What To Look For In A Property Manager
A property manager can almost literally make or break your investment property. A good property management company can reduce vacancy and increase your tenant’s satisfaction. A bad property manager will cost you money make an already complicated situation even worse. But how do you find the right one for your investment?
How to Find the Right Property Manager
When you begin your search for a property manager, each company (or individual) will likely bombard you with facts, figures, and testimonials about their work as a way to present their work in a good light. Don’t get us wrong, many property managers are very good at what they do. However, take a step back from the sales pitch and focus on the factors that differentiate a good property manager from a bad one:
- Knowledge of the Industry
- Portfolio Size
- Communication
- Fee Structure
- Technology
If you ask the right questions and focus on what’s most important, it’s easier to tune out the sales pitch and determine the best property manager for your investment.
#1 Knowledge of the Industry
Experience is important for property manager to be successful. However, the type of experience your potential manager has matters as well. Some management companies only work with specific types of rentals – like single family homes, commercial property, and multi-family units. You want to find the property manager that specializes in your asset.
Ask these questions of a potential property manager to understand more about the assets they manage:
- What types of properties do you manage?
- Do represent a specific class of property?
- Do you have a rent cut off? (A lot of professional management companies will not manage homes below certain rent amounts.)
- How long have you been managing properties?
Don’t assume that “property management experience” means a company is right for your investment. Ask additional questions to ensure they have the right type of experience for your needs.
#2 Portfolio Size
Ideally, you want a property manager that’s large enough to have the best resources, but not so large that your investment could easily get lost in the shuffle. I recommend finding a property management company with a maximum of 250 properties per manager.
#3 Communication
Communication is the key to any successful business relationship. When it comes to property management, be sure you choose someone you can openly communicate with you throughout the process. The best management companies will work as your partner, to maximize your investment.
In the beginning of the relationship, it’s important that you clearly communicate your expectations as an owner. As time passes, make sure that your line of communication remains open, no matter the situation. I recommend that a good property manager should be able to respond within 24 hours.
#4 Fee Structure
The fees of a property management company should be easy to understand. A good company will be clear and concise, and you should never feel like they are trying to nickel and dime you. You are a partner, not just another fee generating item in their portfolio. If their goals are in line with your goals, the relationship should result in something that is mutually beneficial.
#5 Technology
There are a lot of software programs, systems, and apps available to help property managers. Make sure that your property management company uses some of them.
The benefits of embracing property management technology include:
- Instant access to information for investors and tenants
- Easy for tenants to pay rent
- Easy for tenants to make maintenance requests
- Easy for owners to track their investment
Property management technology benefits you, the owner, the property manager, and the tenants. Make sure that your property manager is taking advantage of the best technology available.
Find the Right Property Manager for You
A good property manager can help you get the most out of your investment property. I recommend that you should interview at least three different property management companies before making a decision. Download the American Real Estate Investors free checklist for successful property management to make the most out of each interview.
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