12.07.09

Things to Consider when Interviewing Property Management Companies

In searching for a manager, you’ll want to do a thorough interview, and in doing so, you should be able to figure out if they are worth working with. Here are some questions you’ll want to keep in mind when interviewing managers.

Cost: Managers generally charge a monthly fee to watch and maintain your property. Those fees can range from as low as 5% or so, to upwards of 20%. Obviously, you should look for a company that charges less and provides more services.

Communication: Communication with a manager or managing company is of the utmost importance. Do they use email? Do they respond to both email and phone calls in a timely matter? In addition, you need someone who can deal with you and your specific needs. You want to let companies know up front where you stand and make sure they’re willing to be flexible for you.

Termination of your Agreement: In the event that your “relationship” does not work out, you want to know up front what exactly it will take to terminate your agreement. Is there a charge for breaking your contract? Penalties?

Repairs and Maintenance: Does the company have their own maintenance crew or do they contract out to a handyman? How much do they bill out at? Can they handle all kinds of repairs? What happens if they can’t do something? Do they have other contractors that they work with?

In addition, you probably want to have a maximum that the company can spend without contacting you. For example, most landlords will allow managers to do what they need to as long as it is for something under $200, but you must confirm any expenses over that.

Monthly Statements: Does the company send out monthly or quarterly statements?

Evictions: How does the company handle evictions? What are the costs to evict?

Yard Work: How much do they bill yard work out at? Landscaping? Do they handle snow removal? Mow lawns? How much does each cost?

Reserves: What kind of reserve does the company require? The reserves are used in case anything comes up. Most managers will require a certain amount.

Accounting: When will the manager mail your check to you? Beginning of the month? State laws usually dictate accounting rules for managers, but you will want to know all of this up front.

Tenant Deposits: How do they handle deposits? Are they comingled or simply put together with all other income for your account?

Vacancies: How does the company handle vacancies in the property?

Advertising: Where do they advertise properties? Are for rent signs put on the property’s lawn? Do they advertise in the paper? Online? There are quite a few effective places to advertise properties for free, online. Do they use these? In addition, you want your property advertised effectively. Do they have the basic HTML skills to add images to their for rent ads online?

Section 8: Do they have experience dealing with section 8 properties / tenants? Do they know what is entailed with such properties?

Adapted from www.BiggerPockets.com