Is PM company overcharging for repairs? Any honest PM out there

Milwaukee, Wisconsin
Milwaukee Real Estate Forum
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Is PM company overcharging for repairs? Any honest PM out there

Balu Natarajan
Member since 2019 · 6 posts · 3 votes

Hi, This is my first post. Been a passive member for a while. I have 7 units, 4 buildings in Milwaukee managed by a reputed Property Management company. These are some of the repairs charges they have charged me over the last year or so. I have asked for transparency on the repairs. Company refused to provide any kind of transparency to these charges. I have asked for all these in these past only to be refused by the company>

  • Details of work order/repair request submitted by tenants
  • Details of before and after pictures for certain major repairs such as drywall
  • Details of invoice breakdown such as parts, labor or hours

The company would not consult with me on any repairs except once they checked with me for a $1700 water heater change out.

These are some of the recent ledger entrees: Do these seem reasonable for Milwaukee area. To me they are not. I managed my own properties for 3 years before becoming long distance invester.

  1. Door lock change out - $245
  2. Adjusted supply air to move towards the room - $246
  3. Garage service door repair - $245 (no details of what repair)
  4. Bagged and hauled away wood from trees - $175 (on a property with no tree or wood around)
  5. Gas oven, gas leak adjusted and tightened line - $248

In addition routinely charging me for grass cutting and snow cleaning when leases clearly say tenants are responsible. I have been shopping around but afraid that I will switch our one bad actor for another.

Any advice? Are there any honest PM companies. I need someone who can be upfront about their upcharges, 10% or whatever and be willing to be transparent with invoices, repair details with photos as applicable.

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Marcus Auerbach
Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes
5y

This does seem excessive, especially for labor only jobs. Maybe the cost can be justified, but you should expect transparancy on what exactly was done etc.

Being a PM is not easy, owners expect work to be done by a skilled and licensed contractor, who of course gets a salary, also benefits and work truck, not to mention a mark up for the PM to actually make a profit. 

He has to go to the job, find out what the issue is, then drive to HD, to get the necessary materials, stand in line at the check out, then drive back and actually do the work. It's easy to burn up half a day on a seemingly small job. Oh and the guy also gets paid where there is no work to do... Owners often look at this and think I could have done this myself for and the parts were only $25 and now they charge me X.

We self manage and have an internal team, but if I would hire a PM it would be Welcome Home Milwaukee. They have a flat fee model, check with @Ed Riggenbach. The only issue is that they are selevtive and wil not take on units in the hood; they know better.

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  • Marcus Auerbach
    Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes
    5y

    This does seem excessive, especially for labor only jobs. Maybe the cost can be justified, but you should expect transparancy on what exactly was done etc.

    Being a PM is not easy, owners expect work to be done by a skilled and licensed contractor, who of course gets a salary, also benefits and work truck, not to mention a mark up for the PM to actually make a profit. 

    He has to go to the job, find out what the issue is, then drive to HD, to get the necessary materials, stand in line at the check out, then drive back and actually do the work. It's easy to burn up half a day on a seemingly small job. Oh and the guy also gets paid where there is no work to do... Owners often look at this and think I could have done this myself for and the parts were only $25 and now they charge me X.

    We self manage and have an internal team, but if I would hire a PM it would be Welcome Home Milwaukee. They have a flat fee model, check with @Ed Riggenbach. The only issue is that they are selevtive and wil not take on units in the hood; they know better.

    4Reply
  • Balu Natarajan
    OP
    Member since 2019 · 6 posts · 3 votes
    5y

    Thanks @Marcus Auerbach  

    0Reply
  • Matthew Irish-JonesBusiness Member
    Real Estate Agent · Buffalo, NY · Member since 2017 · 2k+ posts · 2k+ votes
    5y

    @Balu Natarajan. There should be clear operating procedures in your contract. Over a certain dollar figure usually needs owner approval. Most PM’s provide before and after pictures for maintenance for both the owners protection as well as for the PMs protection. If a tenant stops paying due to a maintenance request you need to be able to prove you handled the repair with pictures.

    You should not be surprised by phantom charges. There should be open communication between you and the PM and you should be able to easily get answers on your questions.

    Regardless of your contract this is basic customer service your PM should be providing.

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  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    5y

    Do they have their own staff doing these repairs, or are they being hired out? If they are being hired out, charges seem fine to me.

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  • Balu Natarajan
    OP
    Member since 2019 · 6 posts · 3 votes
    5y

    Thanks @Marcus Auerbach  

    0Reply
  • Balu Natarajan
    OP
    Member since 2019 · 6 posts · 3 votes
    5y

    @Russell Brazil, These are repairs by own maintenance staff.

    @Matthew Irish-Jones Thanks for those suggestions. These are just some recent samples. Have been raising these kind of charges for more than a year, without much resolution.  

    0Reply
  • Dawn AnastasiPro Member
    Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
    5y
    1. > Door lock change out - $245

    For a deadbolt and handle lock, this should take about 10-15 minutes. Not sure how they got up to that charge.

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  • Drew SygitBusiness Member
    Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
    5y

    You should terminate this PMC --- after you find a better one!

    Hpoefully, you've learned from this experience and will make sure EVERYTHING to meet your expectations is in writing in the management contract.

    In our experience, the #1 mistake landlords make when selecting a Property Management Company (PMC) is ASSUMING instead of CONFIRMING.

    It's often a case of not doing enough research, as they don't know what they don't know!

    Landlords mistakenly ASSUME all PMCs offer the exact same services and operate the exact same way, so price is the only differentiator.

    So, the first question they usually ask a PMC is about fees - instead of asking about services.

    This also leads them to ASSUME simpler is better when it comes to management contracts.

    The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it.

    We have a 12 page management contract that we've added our real experiences to over the years, with the intent of protecting both us AND the landlord. Beyond the Monthly Management, Placement & Maintenance fees, all other fees in our contract are IF EVENT -> THEN fees.

    We don’t know any PMCs to recommend in the area mentioned, but since selecting the wrong PMC is usually more harmful than selecting a bad tenant, you might want to read our series about “How to Screen a PMC Better than a Tenant”:

    https://www.biggerpockets.com/member-blogs/3094/91877-how-to-screen-a-pmc-better-than-a-tenant-part-1-services-and-processes

    We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

    EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

    P.S. If you just hire the cheapest or first PMC you speak with and it turns into a bad experience, please don’t assume ALL PMC’s are bad and start trashing PMC’s in general. Take ownership of your mistake and learn to do the proper due diligence recommended above😊

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  • Ed Riggenbach
    Property Manager · Milwaukee, WI · Member since 2014 · 65 posts · 38 votes
    5y

    Thanks for the shout out @Marcus Auerbach

    @Balu Natarajan I'd be happy to chat about options and if we can do better for you. Without more information, I have no idea if these charges are high or not. However, there should be no reason to not give you more information. Feel free to shoot me an email and we can look at what we do differently to get you the transparency you're looking for. 

    2Reply
  • Balu Natarajan
    OP
    Member since 2019 · 6 posts · 3 votes
    5y

    @Ed Riggenbach, Thank you. Will be in touch.

    0Reply
  • Balu Natarajan
    OP
    Member since 2019 · 6 posts · 3 votes
    4y
    @Drew Sygit, Thanks for your comments. you are spot on. That is exactly what I have been doing.  Reading up on contracts from many PMs. I have been gathering some of my thoughts around these topics on what to look for pitfalls or positives in PM contracts.  Thanks for sharing your link. That is very relevant.  
    0Reply
  • Daniel HymanBusiness Member
    CPA · Milwaukee, WI · Member since 2016 · 2k+ posts · 1k+ votes
    4y

    You might want to reach out to @Chaim Lampert who is a very honest and reliable PM.

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  • Chaim Lampert
    Milwaukee, WI · Member since 2019 · 54 posts · 44 votes
    4y

    Thanks @Daniel Hyman

    @Balu Natarajan, feel free to reach out if I can be of any assistance.

    0Reply
  • Jon Westrom
    Property Manager · Fort Worth, TX · Member since 2014 · 77 posts · 29 votes
    2mo

    What you're describing is exactly why so many owners eventually come looking for something better... a PM that won't share invoices or before/after photos isn't a partner, they're a liability. We charge zero markup on maintenance — you pay exactly what the vendor invoices, nothing more, and the receipts are there if you want them. Transparency isn't a feature we offer, it's just how we've operated for 30 years. There are honest operators out there — you don't have to choose between "bad" and "unknown." Don't let the fear of switching keep you in a bad situation longer than you should be.

    0Reply
    • Drew SygitBusiness Member
      Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
      2mo
      Quote from @Jon Westrom:

      What you're describing is exactly why so many owners eventually come looking for something better... a PM that won't share invoices or before/after photos isn't a partner, they're a liability. We charge zero markup on maintenance — you pay exactly what the vendor invoices, nothing more, and the receipts are there if you want them. Transparency isn't a feature we offer, it's just how we've operated for 30 years. There are honest operators out there — you don't have to choose between "bad" and "unknown." Don't let the fear of switching keep you in a bad situation longer than you should be.


       WHy you responding to a 5+ year old post?

      [email protected]248-209-6824
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