Hiring a property management company can save you time and money, especially if you own multiple properties, live far from your rental property or have a busy schedule. Companies can also monitor your property and protect you from problems that can impact its value and your revenue.
But finding the right company requires a careful assessment of your needs, budget, and goals as a landlord.
There are several factors to consider before choosing a property management company:
- What are your needs and do the company's services match them?
A property management company should be able to handle the entire rental process for your property – from advertising and marketing the unit to tenant screening and collecting rent once a tenant has been found.
Once a tenant has been placed, key tasks property managers handle include: preparing leases and enforcing the lease terms, inspecting the property regularly, and overseeing all repairs, landscaping, and other maintenance. A property management company should also have a sophisticated system to track rent collection, notify you of any property issues, document all financial transactions, and provide you with regular reports of income and expenses. Because the company should handle all communication with the tenants, great customer service and the ability to maintain positive relationships with tenants are critical.
If you own a DC rental property but do not live in DC, you are legally required to provide the city with the name and address of a resident agent based in D.C. Since the resident agent can be an individual or a business, you can use the services of a DC property management company, which can receive any communication on your behalf.
- What is the company's fee structure?
Ask for details about the company's fees, and what services they cover, before you sign a contract. This is an area where companies differ.
- Is there a flat percentage fee for an all-inclusive package or does the company charge different fees for separate services?
- Are there extra charges for specific services or items?
- For repairs, does the property management company add a percentage "mark-up" fee to contractor's invoices?
- How often will you be billed for the fees?
- Who will be responsible for handling your property?
Find out whether the company will designate a dedicated property manager for your property. If so, find out whether the manager is licensed and how much experience he or she has, including experience managing properties similar to yours. Find out the company's procedures for handling issues that might come up when your manager is busy or on vacation.
- How and when can you and the company communicate?
When you have a question, will the company answer quickly? The company’s availability and responsiveness to you and to tenants matters. Note their hours and learn how they respond to owners questions and how they handle urgent and emergency property issues that occur outside of those hours. Do they have 24-hour emergency service?
Some companies have sophisticated property management software that allows owners to securely view their property records and monthly reports online anytime. If the company doesn't have that, find out when and how the issue reports.
Decide how often you want your manager to contact you with updates. In addition, it is wise to set limit on how much the company can spend on repairs without your approval.
- Does the company have good references?
Request and call multiple references from the company. Has the company managed properties comparable to yours? How many additional properties does the company manage? How do they divide their time to address issues at different properties?
These questions can help you start the process of selecting a property management company for your rental property. When interviewing companies, this article includes in-depth interview questions to help you find a qualified company that matches your needs. Click here for more information about Gordon James Realty's comprehensive property management services.