Are we expecting too much from our property management firm?

Question

Since we live 4 hours away from our properties, we have a property management firm.

A year ago we personally inspected the properties prior to putting them on the market for sale. We found the condition of one house alarming. Every room was extremely cluttered with trash and were filthy. We asked the management firm to address this situation and to make regular visits to ensure the house was clean. We even offered to pay for a monthly cleaning service.

The tenants moved out this summer without notice. (Due to a medical situation we were aware of, although it wasn’t right, it is understandable.) They left furniture, clothes, trash- everything – which we paid to have hauled away. We also hired an exterminator since every room was infested with cockroaches and other bugs. Our painter found that there was food left in the refrigerator...and the tenant moved out 3 months ago.

Are we out of line to be upset with the management firm for not inspecting on the property, allowing it to get in such a state? Is it normal for the management firm to do a periodic walk through of the property to check the condition of the house and the mechanical systems so problems can be address before they get too bad?

Account Closed · Answer

Yes, you're right to be upset.  In my opinion, most property managers will not improve your bottom line.  Sad, but true, and sorry for the PMs out there who actually do improve an owner's profits - you are rare, in my experience, as both someone who has hired one, to being the mother of a daughter who was royally ripped off by one, to being a friend of someone royally ripped off by one....and as a former on-site manager and self-managing rental owner who knows what it takes to manage a property well.  It's not that hard.  There's no excuse for what you encountered, in my experienced opinion.

Nathan Gesner · Answer

I disagree with Tim. As a property manager, I have three responsibilities:

• Protect your property
• Protect your income
• Protect your time

You don't say how long the tenants lived in the home before discovering the problem so it may not be the managers fault for not knowing the condition. However, once the problem was identified, your manager had a responsibility to get it cleaned up or get rid of the tenant. Instead, they allowed it to continue to degrade. They failed on all three of their responsibilities.

My job is not to tell tenants how to live unless their lifestyle is damaging the property or interfering with another person's right to quiet enjoyment. It also sounds like the tenants moved out and your manager failed to act. When rent is late, it should trigger late fees and attempts to collect. Once rent is 10 - 15 days late and tenant is not communicating, that should be a trigger to visit the property and see if they've abandoned, died, burned the place down, etc. That your manager allowed this to go for three months without inspecting the property is outrageous.

What you have is a glorified rent collector, not a professional property manager. I would fire them and consider suing them for failing in their fiduciary responsibilities. At a bare minimum, I would document everything and file a complaint with the state regulatory board. Maybe their license would be pulled and you can prevent this from happening to others.

Tim S. · Answer

Most will do a walk through once or twice a year.  They should do it anytime you request, you'll have to pay for it though.  It's not their job to make sure the tenants aren't slobs though.  They are paid to find tenants, collect the rent, fix things when it breaks.  You can't expect them to police how people live inside the property.

But they were gone for 3 months and the PM didn't take any action?  That is a big problem.  When the rent stopped coming in they should have taken action.  What did you do when the rent stopped coming in?

Jay Hinrichs · Answer

check out their car can give a good indication of basic cleanliness.. or lack thereof.. also if their cloths have those tell tail odors.

Steve Vaughan · Answer

I wouldn't necessarily blame the PM for the tenants being pigs, but 3 months vacated and no action?  Their apathy will cost you every time.

The best way I've found to avoid a pig is to stop by their current residence when I am screening their application.  I wouldn't expect a PM to do this, but I would hope for a higher quality tenant placement in the future.

A PMs placement fee should represent the quality of tenant they place, but it doesn't.  They are all paid either way, up front, in full whether they spent 10 minutes placing the first mirror fogger or dug deep for 2 days on your behalf.

Jobie DeVinney-Walsh · Answer

Lots of information here, guys, Thanks.

In all fairness, I want to be clear -

1.) the Property Manager went to visit the property when the 2nd month rent came due and wasn't paid;

2.) since our tenant had a terminal diagnosis, we asked the PM to give them some flexibility. However, her parents, who lived with her were instructed, in writing, that they MUST let us know that there were issues. If they did that, we waved the late fee. On a couple of occasions, I believe they did that.

3.) The tenant lived in that house 3 years. They lived in another house we owned for a year, but when her condition deteriorated and she needed her parents to move in to help, we offered another house we owned that had a finished basement with two bedrooms, full bath, kitchenette.

4.) A year ago (Oct of 2018) we found the house in deplorable condition. The PM told us that was grounds for eviction. However, we didn't feel right to put a dying woman, her children and care-giver parents out on the street. That's why we offered to pay for a monthly cleaning service. At our request, the PM agreed to keep an eye on the situation.

Our PM doesn't do any repairs. They let us know when a repair is needed and we tell them to send one of their people up or we find someone. Unfortunately, we get complaints from tenants that they wait months before the PM responds to a call about a problem. Consequently the tenants call us first. We have our own team of contractors we call when necessary.

If a PMs sole job is to collect rent, then a pre-paid self addressed envelop is a whole lot cheaper than the almost $100 per house we currently pay. (Apologies to all PMs who do a good job watching the properties in their care.)

We fully intend to fire this PM. I'm turning to you to help me determine if we contract with another firm and what to look for. I doubt that we will pursue legal relief since it can be argued that our compassionate treatment may be a contributing factor.

One final point: One of our houses is surrounded by trees. We asked the PM to send someone up there a couple of times to clean the gutters. They claimed they were doing that. It cost us about $2000 to replace an outside wall that collapsed due to water overflowing the gutters and draining down the wall for months - even years. We should have learned then that we couldn't depend on them.

(Besides giving me your great advice, I truly appreciate that this forum gives me space to vent!)

Are we expecting too much from our property management firm?

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