How to Hire a Property Manager
In 2016 I purchased My First Property with the help of a turnkey company. They assisted in acquisition, renovation, and pushed me to work with their preferred property management company. Boy, was I stupid in blindly working with their property manager without vetting them. And YES, it ended up biting me in the ass!
My property became unexpectedly vacant without any notice and there was a squatter in my garage. How do you guarantee no return on your investment? Own a vacant property that’s managed poorly.
So, I got right to work in finding a NEW property manager. If you’re looking for a property manager, don’t take this process lightly. Here’s my step-by-step guide:
A. Get Property Management Company Leads
There are multiple ways to figure out who the best property managers in town are. Here are three resources to target your next property manager:
B. Scour their Websites
To better vet your property management company leads, take a look at their website. Is it well maintained? Are they transparent with their fee structure? Is it easy for you AND tenants to contact them? Can tenants pay online? Is it a mom and pop shop? Or a massive national company?
C. Interview your Top Leads
Now, it’s time to give them a call or meet them in person! DO NOT SKIP THIS STEP! You must truly vet and interview each company. Your property manager essentially runs your real estate business day-to-day, so understand the importance, and make the right hire! Here are a number of questions that helped me select my new property manager:
1. What are the various services that you offer to your clients?
Know exactly how this company plans to market, inspect, lease, manage, maintain, and maybe even sell your property.
2. How many rental units do you manage?
Too few units and they could be inexperienced or losing clients. Too many, and you might get lost in the shuffle. I think 200-600 units is the sweet spot.
3. How do you determine rent amount?
Rent = cash flow. Not sure much needs to be said here, but determining the appropriate rent amount is crucial to your investment. Your PM needs to be an expert in the rental market.
4. Are you currently an active real estate investor in your market?
Is the property manager an investor who understands the mentality of a landlord? If so, that’s an added bonus in my book. And honestly, probably should be a requirement.
5. Under what conditions can I cancel my management contract?
Understand exactly how you can get out of a contract if needed.
6. What are the management fees and/or pricing options when the property is being rented?
Pretty self-explanatory. You MUST understand all costs and expenses when investing in real estate.
7. Are there fees when the property has no tenants?
Some property management companies charge a monthly fee even if the place is VACANT. I only work with property managers that get their fee on COLLECTED RENT.
8. What miscellaneous fees could I be charged for the management of my property?
Again, pretty self-explanatory. You MUST understand all costs and expenses when investing in real estate.
9. Do I have to sell my property with you if I want to list it?
Some property managers will require you to sell your property with them. Be clear on this agreement before hiring them.
10. Do you offer direct deposit for your owners?
This should be a 100% yes.
11. How do you collect rent from tenants?
Understand how rent is collected. If your property manager isn’t having tenants pay online that will slow down the speed in which you get paid and makes it easier for tenants to miss payment. Also, from a tenant’s perspective, an easy way to make a rent payment is just a major benefit.
12. Do you conduct property inspections? And, if you do, what charge is associated with
Routine inspections are key in owning rental property. You’ll want to catch issues before they spiral out of control. You should be saving some of your cash flow for repairs every month so it's encouraged you actually use some of it responsibly for long-term sustainability. Don't wait for your gutters to fall off before putting money into them...clean them once every 6 months!
13. Do you offer eviction warranty (also called a “screening guarantee”)?
Some companies offer this warranty that will save you in an eviction process. But, needing this is completely up to what you’re comfortable with.
14. What steps do you take to market properties?
Your property manager should be advertising through multiple channels.
15. How long are your properties typically vacant?
2-4 weeks should be the average time needed to get your property rented. Any longer and your rent may be too high or your property manager is not effectively marketing it.
16. What are your income and screening requirements for applicants?
There should be a standard policy on tenant income requirements.
17. What control do I have over the tenant lease agreement?
Your property manager should allow you some input in the lease agreement. A big one for me is regarding pets: I typically have a no pet policy.
18. Do you mark-up maintenance and repairs?
Understand if your property management company makes a profit anytime maintenance is performed. This will factor into your overall return on investment.
19. How often will I get updates on my portfolio?
You should be able to get updates on your portfolio as often as you want. After all, it is your property.
PRINTABLE VERSION OF THESE QUESTIONS
D. Make a Decision and Hire
Now that you’ve found property manager leads, vetted them, and interviewed them, it’s time to make a decision. Weigh their fees, experience, number of properties, customer service, and your gut. Who do you want to work with? And most importantly, who do you trust?
If you have multiple properties, hire multiple property managers to oversee portions of your portfolio. For example: I have two properties and two different property managers.
This limits risk as you’re not relying on one PM to manage your whole portfolio. But, the greatest benefit is you can go through a little “test run” with each PM and see how they are different. This will help you determine the best PM for your long-term goals.
Hopefully this helps you in selecting the best Property Manager out there! If you have any questions, leave a comment below, shoot me an email, or send me a tweet!
4/15/2018 08:50:58 am
Really great tips! I've never had to hire a property manager so I most definitely would have missed some of these things! Number 7 and 9 were really eye opening for me. Keep up the good work :)
4/15/2018 05:17:41 pm
Thanks Nick!! If you ever end up needing to hire a PM be sure to let me know if you have any questions!
6/18/2018 04:54:41 pm
Thanks for the education.
6/18/2018 09:48:17 pm
8/15/2018 12:20:33 pm
My father has been thinking of renting out some homes, but isn't sure what to look for in a property manager. I love how you mentioned to looks at their websites, as it can help you see how transparent they are. Another great tip I've heard is to read their reviews across several sites, as it will give you the most in-depth knowledge. These tips will totally help my dad out, so thank for sharing them.
8/16/2018 11:22:01 pm
What's up Taylor?!?!
8/17/2018 07:56:21 am
I have a property that is a real pain to take care of sometimes, since it's just so time consuming. I can see why having a professional property manager would be beneficial! Maybe I should look for one that is nearby to help me out.
8/17/2018 09:46:47 am
9/13/2018 12:24:36 am
Thanks for the information you have provided in your blog as it proved to be very helpful for me in start writing my own blogs you have provided in this blog as it proved to be very helpful to me.
9/13/2018 09:56:19 am
You're welcome and thanks for reading!
4/7/2019 02:27:55 pm
4/1/2019 03:06:12 am
A property chief is a necessity for me. Be that as it may, I can perceive any reason why a few financial specialists may not need one since they don't need the additional cost. These tips will thoroughly help for all real estate businessman out, so thank for sharing them.
4/7/2019 02:29:40 pm
Hey Scott! I've never heard anyone call a property manager a Property Chief. But, I LIKE IT!
4/11/2019 10:04:12 pm
You made a good point when you said that you can ask a property manager about their plans in marketing and maintaining your property. My husband and I are interested in having one of our properties rented in the future to have other sources of income. We want to make sure that it will be easy for us to find tenants who are capable to pay their rent on time. Since our property is located in a different state, we'll do all your tips on choosing a property manager.
4/12/2019 11:17:00 pm
4/24/2019 07:22:31 am
My brother is thinking about buying a property to rent out, but there are a few areas, like marketing, that he's not sure about. I liked how you brought up that property managers advertise through multiple different channels. I think that this is something that my brother would really like to hear about and would make him feel more confidant looking into this avenue to get everything up and running well.
4/25/2019 10:57:54 am
Yup, marketing your units is a HUGE factor. Your property manager must know the best techniques to get your listing in front of eye balls and potential tenants!
5/22/2019 03:03:52 am
Hiring a property manager is not an easy task. One should be very careful in this task. The blog is throwing light on some very important points. Thanks for sharing the blog. To get your vacation rental or any other property managed well, you should contact a skilled property managers for satisfactory results.
5/29/2019 12:23:07 pm
I wanted to thank you for the advice for finding a good property manager. I'm glad you mentioned that you should check out their website to see if they are transparent. This sounds important especially so you know you can have important discussions with them.
6/2/2019 04:29:08 pm
Hey Taylor! Thanks for reading! I'm glad you've found this post valuable. Let me know if you have any questions!
6/11/2019 04:40:42 pm
It makes sense that you would want to look into getting a rental property management services. Makings rue that you have the property rented property is a big deal. My sister might like knowing this as she looks for a rental property management service.
6/12/2019 11:52:50 am
Hey Camille! Thanks for the comment! And thanks for sharing it with your sister!
6/12/2019 10:26:37 am
That's a good idea to get a manager that would advertise your property through several different channels. I would think that would help to show it off to a lot of different people instead of showing it a lot to the same people. I'll have to make sure that I get a manager that would do that if I decide to get a property to rent out.
6/12/2019 11:54:18 am
Yup! Once your property is on the market you need to get it in front of as my qualified people as possible! Get it rented ASAP!
6/18/2019 12:38:46 pm
I found it interesting how you mentioned how property managers with a lot of experience show that they are trustworthy. My wife and I are in the process of retiring and we want to make sure we start investing in properties to earn a passive income. I will keep this in mind as we search for a property manager that has a lot of experience!
6/23/2019 12:03:17 am
Congrats on the soon-to-be retirement! Let me know if you ever have any questions!
6/28/2019 08:21:14 am
Thanks for the tip to ask how they determine the amount for rent. My husband and I need to find a good property management service to use. You helped me feel prepared interview potential property mangers.
7/9/2019 10:23:54 pm
Thanks for the comment Daphne and I'm glad this post has been helpful!
7/5/2019 08:18:24 am
I have some residential properties that I need to take care of. It makes sense that getting a property manager would be beneficial! I'll be sure to find one that has experience with this kind of thing. That way, I can ensure that they take good care of it.
7/9/2019 10:24:52 pm
Property management is A MUST if you plan to keep scaling your portfolio!
7/12/2019 12:27:36 pm
Amazing story Tyler. I'm trying to do the things you've done. This is very helpful
7/13/2019 03:58:06 pm
Thanks for the comment Ben! Best of luck to you!
7/18/2019 12:16:26 pm
It's good to know that you should hire multiple property managers to oversee multiple properties. I've been wondering if I needed to hire another property manager for a property I recently purchased. I'll be sure to look for another property manager.
7/22/2019 12:32:47 pm
Hey Jackson - yeah, I definitely think it's good to consider hiring multiple managers to better vet them and see how they operate and how you work together. I won't say it's required, but it's been helpful to me!
7/29/2019 10:18:31 am
It's good to know that you should hire multiple property managers for multiple properties. My wife and I are wondering how many property managers we should hire for our 3 properties. I'll be sure to let her know that we need to hire 3 property managers.
8/6/2019 10:19:48 am
Hey Jackson - I'll start off by saying, you don't HAVE to hire multiple manager. But, personally, it's been a great way to further vet the people I work with especially being an out of state landlord.
8/6/2019 10:17:58 am
THANKS FOR READING UNI!
8/7/2019 10:37:29 am
It was unexpected when some of my tenants were complaining about their rental property. I think I'll scour the web to find a property management company that can help me make them happier. Thanks for the tip that I should interview my top leads so that I'll know how they'll work with me as their client.
8/29/2019 11:35:28 am
Hi Angela - great! And definitely interview multiple potential managers. You are relying on them to be a big part of your investing team. Hire wisely!
8/22/2019 03:12:28 pm
I thought it was interesting when you mentioned that when hiring a property management company, it is important to check their websites to see if their fee structure is transparent. I'm not too familiar with home property management works, but I would assume that property owners will hire managers when they are too far to do the things themselves. Hiring a reliable management company would probably be very important.
8/29/2019 11:37:48 am
Hi Dennis - yes, property management is almost needed if you're investing from afar. It's also not a bad idea to think about hiring a property manager EVEN if you're local...because if you plan to scale your investment portfolio you will need to focus on other parts of your business instead and allocate your time outside of property management responsibilities.
8/29/2019 11:39:04 am
Awesome Matt! Looking forward to seeing you as part of the Jump In community!
9/3/2019 10:46:59 am
I've been having a hard time taking care of my rental properties. It makes sense that getting a property manager would be beneficial! I'll be sure to find one that has experience with this kind of thing. That way, I can ensure that it gets taken care of.
9/3/2019 10:58:45 pm
Hey Braden - it's great that you've identified and recognize that managing your properties is causing some trouble. I highly recommend looking into hiring someone to take care of all the work you don't want to deal with!
10/8/2019 05:10:13 pm
I like how you mentioned that your property manager should be an expert in the rental market. My wife and I are looking to hire a new property manager. I'll be sure to look for one who has a lot of experience in the rental market.
10/18/2019 12:13:55 pm
Glad you found this post valuable!
11/12/2019 04:06:45 pm
It's good to learn that 200 to 600 units is the sweet spot when being a property manager. My wife is wanting to pursue a new career and she was wondering how to learn how to become a property manager. I'll be sure to tell her that she'll want to manage around 400 units if she wants to be a property manager.
12/2/2019 12:42:57 pm
It made sense when you said that charging the proper rent amount is crucial to our investment, which is why we need to ask potential property managers about how it's determined. My coworker told me that it's a good time to buy property, so my husband and I are thinking about investing in some rental apartments within the next couple of months. We want to use a property management company to save time, so the suggested questions you shared here will be really helpful!
1/21/2020 11:24:40 am
Glad this post was helpful Eileen!
1/17/2020 04:32:13 am
I've been having a hard time when it comes to seeking payment from my tenants. Therefore, I would like to hire a property management service that can help me when it comes to managing my condo units. Than you for this; I'll make sure to seek help from my most trusted agent and I'll try my best to post questions on forums.
1/21/2020 11:25:46 am
Rachel - yes, property management is a life saver when it comes to the day-to-day operations of owning property. Like collecting rent!
2/19/2020 10:37:20 pm
I've been too busy with my other business, that I barely have the time to manage my apartment building. That's why I'm currently looking for a property management service that could help me out. I'll make sure to ask the prospective manager about the appropriate rent amount of my units.
3/3/2020 03:03:14 pm
It's good to learn that you should only work with property managers that get their fee on collected rent. My wife and I are wanting to get more properties under our name and we were wondering what we should look for in a property manager. I'll be sure to look hire one that collects their monthly fees on rent.
3/25/2020 04:01:26 pm
Exactly Rick! Get a PM that only collects their fee on collected rent :)
6/22/2020 12:39:52 pm
It's great to learn that you should ask your agent about potential property managers you could hire. My wife and I are wanting to invest in more rental properties and we were wondering how we could find a good property manager for us. I'll be sure to tell her that we should ask our agent if they know of any property managers.
7/2/2020 03:28:25 am
All the things about how to choose your next property manager are discussed over here. This article mentions and acts as such a moving trigger. It is an article worth applauding for based on its content. I am sure many people will come to read this in future.
7/13/2020 11:22:07 am
I liked how you mentioned that you should look at a property management's website before hiring them. My wife and I are wanting to buy more properties and we were wondering how we could decide on a management company for us. I'll be sure to look for a management company that has a good looking website.
9/22/2020 04:38:16 am
I'm glad I came across your article on how to select a property management company. My sister went on a vacation a couple of days ago, and she told me that she bought vacation rentals. Because of that, she asked for my help on finding one. Good thing I've read your post, which is why I'll take your advice to check their website and if it is well-maintained and of the company is transparent with their fee structure.
9/29/2020 09:03:06 am
It's good to know that some property managers require us to use their services if we choose to sell. I want to save time by using a property management service to find tenants and collect rent for the condo I purchased. Thanks for teaching me what questions to ask when I start the process of reaching out to different property managers soon!
12/8/2020 10:47:52 am
It's great to learn that it should take 2 to 4 weeks for you to get rent a property. My wife and I are wanting to move into an apartment and we were wondering how long it should take property management to move us into an apartment. I'll be sure to tell her that we should expect it to take a couple of weeks for property management to help us move in.
1/28/2021 10:14:17 am
It's good to learn that you should look at the website of a property manager before you hire them. My wife and I are wanting to invest in more properties and we were wondering who we should hire to manage our investments. I'll be sure to tell her that we should find a property manager in the area that has a great website.
2/26/2021 12:17:43 pm
I agree that having a lot of long vacancies would be a bad sign. I like the idea of getting some open that would be able to vill any open spots as soon as possible. Hopefully, that would maximize my investment.
2/26/2021 12:22:20 pm
My parents want to get a vacation home in Florida that they can spend a few weeks or months at every year and then rent out to other vacationers for the rest of the year. Since they don't live in the year, it would probably be best for them to hire a property rental management service that can take care of keeping it clean and ready for anyone who stays there. They could really use your advice to check the website of potential management companies to make sure they're easy to contact and offer online payment and other helpful services.
3/1/2021 01:57:07 am
Wonderful information, thanks a lot for sharing kind of content with us. Your blog gives the best and the most interesting information on how to choose your next property manager. I wonder if we can gather such practical information about it, a great post definitely to come across.
4/26/2021 01:40:41 pm
It's good to learn that you should see how many rental units a property manager manages before hiring them. My wife and I are wanting to get a vacation rental and we were wondering who we should hire to manage the property. I'll be sure to tell her that we should look for a property manager that manages a lot of properties.
5/4/2021 11:42:57 am
I liked how you mentioned that you should ask your real estate agent about which property manager you should hire. My brother is wanting to expand his real estate business and he was wondering how he could hire a reliable property manager. I'll tell him that he should ask his real estate agent about which property manager he should hire.
5/23/2021 08:50:51 pm
You made a good point when you shared that it is great to work with a reliable property manager who is able to conduct routine maintenance regularly. My father just mentioned the other day that he is planning to get some properties where he can rent them out for passive income. I will suggest to him working with a reliable property manager who can take care of the houses.
7/30/2021 11:52:38 am
Thanks for all of your suggestions for choosing a property manager. I like how you recommend looking at their websites before you hire them. I think it would also be smart to read reviews on them.
9/10/2021 06:00:17 am
One more incredible approach to discover investment property the board organizations who offer extraordinary types of assistance is to join a nearby land affiliation. You'll discover there are a lot of different property managers who have effectively gone through similar encounters. They've effectively discovered which rental administration organizations recruit extraordinary representatives who are dependable. Furthermore, you'll discover different property managers can assist with addressing questions you might have.
12/2/2021 09:39:32 pm
The content and tips are on point that every investor can follow through it. Thanks for sharing.
12/15/2021 10:50:33 am
Thanks for the advice to look at a property management company's website first. That could give me an idea of who they are. I would want the website to be easy to navigate for all tenants.
2/24/2022 07:45:48 am
Thank you for explaining that it's important to not skip calling or meeting your top leads in person. My brother was telling me on Monday that he's thinking about hiring someone to help him with the properties that he's renting out. I'll be sure to mention to him that interviewing his potential property managers will help him to choose the perfect person for the job.
You made a good point when you said that is vital to understand all the expenses and costs that a property management company will charge you. I will share this with my best friend who is planning to convert her property into an apartment building. She mentioned the other day over a 10-minute phone call that she wanted to ensure that rental property management could be hired by her to easily manage the tenants and the building itself.
7/15/2022 08:01:01 am
Thank you for your suggestion to ask if they do property inspections. I've been trying to gather a list to help my brother with finding a good property manager. He is thinking about renting out some of his properties so I'm sure this will help him out.
7/18/2022 09:22:16 am
Thanks for mentioning that some property managers will still charge a monthly fee even if the property is vacant. I'm thinking about hiring a property manager to come and take over my rental properties. I'd like to hire one that gets their fee on collected rent only.
7/26/2022 02:04:46 pm
I love that you described how to find a property manager and the importance of checking their online presence first. My parents want to rent their vacation homes this year, and I don't think they have a lot of free time to deal with all the process, so I'll call them and suggest they hire a professional for the job. Thank you for your intake on hiring a property manager that has a well-maintained webpage.
It's interesting to know that some association management companies will offer a warranty that can save you from the eviction process. I can imagine hiring such services for your properties to give you peace of mind even if you are in another city or state. Their expertise would definitely be worth it if it means that they will be able to find tenants that are good payers.
8/2/2022 11:52:35 pm
I like that you pointed out that you have to learn how the property manager services you are hiring are going to maintain, manage, and even sell your property for you. I think this is a good idea for a newbie in this industry, so they can ensure that the tenants they will get will have a good experience. Doing so will leave them with a good impression which would be useful for references in the future.
9/6/2022 10:18:17 am
Thank you for your suggestion to ask them about their marketing techniques. I've been wondering what to ask now that we plan to list some of our properties to rent. I'll be sure to add this question to our list to hopefully help us make our decision.
1/12/2023 12:46:24 pm
I like how you said to check their website. My husband and I want to look into hiring a property manager that can help us with renting out one of the vacation homes that we don't use as much anymore, so I wanted to make sure we knew how to hire a good one. We'll keep these tips in mind as we search for a property manager.
3/6/2023 10:34:44 pm
It caught my attention when you said real estate agents should, at least, have a couple of property managers to recommend. That's a great idea! I'll ask my friend to seek suggestions from the realtor because she's usually involved in commercial property transactions. She might know someone who'd be a good fit in apartment management.
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