a new doctor or auto mechanic.
For example, if you’re like many people, when you need a new auto mechanic, you will check their reviews on independent platforms such as Yelp! to learn more about what past and current customers have to say about their services. You can easily do the same when choosing a property management company.
You should also ask the representatives of any company you’re thinking about working with for testimonials. That said, you might wonder why this is necessary if you’re going to be checking reviews on independent platforms anyway. Your goal when asking for testimonials isn’t to get additional reviews.
Those you can find elsewhere. Instead, you should focus on using this opportunity to gauge the way someone reacts to this request. If a property management company genuinely serves its clients well, a representative will be eager and enthusiastic about providing testimonials. If they don’t, this request may be met with some hesitancy. In general, it’s always a good idea to pay attention to how you feel about the way a property management company’s representatives respond to your questions.
While what’s most important is thoroughly vetting your options to ensure you’re hiring a company you can trust to deliver quality service, you shouldn’t overlook your basic “gut feelings” about how a particular company’s communication style impacts your impression of the company. For example, if a representative doesn’t seem to provide you with thorough answers when addressing your questions, you might want to hire a company whose team seems more likely to have time for you.
Ask About Emergency Assistance
This is an important factor to consider. It’s also an easy one to forget about. For a number of reasons, there may be instances when you need emergency assistance from your property management company. Ask if they offer such help. You want the peace of mind that comes from knowing that, if you ever do need to contact your property management company due to an emergency issue, someone will be available to promptly respond.
Check Their Fees and Carefully Review the Terms of Your Agreement
Don’t overlook the obvious when hiring a property management company! While you don’t want to sacrifice quality service in the name of savings, you also don’t want to pay more than is reasonable. Generally, you should carefully review the terms of your property management agreement before signing any papers.
If you’re unsure of whether an agreement is fair or appropriate, consider enlisting the help of an expert, such as a legal professional who specializes in these matters, to review your agreement as well. If you’re not familiar with the property management niche, it’s easy to misunderstand the nuances of an agreement.
Discuss the Tenant Screening Process
Helping you find reliable tenants who will pay their rent on time is among the chief responsibilities of your property management company. However, it’s worth noting that virtually all property management companies will advertise themselves claiming they offer quality tenant screening services. This doesn’t mean they’re all being honest.
Ask to discuss the tenant screening process in greater detail when interviewing the representatives of property management companies. The representative of a company worth hiring should be able to provide you with a reasonably detailed explanation regarding how they identify tenants worth renting your property to.
Ask About Vacancy Advertising
The average tenant turnover rate (being the average rate of leases that aren’t renewed when they end) in the US is currently about 47.5%. You need to consider the fact that, while a property management company can help you find initial tenants, you shouldn’t necessarily expect those tenants to rent your property on a permanent basis.
This highlights another important responsibility of a property management firm: helping you attract new tenants when current tenants decide not to renew a lease. The ideal property management company will aggressively advertise vacancies when tenants choose not to renew. As with discussing tenant screening processes, this is a topic you must discuss in relatively significant detail to ensure a property or unit won’t remain vacant for an unreasonable length of time.
Ask About Specifics
If this guide has taught you anything, it should be that choosing the right property manager for your needs is easier when you ask about their services in a manner that involves talking about specific details.
For example, instead of having a general discussion about how long it may take to place a tenant, you should ask if they have specific data on this topic. Granted, the representative of a property manager may not have all the data you need if they haven’t recorded certain data points, but as much as possible, you want to get concrete details from them.
Most importantly, don’t let this process intimidate you. Yes, finding a strong property manager is essential, but as this guide indicates, it doesn’t need to be more challenging than necessary.