All Forum Posts by: Matthijs Pol

@Matthijs Pol

In our experience, the #1 mistake owners make when selecting a Property Management Company (PMC) is ASSUMING instead of CONFIRMING.

It's often a case of not doing enough research, as they don't know what they don't know!

Owners mistakenly ASSUME all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY, so price is the only differentiator.

So, the first question they usually ask a PMC is about fees - instead of asking about services and HOW those services are executed.

EXAMPLE: PMC states they will handle tenant screening – what does that specifically mean? What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.? You’d be shocked by how little actual screening many PMC’s do!

This also leads owners to ASSUME simpler is better when it comes to management contracts.

The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it!

We have a 14-page management contract that we've added our real experiences to over the years, with the intent of protecting both us AND the landlord. Beyond the Monthly Management, Placement & Maintenance fees, all other fees in our contract are IF EVENT -> THEN fees.

We don’t know any PMCs to recommend in the area mentioned, but since selecting the wrong PMC is usually more harmful than selecting a bad tenant, you might want to read our series about “How to Screen a PMC Better than a Tenant”:

https://www.biggerpockets.com/member-blogs/3094/91877-how-to-screen-a-pmc-better-than-a-tenant-part-1-services-and-processes

We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

P.S. If you just hire the cheapest or first PMC you speak with and it turns into a bad experience, please don’t assume ALL PMC’s are bad and start trashing PMC’s in general. Take ownership of your mistake and learn to do the proper due diligence recommended above😊

In my opinion, Chattanooga is the safer play! Folks are renting quite a bit in Chattanooga, and while Kevin is right about the lower prices in Memphis, Chattanooga offers a quickly expanding market with huge potential. Homes are appreciating nicely in the Chatt. area, and rental rates are steady for the most part! Make sure to do your own due diligence, but Chattanooga is a growing market waiting for new investors to break into it!

You will find far better cash flow opportunities in Memphis with the low prices, but the area experiences very little appreciation. It'll be a little harder to find good cash flow deals in Chattanooga, but it's a growing area and homes are appreciating well there. So it depends on what your goals are. 

@Matthijs Pol Welcome to BP and the exciting world of real estate. There are a ton of resources on BP where you can pick up tips, advice, etc and one can accumulate so much info that one forgets to pull the trigger. Do you own a principal residence? Living in your own property that has a rental suite can be a good way to get experience as a landlord and property owner. Best wishes.