Quote from @Abdul Azeez:
Hello folks - after severe mismanagement of my property by my PM company they are now telling me that I have until this week to find a different PM company. Most of the issues with the property have been due to the mismanagement of the PM company. This timeline is too short and there is a tenant in the property. What is my recourse at this time?
The management agreement says:
The term of this Agreement shall be for an initial period of Twelve Months (the initial term), Commencing the 29th day of March 2017 through the 29th day of March 2018 shall be automatically renewed from year to year unless terminated as provided in section 10 herein.
And termination section says:
TERMINATION
1. This agreement may be terminated by either the Owner or Agent, with or without cause, at
the end of the initial term or at the end of any following term year upon giving 30 days
written notice prior to the end of said term.
2. Agent may terminate management immediately if Owner carries a balance over 30 days.
3. Agent may terminate management immediately with Owner if Owner refuses to do
necessary maintenance that could conflict with Memphis City Code Enforcement (i.e., no
heat, roof leaks, no hot water, etc.) and/or Reedy and Company’s quality standards.
Based on reading the above it looks like a 30 day written notice has to be provided isnt it?
The agreement clearly states they must give you 30 days notice. But you also state there has been "severe mismanagement" by the PM company, so they're unlikely to abide by any of their rules. I agree with Scott that you need to find a new PM, immediately.
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. 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!
