Hello BP community,
Happy New Year! I am a new real estate investor and I closed on my first duplex in November in Lakewood/Tacoma, WA area. Tenants were placed in both units by a previous property management company (Company A). I hired a company (Company B) that was recommended by my real estate agent; however, the data points don't seem to be pointing in the right direction and I could really use some advice. I know that PM companies are not entirely perfect and would require some level of management from an owner, but this seems like a lot. Is this normal?:
During onboarding, the wrong checking account number was copied and pasted from the PMA to Company B's dashboard. Had to follow up.Was asked to mail the tenant security deposits to Oakland, CA (~20 miles away from me). The check was mailed on 11/26. I followed up a week later and was told it was "not received". It cannot be confirmed whether it was misplaced. USPS has not found it to date. Stopping payment cost me $25 with my bank.In December, tenants were still sending maintenance requests to Company A. That company contacted me and I told them to inform the tenants to use Company B's portal. I cannot confirm if the tenants were fully aware/informed of the transition to Company B.December Rent: By Mid-December, rent was not collected from both units and the dashboard said 0%. I had to actively inquire about it before I was told that rent was not collected. I had to call Company A and I discovered that both tenants submitted rent to Company A. I had to chase the rent from the previous owner and he sent over what he received from Company A which was $300 short of the total rent. Company A required a 30 day notice to cancel and the previous owner placed the cancellation on November 12, when the property closed on November 15, which is how the money was able to go through. I am assuming Company A took out $300 to cover property management fees, etc. I had to explain to Company B that the amount received was not the full amount of the rent and asked for them to help to follow up with the previous owner regarding the remaining $300. At the moment, I would be paying for Company A's fees, who I did not have an agreement with. I was told by Company B that following up on the $300 is "out of scope" because it relates to the previous owner and Company A. My response was that had the transition been a lot smoother and the tenants were well informed, we wouldn't be in this situation of having to chase down the rent money. If the tenants paid through the Company B portal, the full rent would've been sent to Company B and what is left between the previous owner and Company A would be separate and irrelevant. As a result I did think it was in scope and the right thing to do, especially since I was promised a smooth transition during the on-boarding call and have been paying Company B to manage the property (including rent collection) since November 15. Senior management of Company B agreed to cover the missing $300. They asked for the contact information of the tenants, which they did not have on file. This means they did not communicate to the tenants during the transition.Accounting issues: income for December was recorded as the full rent amount when only part of it was received from the previous owner via Venmo. I followed up with Company B to clarify that the December rent amount collected was not the full amount and that Company B decided to pay out the remaining $300. I wanted to confirm that the PM fee % is not based off of the full rent+300, when it should be based off Amount received+300=full rent. Company B agreed that it should be charge based on total rent amount. The ledger ended up showing a higher PM fee, which charged the full rent+300. I had to send Company B a message to make the appropriate correction.Around Dec 6, maintenance request for a mailbox fix was submitted. I followed up on the request on January 13. “The request was simply missed by our repair and maintenance team”.On January 13, I had to follow up with Company B to close the request for a refrigerator, since I replaced it on December 27.This seems abnormal. The only good thing about Company B is that they are very responsive on their portal, but every little action item seems to require handholding and correction. I am worried that transitioning PM companies within a short period of time would fatigue the tenants; however; neglecting a maintenance request would be frustrating for me if I was a tenant. Has anyone experienced something like this before? Is the grass greener on the other side? Does anyone have any good PM companies that can be considered that cover Lakewood/Tacoma, WA area?
Thanks in advance,
JL
