Property manager that doesn't profit when things go wrong .

[Sharon R.]

So if you read my previous post regarding the terrible PM i had you must 

know that i had my share of terrible PMs who know only to collect the 

rent and their fees and nothing else. 

So I was fed up with it. 

I started to interview a few.  I have one for my investments in Vegas so I was 

basically looking for a PM for my Atlanta's SFHs, 

I talked to a few. some sounded nice, some were vain enough to say that 

700$ house is not in their range, but if I give him all my hpuses in Atlanta to manage

then he will take it. I heard that from a few of them. 

but that wasn't what had really set me off. 

so they take 10% of rent income, some of them were willing to negotiate to 8% if I was

to give them the other houses as well, 

10% service if something breaks and he/she needs to go fix it, (10% or min service 

fee of one visit is 35$) 

one month rent for finding a new tenant (even if tenant only stayed for 2-3 months) 

1/2 a month rent for renewing an existing lease with the same exact terms! 

and more and more "pay for this, pay for that extras" 

when I said "but If I pay for each time there is a service call, or every time there is a need 

for changing a tenant and having them resign a lease... then what is the managing 10% fee for?!!!

they all answer with "this is for managing..." 

"but, but.." i said "you just specified all the things you do and how much are they 

going to cost me. so what is managing?" 

and they all "remembered" - yes, for collecting the rent and distributing it to you 

"so what you are basically saying is that i am paying the 10% fee every month to 

have you collect (which is in most cases done by an automatic setup with an automatic 

draft from the tenant's bank account) taking out your fee and making me wait another 5 days 

to have you send what's left of the money?" 

they all said: "you can put it this way if you want..." 

but this is what it is. 

they all hated to hear that. and why won't they? they got used to a standard of charging 

a basic fee for nothing. 

I hated it. 

I found a really intelligent woman, who had experience in real estate, (as a broker) 

and who had done these kind of things for renovation process and who had just finished 

her property management class. I offered her this deal: 

I give you not 8, not 10% of the rent, I give you 15% 

but... it includes everything. 

if all goes well, for a 900$ rent you get 1620$ a year (135$ a month) but if the house is 

vacant, you loose that month, so the 15% is of 10,800 minus the months it was vacant. 

there were more stipulations to this contract which basically makes her want to take care 

of the house like it was her own. 

If you are interested i be more than happy to show/ tell  you. 

I thought I should share this with you because it can really help set things right 

making both sides with the same interest.

[Catherine German]

everything is negotiable when you sign up for property management services. you are the customer. if someone makes you feel uncomfortable or if you think they are in it for just the fees, RUN DON'T WALK away from the negotiation table.

[Jay Hinrichs]

@Sharon R.  if you think home warranties are going to cover your maintenance .. then you will be in for a rude shock there.

. I don't think you also understand that in the south probably 50% of the tenants Have NO checking account.. so therefore they don't have a checking account app LOL.

if you have class A properties that's one thing but if your buying standard B and C class rentals .. these are tough to manage.. and me personally I would not do it for any where near what all these folks charge its not nearly enough to go along with the brain drain and how hard it truly is.

[Sharon R.]

@Jay Hinrichs, like I wrote before, they are all renovated. I also pay for the 

most comprehensive HW program so it does cover 95%

[Sharon R.]

@Jonathan R McLaughlin, I agree. we all want to make a good living, 

so this is why I gave my PM a 15% offer and nothing less; this is also why I  

moved all my houses in Atlanta to her managing. when you do the number you will see, 

fast enough, that 135$ (an average monthly fee) adds up to a full monthly rent...you can 

say it's like owning a house  without actually buying it. 

so, I believe. I have created something that is a win-win. 

[Sharon R.]

@Steve Vaughan, 

thank you Steven. 
I was under the same impression myself... thinking "this is so bad..." 
but the more I got into it, I thought I have much to offer, so with that 

kind of thinking I started to write my own PM agreement. 

I was thinking - how do I make both sides "safe enough" to want to do the best 

for each other. I believe this formula is a winner, but you know what - 

life is dynamic, if i see it doesn't work as well, then I can change it - 

yes, I also put exist terms in it, for both sides. it's not a Catholic marriage... (actually

these days you can get out of that too :) 

[Sharon R.]

Originally posted by @Catherine German:

everything is negotiable when you sign up for property management services. you are the customer. if someone makes you feel uncomfortable or if you think they are in it for just the fees, RUN DON'T WALK away from the negotiation table.

 I agree :)