Hired PM 4 years ago and more than $100,000+ later

[NA NA]

We have a 4 plex, family owned complex. 4 years ago we decided to move out of the complex. Two units were family occupied, 2, were tenant occupied. Moving open it up to make it a full tenant occupancy residential rental. As owners, as soon as we were out, we began the renovation on both units, head to toe. Together costing us 85,000$. Before any new tenants moved in, we hired our PM. Our thought was, how helpful it would be. We'll maybe in some ways but not in profits. The PM brought to our attention and suggested improvments he felt were nessesary on updating each unit, after our complete renovations were done. We had redone a brand new kitchen and included a new water line for a refrigerator cold water dispensing. He said it wasn't nessasary so he wanted that closed off. Then he wanted to redo the placement of the electrical outlet for the appliances stove, fan, above stove microwave. Saying, It was more logical and made more sense. He suggested repairing the fireplace bricks, redoing the bathroom floor, vanity, all doors. The other unit, didn't need as much done by us the first time, but he came in and said we should put a fire barrier in the top attic. Also, building a wall to close off  a small closet. All in all another 40,000$ was spent after he was hired. Then they tenant that he moved into one unit was himself. He pays market value, but never got our permission to move in . The other unit he rented to his daughter and family, they lasted 2 months and caused $5000, in damages to the brand new unit. We were appalled at that one. 3 years later over $150,000 of renos, he seems to keep coming to us with repairs after repairs. We had a major blow when last year mold was brought to our attention , that as a 20,000 remediation that had to be dealt immediately. Plus reimbursing tenant for rent and damage to property.  I feel like hiring the PM has broke us. And he's not helping us climb back up. Most recently a shower tub needed replacing, well he paid his maintance man to put a fix on it 200$ -then 1 month later the bathroom costs 4000$. Now he's come and wants a vanity and new toilet. We had meetings with him about we our business finances are in the red, not making repairs unless its a non habititable issue or saftey concern. I can't stress enough . The our business account is at its lowest ever. We have property taxes and insurance to pay. It might be old, but if it's not broken were not replacing it. We can't. Isn't it a PM responsibility to help tje owners bottom line to make a profit for the owner as well. He's not getting how broke we are . After property taxes there will be 5000$ left in our business account. We can't get out of this hole. Is he a bad PM. I have no idea how to handle this guy. We are so sad and afraid.

[Nathan Gesner]

Quote from @NA NA:

I'm sorry, but you have to accept responsibility for these decisions. The property manager has a legal responsibility to protect your interests. Instead, they are taking advantage of you and you are letting it happen.

I recommend you learn what a good PM looks like, then start your search for a new one immediately. Interview several. Look for a PM that has at least ten years in the business and hundreds of rentals under management. Scrub their PM agreement, lease agreement, etc. Explain our situation and see if they have a solution or if they just make lofty promises without a clear plan of action. You should be able to find one that can explain exactly how they will fix this, how long it will take, and what it will cost you. If they can't do that, keep looking.

Remember: cheaper doesn't mean you'll make more money.

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. Try interviewing at least three managers.

1. Ask how many units they manage and how much experience they have. Feel free to inquire about their staff qualifications if it's a larger organization.

2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, 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, a 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. Consider 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. A tenant complaining online might indicate that the property manager handled them appropriately, so be sure to ask the manager for their side of the story.

7. Look at their marketing strategy. Are they doing everything possible to expose properties to the broadest 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!