Paying 1st month's rent to PM if you find your own renter

[Ken M Middleton]

Hey BP,

I'm looking at getting into my first property management agreement, and I'm pretty sure that I can find and screen a tenant on my own and would only need a PM company to maybe do potential showings for me since I'm not in the area.

With this being the case, is it reasonable to pay the first month's rent if I'm doing all the advertising and screening to get the tenant in place, or is showing the property enough to ask for the first month's rent?

Also, with that being said, has anyone had any experience allowing tenants to see the property on their own with a lockbox (similar to Open Door self-viewing service), or is this a bad idea?

I appreciate everyone's insight on this in advance!

KMM

[Nathan Gesner]

Originally posted by @Ken M Middleton:

Hey BP,

I'm looking at getting into my first property management agreement, and I'm pretty sure that I can find and screen a tenant on my own and would only need a PM company to maybe do potential showings for me since I'm not in the area.

With this being the case, is it reasonable to pay the first month's rent if I'm doing all the advertising and screening to get the tenant in place, or is showing the property enough to ask for the first month's rent?

Also, with that being said, has anyone had any experience allowing tenants to see the property on their own with a lockbox (similar to Open Door self-viewing service), or is this a bad idea?

I appreciate everyone's insight on this in advance!

KMM

Ken, whatever you negotiate with your property manager, make sure it's clearly spelled out in writing and agreed to with signatures so you don't have problems down the road.

Here's my concern: the most important aspect of property management is application screening. If you're better qualified to screen applications, then I would argue your PM is not worth hiring. 

I occasionally have owners tell me they want to be involved in screening applications. My response? My office screens almost 1,000 applications PER YEAR. Most Landlords don't even screen 1% that many. How would a Landlord possibly have screening skills that surpass mine? They wouldn't, and they are more likely to make mistakes or do something that exposes us to a Fair Housing complaint. 

You should have a PM that is an expert at screening and selecting renters. If you don't, I recommend you look for another one.