How to find a good Property Manager

Question

How do we find a good Property Manager in Virginia Beach? We've read all the typical interview questions (like how many units do you manage, etc.) but I have some real questions... Why do you charge that huge Leasing fee if professional pictures are not done and most advertising is free? Where do you find your maintenance contractors? Do you inspect repairs made before you pay the invoice? Do you require (when possible) before and after pictures for repairs made? Can the owner participate in the semiannual inspections? How do you keep up with normal maintenance on the property?

Am I asking too much?

Thanks

Am I asking too much?

Thanks

Nathan Gesner · Answer

@Alisa Gerald

Remember: cheaper doesn't mean you'll make more money.You can 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. Regardless of how you find them, try to interview at least three managers1. 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, 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 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.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!

Nathan Gesner · Answer

I manage 350+ rentals. I use trusted vendors and rely on them and the tenants to notify me when work is complete. If it can be visually confirmed, like patching a hole in the wall, we ask the tenant or vendor to send us pictures of the completed work. If it's a clogged toilet, pictures won't help and are completely unnecessary: either the toilet flushes or it doesn't.

If an owner asked to inspect their property, I try to accommodate them but I require them to give reasonable notice to my staff so that we have time to schedule it with our office and the tenant. I try to ensure owner and tenant do not meet or communicate. I would not conduct more than one inspection a year with the owner. Either they trust me to do the job or they don't and can find a different manager.

Lynn McGeein · Answer

Alisa, For our properties that are 3 hours away, we plan on inspecting at least once a year and we try to do it around one of the turnovers so we can focus on one and do minor fixes on others.  We'll fix anything we can do while in town, then management takes over.  Our PM is very landlord-friendly -- they'll leave a lockbox at their office with keys after hours on a Friday night, give tenants notice of inspection, provide estimates beforehand so we can decide what we'll do or leave for them.  Our long-term tenants actually will leave a list of things they'd like us to do while we're there (fix a gate latch, loose towel rack, etc.) and it's saved a ton on what we call  "stupid trip" fees, where paying expensive handyman trips for minor issues was a constant hit to cash flow.  You'll find neither tenant nor management pay much attention until a problem arises, so owner monitoring and maintaining is important -- exterior trim, deck stain, crawl space vents, drainage issues, we look under all sink cabinets for water issues as most don't until it has done damage, etc.  I know some busy PMs here have said they don't want owners inspecting or meeting tenants, but our PM is a big company that understands it's a working partnership with management and owner.  It's our investment, a large one, and unless a PM agrees to cover all things they've missed or neglected and keep it as the owner would, they should understand that owners are inspecting periodically and maintaining their investment.

Account Closed · Answer

@Alisa Gerald the leasing fee has to do with all the time a leasing agent has to spend fielding phone calls, screening potential tenants and showing the unit. It typically takes 7 or 8 inquiries to get one showing and unless you are in a market with a shortage of rentals, it may take many showings to get it rented.

You may be able to get a property manager to reduce or waive the fee, but that also means your property will not be their top focus when they are working on renting vacant units in their portfolio.

Owners are quick to complain about fees, and some management companies have excessive fees. However, good property managers need to be compensated for doing a good job.

Lynn McGeein · Answer

Finding good property management can be as difficult as just managing it yourself.  @Patti Robertson has a very good reputation locally.  She may be able to help or at least answer most of your questions.  Read all management contracts thoroughly.  You'd be amazed at how different they can be, and you'll need to research any provisions that seem off.  In Washington State, management companies I spoke to all seemed reasonable, but then had clauses hidden within their management agreement stating I'd use their lawn service for excessive fees all year, or have all window blinds cleaned by their window company annually for $40 per window, all kinds of weird stuff.  When I asked them to remove those clauses, they refused.  It took me months to find decent management there.

Christine Kankowski · Answer

Interviewing is a good way to find out if a company is a right fit for you.  Diff companies do things differently.

WE are full service, and don't want the tenants having any info on the owners- therefore we don't allow owners into annual interior inspections.   When the property is vacant, they are welcome absolutely.

WE charge a lot for placing new tenants, because it is the most important and the most time consuming aspect.  Although most advertising is free, the MLS is not (pay another agent) we still need to field all the calls, answer all the questions, set up the showing times, do the showings, screen the applicants, negotiate move in dates, do move in inspection, move in meeting, etc.   We can also keep our monthly pricing lower, when charging for the most laborous area.

I hope that helps.  I am an investor as well as a property manager.

William Joseph · Answer

I am never offended or annoyed when I am interviewing a new client and they ask questions. A lot of PM contracts and agreements are cookie cutter. I normally don't mind tailoring a service contract to the needs of an investor. In fact, I encourage the participation because I get an insight into your expectations and what you value. With that said, my willingness to negotiate and be flexible is also on a sliding scale of how many doors you own. For example, I would never negotiate my leasing fee on a single family house but I would give you the option to get it rented yourself if you wanted to save the money.

Lucia Rushton · Answer

@Nathan G.  An outstanding list of questions and the reasons behind them. I will refer all my investor clients to this post as you really took the time to succinctly reply to the post - thank you !

Kevin Sack · Answer

@Patti Robertson is my manager in the area. I'll parrot what others have said about price vs what you get. Patti is a professional and has years of experience in the market. She is always willing to answer my questions and will always give you a straight answer. When it comes to business decisions, that is the kind of person you want in your corner.

Ben Halabi · Answer

Hello Alisa, a lot of people ask if they can talk to an existing client that works with the company. I will try and ask for that. Most of the time other investors are open to talking about their experience with the company they are working with. But of course, the company must get the OK from the owner before giving you any information. Goof luck!!

How to find a good Property Manager

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