Suggestions: Where to find a good property mgr and what Qs to ask

[Ryan Trollinger]

HI, I am looking to scale up my Real Estate investments in the next year and I think it would be great to have property manager onboard. I'd like to invest in a different state as the one I reside in costs too much to invest.

Would any of you all be able to share some insights on how you came upon a good property manager and what were some of the key questions you asked to make sure they were the right fit? 

I've newly joined Bigger Pockets and I think this place is awesome!

[Nathan Gesner]

Let me start by saying this: property managers are not all equal, just like renters are not all equal. How do you find a good tenant? Properly screening them. How do you find a good property manager? Properly screening them. It's funny to see so many people bad-mouthing property managers only to learn they just grabbed the first one they could find or the one with the lowest advertised rates instead of doing their research. Screening is key!

You can start by going to www.narpm.org and search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start.

1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their different staff qualifications.

2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.

3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 5% management fee but the extra fees can add up to be more than the other company that charges 10% with no add-on fees. Fees should be clearly stated, easy to understand, and justifiable. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate!

4. Review their lease agreement and addenda. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.

5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance or problem tenants. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that it is enforced equally and fairly by their entire staff.

6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact they are complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.

I hope this basic guide helps. If you have specific questions about property management, I'll be happy to help!