How to Hire a Great Property Manager
The easiest way to hire a property manager is to call a local realty company and ask whether it manages properties. That’s convenient and fast, but it might not lead you to the management company that will do the best job for you. The bottom line is, you are looking for a company that has the strongest track record of managing rental properties.
You can also find property management firms in your local Yellow Pages (look under “Real Estate Management”), by doing an online search, or by asking for referrals from real estate agents, attorneys and other professionals.
But before signing an agreement with a manager, take these steps:
- Interview as many property management firms as you can in your area. If you tell them that you are speaking with several companies, they could be motivated to offer additional services or better financial terms.
- Ask about the services that they provide. Most property managers will try to keep your property rented, collect rents, evict non-paying tenants, supervise superintendents and contractors, and serve as your go-between in other ways.
- Ask for a list of properties that the manager currently handles. Some managers could resist and say that they need to protect the privacy of their other clients. Even in such cases, they should be willing to tell you how many properties they manage, and what those properties are like. So ask for references and call them to follow up.
- Ask to see the property manager’s license. Not all states require them. Call your state government’s department of consumer affairs and ask whether such licenses are issued to property managers in your state.
- Ask whether the manager has any professional credentials. For example, he or she could be a member of the Institute of Real Estate Management.
- Make sure the company is bonded. That means that the company carries a bond that will protect you from losses if one of its employees embezzles money from you.
- Ask about the accounting services that will be provided. Your manager should provide you with a complete statement of profits and expenses for you to use when filing your tax returns.
And here’s a sobering thought . . .
Remember that a property manager is not legally required to make sure that your property is rented every month. If a tenant leaves, your manager is not obligated to pay you for rents during the time the property is vacant. That’s one more important reason to make sure you hire a good property manager in the first place.