Top 12 Interview Questions for your STR

You've finally done it - purchased your ideal vacation spot to retire in one day - and now you need to hire a company to manage it. Where do you start and what do you look for?

I’ve researched property management companies extensively in recent months and signed over 80 homes for one of the largest short term rental companies in my market after investing in my own condo in 2017. Their programs are all VERY similar as the industry evolves. What it boils down to is trust in the person you are hiring firsthand to manage your property. Look for a company that has a strong local presence in the community and a new & growing or mid-sized portfolio. Avoid the largest companies where you are just a number. Their operations are compromised no matter what their expertly written literature says. Find out how long their managers have been in those job roles. Interview current customers if you can.   Also avoid the companies who don't have a website, processes and infrastructure to handle the back end critical issues that can affect you at tax and statement time. I've heard first hand from owners who hired companies committing fraud and did not even pay owners rental proceeds at all.  If they manage under 50 properties they don't have the income to support their growth.  If they are the fastest growing management company around, run like the wind. Find a company in the middle and a company that operates locally.

When you interview property management companies these are my top pick questions for consideration:

1. ) Can I see a sample statement?

Is this the level of detail you are looking for? Most are not very specific unless you ask for more details.   

  2.) Who will be my local point of contact? How long have they been in their current position?

Ask to meet that person; if they haven’t been there long - be wary!

  3.) What is your involvement in the local community?

If they are involved locally, they have a vested interest in keeping their reputation in tact. Are they Chamber members? Do they support any local events?

  4.) How would you handle ______??

Give a couple of common scenarios such as guest broke a handle, stove breaks down, or power goes out. Do they have reasonable answers or evade the question? How many maintenance people are on staff?

  5.) What other fees than your commission fee do you charge?

20 - 25% is normal in the Panama City Beach, Fl. market inclusive of booking fees, credit card fees, etc. Most companies will provide door locks as well. It’s the other fees you need to know about. What is their threshold for calling you? Do you want to be called every time a door knob needs to be replaced or when a washer needs replacing?

  6.) What are the property taxes for my county and who handles that?

Total taxes are 12.5% in PCB; make sure they have an accounting team or tax team to pay these.

  7.) Is there a contract?

I do not advise signing a length of term contract. Make sure you know the exit strategy even if everything else sounds perfect. What would you be responsible for if existing reservations being cancelled? How much notice should you give?

  8.) How do I cancel if I’m not satisfied?

You will typically be responsible for the booked reservations even if you cancel. On-site PM companies will generally move those to another room since they have more similar units and operate more like a hotel. Especially if you have a unique property, ask what would happen if the booking is moved or cancelled.

  9.) How do you handle linens?

Ask what the sheet thread count is. If you are in a higher end market it needs to be higher to meet guest expectations. Do they use your washer / dryer or launder off-site? If they launder off-site, how will the comforters and extra bedding get cleaned and returned?

  10.) What about door locks?

Guests don’t like to keep up with keys on vacation. While Schlage / Kwiksets have easy to use digital locks with short codes, those codes are not changed regularly by PM staff so can lead to security issues if the property is not checked quickly after each guest. Kabba locks and other higher tech systems might cost more upfront yet can save you thousands over time.

  11.) How many properties does each property manager handle?

This is probably the most telling sign of their ability to handle your property so really drill down on this one. If they are “responsible for 50 properties” yet they have 300 properties in market and only 3 managers - do that math! I’ve seen companies try to grow too fast and this gets out of hand. If they don’t have a dedicated property manager at all, but rely solely on third party cleaners - do you think those cleaners will inspect to a guest satisfaction level you want?

  12.) How would I book my own reservation; are there any restrictions or fees in doing that?

I was floored to learn some PM companies actually charge their owners to stay in their own home or restrict when they can use the property. Ideally they will have an easy booking system to make your own reservations and should be flexible with how you use your own investment.

If you find a property manager who can walk you through these questions confidently, they know the industry and likely have the experience level to manage your property.  Express the importance of communication and make sure they respond to emails, keep appointment schedules, and answer their phone.  If they do this, sign up and follow up!  You'll be well on your way to turning that vacation home into the cash flow investment you intended it to be!