Property Management Expectations

[Monique Munoz]

Hi all! I'm wondering if my expectations of my management company is too high or if I'm misunderstanding what they should be doing for me. Recently, I asked management to notify my tenants that we were going to increase their rent. I gave no specifics of timing and just figured that they'd know (or inform me) that we need to give a 30 day notice first. Well, a week later we get the rent payment at the increased amount! I'm not sure why they wouldn't have given the 30 day notice first. Even I know that should happen!

Also, they don't seem to know when our leases end. I figured they would give me a heads up, ask if I wanted to extend another lease out or just let it go month-to-month. Nope. I have to tell them when the lease ends, and what I'd like to have done going forward AND ask them to schedule an annual inspection. 

I've also had a previous company take forever to take care of urgent maintenance requests. :/

Is this typical? Or am I not getting my money's worth? I've worked in commercial property management and this all seems to be the opposite of what we did for our clients. 

[Nathan Gesner]

You asked, "Is this typical?" when you should be asking, "Is this acceptable?"

These behaviors are probably far more common than not, but they shouldn't be. Your manager does not understand basic Landlord-Tenant law. They apparently don't track their leases, communicate with the Landlord, or make decisions that are in your best interest. If I were in that situation, I would start looking for a new property manager immediately.

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 managers

1. 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!