What questions do I ask a potential contractor/property manager?

Question

I'm 16 and very new to real estate, I'm working for my dad right now and he's interested in buying multi-family homes and implement the BRRR method in Wichita. We live in California and he's planning to go out there in two weeks and asked me to do some research for potential contractor and property management companies. I've scrolled through people with these same issues and much of the feedback is to attend an REIA meeting, but he will not be there during the next one.

So, how do I start? What makes a good contractor? What makes a good property management company? When I've found a few potential candidates, what questions should I be asking?

Kristen Williams · Answer

Hello and welcome to Bigger Pockets. I am the President of Granite Key Leasing & Management, located in the Wichita Metro Area. There are excellent checklists out there that you and your family can use, which can be customized to fit exactly the concerns that you have. Many apps such as Zillow, or websites like realtor.com offer these to assist people in selecting a good PM.

Being on the receiving end of the selection, I also have a checklist that I developed when looking for good owners. As you have read already, the main part of property management is what is in the management agreement. It is a legal contract, usually for one year, that spells out line by line, similar to a lease, exactly what is expected of the property management company, and what the fees will be, maintenance threshholds and more.  Researching a PM can be difficult, because there are so many in Wichita, but most use the same type of marketing, hours of operations, brick and mortar offices, and similar channels. What you really want to do, is call them, interview them, get references, ask for a list of homes and multifamily properties, by address, that you can see the type of quality they maintain and manage.

Referrals are the most excellent way - references. Real estate professionals, bankers, investors, renters and more, can give you a well-rounded feel for that company. Also look at their online presence, ask about technology, what data they use, how they market and turnaround time.

Anyway, so glad you are doing the research, your family will do well to be in the Wichita market, it's an excellent time for this! Feel free to reach out any time.

Warm regards,

Kristen W.

Kristen Williams · Answer

@Shane H. where do I send your 5 million dollars (for the kind words!)? Thank you! I did enjoy meeting with you and having conversations. One thing that I have liked about Bigger Pockets is the knowledge that is out there! We have all met so many people, and find out we know the same people sometimes, that can help us grow, refer and prosper in our market. Wichita is such a great market right now!

Shane H. · Answer

@Manah Watkins

Welcome to Biggerpockets -- Fellow Wichitan here as well.  As Kristen said best to do your homework and referrals help, however I'd say actually interviewing a few property managers would be your best bet and whichever one you get the best feel from and in your opinion will be the best fit for you is the one I'd go with.

There's plenty who've been doing it for years but do not put an emphasis on customer service to tenants etc and are just check collectors - others will be more hands on.

@Kristen Williams   I've met with Kristen once earlier this year and have had a few conversations as well via bigger pockets etc with her - I manage my own properties presently, that being said if I were to ever turn the reigns over she'd be tops on my list to speak with after having met her.

To add another point above - if your folks will be looking for a solid property manager they need to find one that will specialize in the type of property they are going to buy -- IE will these be lower end class "C" rentals with lower income tenants etc, will these be class "A" rentals with class "A" highly desirable tenants who desire and will need solid customer service etc?  Find a PM who will and does work in the specific type of property they are going to buy.

I do manage my own and one other for another owner and prefer to manage properties that are Class "B" or higher.  Lower end rentals would not be a good fit for me to take on for example, however I do work well with class B or higher rentals which is where all of my experience lies.

Monica Rivera · Answer

Hello Manah,

Another resource would be to connect with Realtors in Wichita to see what resources they have in their arsenal. I may have a few I can refer. Also, in terms of property management, I owned a PM company for a # of years. You are going to want to know all of their fees (usually it will be a % of the monthly rents, but can include marketing, leasing and turnover cost in addition to management fees), at what cost point they need owner approval for repairs, what type of reporting they do (usually weekly or monthly depending on turnover rates for the area). Also do they handle the turnover and leasing. Do they go to court in case of eviction or other issues. What do their occupancy and turnover rates look like. Also another key is if the PM company owners own or have stake in any of the properties. This can create bias sometimes to lease their own properties first which can be a problem especially as you would be out of state owners.

I'd be happy to get on a call with you if you'd like to discuss more. Just shoot me a message.

Thanks,

Monica

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