Need to switch Property Managers…

[Justin Thind]

My SFM closed on June 23rd. It’s now August 23rd, and ZERO work has started. I put 8 of those 60 days on inactivity on me because I’ve been sitting here weighing my options, but 52 days of no working being done on the interior, electrical, attic, foundation, roof, etc.

After it took weeks and weeks to get estimates on those things, I got very inflated estimates on everything except the interior flooring (which seemed fair). I got quoted $4k just to remove some concrete before doing $25k of work on the foundation, when the inspector told me pre-purchase that the overall project should be about $7k. I even got quoted $500 to throw dirt around the exterior of one corner of the house to cover exposed foundation (a bad of dirt is $2.97). Moreover, the communication is not good. As a first time investor, I was told by the owner that they’d be my advisors and mentors in this process. Instead, it’s me constantly having the nudge them to do any work, and then only getting 30% of the estimates back every time I list to them what is needed (even though it’s truly their job to identify what is needed. Thank god I’m not an out of town investor lol)

Anyway, long story short, I am going to try to get out of my PM agreement with them…

Before I make that call tmrw or Thursday, I was hoping to get some actual recommendations from you all.

The house is in Hazel Park, so someone that manages Metro Detroit, please. Everyone on Google seems to have either only reviews from renters (not property owners), or doesn’t have reviews at all.

Thanks in advance!

[Nathan Gesner]

Quote from @Justin Thind:

Make sure you aren't charged any termination fee. They shouldn't hold you financially responsible for termination when they've failed to perform.

Try Drew Sygit with Logical Property Management.

Here's my default suggestions for vetting a PM: 

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. You can also search Google and read reviews. 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 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 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. 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, particularly if you have a lot of rentals.

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 policies are 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 that a tenant is 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!