Property Manager (PM): Hire, Fire and Monitor

[Keith Kennedy]

What are the traits of an excellent PM? When is it time to fire the current PM? How should a smart REI monitor the PM? Thank you in advance for your great advice!

[Peter MacKercher]

I'd say there are three main traits of a good property manager: transparency, competence and ethics. 

Transparency: Do they keep you updated about what's happening at your property? Tenant issues, property issues -- depending on your desired level of involvement, they should let you know about anything that comes up when it does, not a week or a month later. I'd also want regular summaries of anything notable that's happened at the property (I include a monthly email summary of anything notable for my clients, timed with when I'm sending out checks). 

Competence: How much can they do in-house? Can they handle tenants properly? Collecting late rents while maintaining a good relationship with the tenant, being able to fix small issues at the property without having to bring in contractors, those are all important considerations because they'll directly affect how much you profit each month.

Ethics: Is the person/company ethical? This is hard to see right away, but if you notice that they don't treat their staff or clients well then I'd be wary. If their tenants and employees tend to be long-term then that's a good sign.

When to Fire Your PM

It's time to fire them when you no longer get along or when you've lost trust in what they're able to provide you. Either of those are a clear sign that your goals no longer align and it's best to part ways.

How to Monitor Your PM

As for monitoring, early in the relationship communication is key (this is basically the same thing as transparency). They should let you know what's going on while your working relationship becomes established. Later on things can be more hands-off since that's the point of hiring a property manager. Let them do their job so you have time to focus on whatever else you're pursuing. If things are running like clockwork then all is (usually) well, but if a bunch of surprises start popping up, ask for more communication until you're satisfied things are OK.