How to Choose a Good Property Manager
Property managers are responsible for a lot of crucial aspects of real estate management including, managing homes, apartments, office buildings, retail buildings, and mobile home parks. Therefore, hiring a property manager is not a decision that should be taken lightly. Tasks that property managers are responsible for include (but are not limited to): collecting rent, taking calls from clients, arranging for repairs, and inspecting the property. Not surprisingly, property managers do not come cheap. Most charge between 5% – 20% of the gross rent – some even charge set-up fees for advertising and visits to the property.
Choosing the wrong property manger could cost you a lot of money. For example, a property manager may not take good care of the property, which could result in lower rent and deferred maintenance. In opposite, the property manager could reduce profits by spending too much on maintenance and repairs. Furthermore, property managers could end up approving tenants who cannot afford to pay or do not make timely payments, resulting in additional unforeseen problems.
So, how do you choose the right property manager? First, it is important to ask the potential candidate a lot of general questions, such as:
• How do you handle property maintenance and repairs?
• What is your method for choosing tenants?
• How do you collect rents and fees? If tenants do not pay, what is your course of action?
• How do you advertise vacancies?
• Will I get monthly reports of the services you perform?
• What is included in these monthly reports?
Next, find out how long a potential property manager has been managing properties. Experience is the most important quality in a potential property manager because experience gives the property manager the ability to better deal with both expected and unexpected problems. The more hands on experience the candidate has, the more likely they are to appropriately manage your property. You want someone that has been through the trials and tribulations of being a property manager and who has learned valuable mistakes – at their expense. An experienced property manager will effectively serve you, without costing you money.
Different types of real estate pose different issues. Thus, make sure your property manager has extensive knowledge with your specific type of property. Also, make sure the manager has experience managing properties in your area. The more hands on experience a property manager has managing real estate in your location, the more likely the property manager is going to be able to successfully manage and maintain your investment. “Real world” experience cannot be substituted with theory or high levels of confidence. Therefore, the only way to ensure you hire a great property manager is to hire one with experience in managing properties.