6 Tips When Choosing a Property Management Company
A landlord is only as good as their property management company. A good company will keep tenants happy, effectively screen new tenants, and will ensure that all properties under their care are in good condition.
If the company you choose does not treat your tenants or properties well, business will suffer. It's vitally important to choose a company that has a good reputation and sound business practices. The following 6 tips can help you choose a property management company that will benefit your properties.
1. Get Referrals
You probably know property owners in your area. Ask someone with good judgment which property management company they use. Find out why they like that company, what they would change about that company (if anything), and if they would refer that company to someone else. Ask multiple property owners, if you know more than one.
2. Read the Contract
An established property management company should require a contract or a written service agreement for its clients. Read the contract for every company that you're considering. Highlight any portions that you don't understand or need to be clarified. Ask questions if need be, or show the contract to your lawyer if it makes you more comfortable. Never sign a contract you don't understand.
3. Visit One or More of Their Properties
One of the best ways to ensure that a property company is taking good care of its clients is to visit some properties under their care. Note the condition of the landscaping and the building exterior. If the opportunity arises, ask tenants if they're happy.
4. Interview Multiple Companies
Meet with representatives from each company in person. Have a list of questions to ask each company to make it easier to compare candidates. Questions to ask include:
- How long have you been in business?
- How many properties do you manage? Can you tell me which properties you manage around town?
- Do you have references?
- Do you have an emergency number for tenants to call after hours?
- Does your company manage all of its own maintenance or do you subcontract certain types of work?
- How many employees does your company have?
- What methods do you use to screen tenants?
- How do you handle evictions?
While you're interviewing candidates, listen for cues that indicate they're familiar with your state's tenant laws. It's critical for any management company you hire to be familiar with your state laws, as mismanagement of your tenants could result in fines and even lawsuits.
5. Shop Around
Shop around for quotes. Read each bid closely, as not all companies will provide the same services. Keep in mind that the lowest bid may not be the best bid. Companies that dramatically undercut the competition could be cutting corners in a way that would lead to poor customer service and unhappy tenants.
6. Check Their Licensure and Certifications
Some states require property management companies to have a real estate license in order to show empty apartments. Find out the requirements in your state, then check each property management company to ensure that they have the right credentials and certifications.
Depending on the laws in your state, and what the property management company is responsible for doing, your management company may also need to have a contractor's license. Find out exactly what your state requires. When vetting the company, make sure the license is active. It's not enough to have a license number; the number should be valid and active.
Keep Up with Your Management Company After They're Hired
Once the management company is hired, it's your responsibility to ensure that they're living up to their end of the bargain. Check in on your Crow Wing County commercial property on a regular basis. Inspect the grounds, look at the landscaping, check the various systems on the property (HVAC, roofing, etc), and talk to your tenants.
Do this at least once per year to ensure that your property management company is meeting your standards and providing a good experience for your tenants. Pay attention to trends, as well. A sudden loss of multiple tenants on a single property could be an indication of a problem. Keeping up with the activity of your property management company helps protect your reputation as a landlord and property owner.