Rental properties are a worthwhile investment, but being a landlord requires much more than collecting rent checks. Do you have a plan in place if a pipe breaks? What happens when the AC goes out in the middle of the summer? Are you prepared to handle pest control and HOA packets?
Tenants regularly have maintenance issues that are often urgent. Property management companies often promise quick and long-lasting solutions. Read on for everything you need to know about finding a company that can meet your needs and makes your life easier.
What is property management?
Property management is the oversight of residential or commercial real estate. Sometimes, this can be a single contractor serving as a third-party representative.
However, property management often comes in the form of a company that oversees many different properties. This may be around a dozen for boutique businesses, while large property management companies may have hundreds of properties on their roster.
Most property management companies also offer a wide range of services. Although every company is different, these often include:
- Advertising vacant properties
- Tenant screening and selection
- Drafting contracts and accounting
- Monthly rent collection
- Receiving and completing maintenance requests
- Sorting through these services and determining your need is an essential first step as you search for a property management company.
Finding the right property management company
- Once you know what you’re looking for, it’s time to get to work. Finding a high-quality property management team doesn’t have to be complicated.
- Here are three tips to help you find the right company:
- Ask for referrals
- Do some research as you begin to search for a property management company. Ask people you know and trust for referrals. If you have colleagues or friends in the real estate business, they may have already done the heavy lifting in this area.
Once you have a few ideas, don’t be afraid to go take a look at properties. Rent prices are up across the country, meaning tenants expect to get what they pay for. You want to make sure you’re on board with a company that will help you keep your properties in great shape.
Focus on quality, but keep it local
If you’re managing your rental properties from another city (or perhaps another state), it helps to have a local property management company. It doesn’t matter how large or reputable a company is if it can’t be there when you need it.
This will make things a lot easier when it comes to fulfilling maintenance requests, along with keeping high-quality tenants.
For sellers, the top fear is a home that takes too long to sell. Similarly, real estate investors worry about houses that sit vacant without renters for months on end. One of the best ways to avoid this is to have boots on the ground locally.
Conduct thorough interviews
It’s important to vet multiple companies before you sign on the dotted line. Take time to conduct interviews with at least three different property management companies. This will give you a chance to determine who seems trustworthy and dependable.
Here are a few ideas to get the conversation going:
- Do you have a strong track record when it comes to tenant screening?
- What do you charge for your services?
- Are there any other fees to know about?
- How quickly do you respond to maintenance requests?
- What is your process for collecting rent from tenants?
Don’t be afraid to ask any other important questions that need answers. You should walk away feeling confident that your rental properties will be in good hands.
How to work together
You’ve found the right company and now it’s time to get to work. Fostering a great relationship with your property management company is essential. This will ensure you have happy tenants who want to stay long-term and pay rent on time. Fortunately, this isn’t too difficult to accomplish if you’ve found the right company.
Stay in touch
Find every possible way to communicate with your property manager. Whether it’s a monthly conference call or a quarterly face-to-face meeting, you must stay in the loop.
Additionally, a solid property management company will provide regular reports and other informational real estate forms regarding your property. Make sure you read through these and use them to guide accounting and maintenance decisions. Communication is key to a harmonious relationship with your property manager.
Keep everything in writing
Although most reputable property management companies will do this automatically, it’s worth noting that contracts are important. Study yours carefully before signing, and refer back to it whenever you have a question or concern.
Further, it’s important to disclose any stipulations you have. For example, if you want to put a cap on how much is spent on certain repairs, make sure this is noted in your agreement. Whether this is $200 or $500, choose what you’ll allow and put it in writing.
A detailed contract will keep everyone on the same page and aware of the expectations.
You chose your property management company for a reason, and now it’s time to trust the team they put in place. They should feel empowered to make the right decisions on your behalf. Provide context when necessary, but resist the urge to control every move they make.
Although communication is important, micro-managing won’t help you foster good working relationships. This is especially true when it comes to a property management provider. Show your property management company that you’re confident in their qualifications by letting them do the job you hired them to do.
Article written by Luke Babich from Inman.