The first thing that is important to know is the number of properties (or units) they manage. What we have discovered based on our own experience with internally building our property management capabilities and then handing over our entire portfolio to hire property managers: a well-trained employee who has proven processes and the right tools can manage 30 to 40 units – which assumes the accounting function isn’t included. Therefore, if you are trying to qualify a hire property manager but they don’t have any employees and they are managing 37 units currently and you are wanting to give then 7 more, then what quality of service do you think your portfolio will be receiving?
Do they personally own any rental property? That can be a real deal breaker for me! What we have seen is that although it might seem like it would benefit managers to have their own properties so they can relate better to what investors go through, we see this issue in a different way. We see it as our tenants and properties being in competition constantly with the manager’s properties. So if both you and the manager have a vacancy at the exact same time, how can you be sure your property will be the one being filled first? The answer is, you don’t!
One of the most critical aspects in managing both tenants and properties is getting into the properties on a regular basis. One thing you want to discuss with a prospective manager it to get a commitment from him or her about how frequently they formally inspect your properties. Managers in some cases will be quite accommodating. However, in most situations they will balk at that requirement or increase the fee they charge because of it. We aren’t very impressed with a property manager who thinks that conducting property inspections on a regular basis is something extra – instead of being part of the regular services that they provide. We would be quite wary of that kind of hire property manager.
During your discussion in hire property manager, if you find that the person is trying to finish your sentences or cutting you off constantly, you will have constant problems if you decide to hire them. You will be treated the same way whenever you have a question or issue regarding your investment. The best managers are the ones who know their clients very well and are constantly searching for ways to ensure they are happy.
There are so many different automated tenant management systems available in the marketplace that it can be quite overwhelming. It is important to be sure that you choose a property manager who uses a quality tenant/property management tool. During your interview, ask them to provide you with samples of reports from the system. If they don’t improve efficiency or use software or are hesitant to offer sample reports to you, then your experience with them might not be all that profitable.