Property Manager........They Stink. What to do?

[Andres Piedra]

I finally caved in and for the first time ever, I have put a property in the hands of a "qualified" property manager. I vetted this company well and it seemed like a good one to hire. However, after signing the agreement, it comes as no surprise to most I am sure, the company is a dud. It took them over a week to get the property on the market and now I have to be extremely proactive in order to get any information out of them. Needless to say, the property isn't rented yet and they will NOT be getting any business from me in the future.

However, I now have a contract with these people and it stipulates that I may be charged a $750 fee to break the contract. Has anyone ever been in this situation? How did you handle it? I definitely do not want to pay to break the contract, but also, I would really like a proactive property manager (who I think I have found already) who responds to my requests for information and returns emails and phone calls.

[Rob K.]

I had a similar situation a couple years ago. A property management company was highly recommended to me by another investor. I gave them three empty houses that I had. My hope was that all would go well and I would eventually turn everything over to them. It didn't happen.

They took a long time to get the homes up for rent and on their website. I have no patience and want everything done right now. After about six weeks of excuses, they finally rented out one house after knocking me down on the price. The contract that I had was also for a year, but had a clause where I could get out if they hadn't rented the house yet. I pulled back the two that were still vacant and rented them myself.

For the house that they rented, there were still problems. The tenant wanted some minor repairs done and the cost that the PM quoted me was outrageous. It was about $600 for a few hours of work and minimal supplies. I told the PM that I would send my own guy there to make the repairs. When I called the tenant, he told me he didn't need the issues fixed. He had just noted them on his move in checklist so he wouldn't be charged upon vacating. Next, I got a call from the PM that the fridge "had mold in it" and the tenant "wanted a new fridge". They wanted me to purchase a new fridge and have it delivered. I told them that if the tenant didn't like the fridge that was provided, he could buy his own. He did just that.

I rode the contract out for that year and cancelled it. My tenant stayed, was happy that the PM was gone, has been a great tenant to this day, and I save the PM's commission every month.

If I ever go the PM route in the future, it will be my own employee who has to answer to me and not someone else. Lesson learned.