Dealing with suspected PM issues (maintenance bills)

[Miles Tiglao]

I have a PM that hit me with a large turn-over bill $2-3K.  They said they re-painted, did yard work, etc.  When I questioned the work (It looked like I got billed for re-painting twice) and asked for receipts and post-pictures of work done, I'm getting excuses/delays.

Other than firing them (which I plan to do because they've been substandard in other ways), do I have any recourse to challenge the maintenance costs?  They're taking away the maintenance off of my new lease/rent so I don't feel I have the option to refuse payment.
  

[Nathan Gesner]

Quote from @Miles Tiglao:

1. Your PM Agreement should have a limit to how much money they can spend without written approval. If it doesn't, you need to fix that right now. My PM says I can't spend more than $250 on a repair without Landlord approval.

2. Even when approved, they should provide you with an itemized list of charges, copies of the invoices, and/or pictures of the work completed.

3. If they refuse, you should absolutely refuse to pay. If they take it out of your income without your approval, you can file a complaint with the State Real Estate Board and that will probably motivate them.

You need to look for a professional property manager. Remember: cheaper doesn't mean you'll make more money.

Start by going to www.narpm.org to 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. You can also search Google and read reviews. Regardless of how you find them, try to interview at least three managers.

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 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 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. 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, particularly if you have a lot of rentals.

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, late rent, evictions, turnover, etc. 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 policies are 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 that a tenant is 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.

7. Look at their marketing strategy. Are they doing everything they can to expose properties to the widest possible market? Are their listings detailed with good quality photos? Can they prove how long it takes to rent a vacant property?

This isn't inclusive but should give you a good start. If you have specific questions about property management, I'll be happy to help!