How Do I Choose the Best Property Management Firm in My Local Area?
Are you having trouble managing everything with your rentals? That’s not surprising. Many rental property owners underestimate the amount of work it takes to manage homes.
That’s why so many people turn to property management companies to get help. Luckily, you have more than 300,000 to choose from in the United States if you’re looking for help.
Even though countless property management companies are available to help you manage your properties, they all don’t provide excellent service. Keep reading to learn how to find a great property management firm that will take care of your tenants.
Find a Firm With Specialized Experience
There are a lot of little details that go into property management, and those details may change based on the property you own. With the different types of real estate out there, you can’t afford to work with someone without the right experience.
Take an apartment building, for instance. You’re dealing with more complex systems. A management company that has only managed single-family homes won’t have the resources or knowledge to handle an apartment building.
Before you sign a contract with a property management company, make sure they have experience managing the type of rentals you have. Check the website of the management firms to see what expertise they advertise. Don’t continue the interview process and waste time unless you know that a company can meet your needs.
Look for the Right Management Licenses
Unfortunately, licenses aren’t required for management companies in every location. While some areas with tighter regulations require companies to prove management experience, you won’t be lucky elsewhere.
However, that doesn’t mean there aren’t ways to verify a company’s skill. There are many real estate management organizations that property management companies can join.
The best property management company options in your area will have membership in those organizations. Here are a few to consider:
- National Association of Residential Property Managers
- Master Property Manager
- Residential Management Professional
- Preferred Residential Management Company
Any company that wants to prove its expertise will be part of an organization to back up its claims.
Examine the Number of Services
Not all property management companies offer the same services. While some full-service companies provide every service you can imagine to help manage your properties, some companies don’t operate that way.
If you don’t think you need full-service property management yet, it pays to learn what services you can get. Here are some to consider:
- Maintenance issues
- Tenant screening
- Rent collection
- Legal help
Start small with limited services if you don’t want to completely commit to a company yet. You can always scale up your service level when necessary to free up more time for yourself.
Visit this link to see more services that a property management company will offer.
Ask to See Performance Metrics
Knowing how a property management company performs before hiring them is vital to hiring a great company. Unfortunately, you won’t always see this data ahead of time if you don’t ask.
A property management company should collect metrics about its performance to optimize it. Here are some important metrics to consider before hiring a management company:
- Average occupancy length
- Vacancy rate
- Percentage of late payments
- Eviction rate
There are other metrics to consider, so consider those that matter to you. Ideally, you’ll collect information about the service you plan to use with a management company.
Get the Real Pricing
The price you pay a management company isn’t always obvious. You’ll pay either a monthly fee or a percentage of your rent payments in many cases. However, that may not be the only charges you see.
Many companies charge service fees for specific tasks. Things like marketing, tenant requests, move-outs, and other regular tasks may have an extra fee.
You also have to watch for markup on items needed for home repairs. Take a light bulb change, for instance. A property management company may add 10% of the replacement cost to make more money.
You need to know all of this before choosing your provider to understand how much you’ll actually pay for the service.
Verify Insurance Coverage
The last thing you want to happen is for an accident to occur on your property without insurance coverage. If you suffer from property damage or someone gets injured, you may end up on the hook.
At a bare minimum, your management company should have general liability insurance. If you want to go further, check for property-casualty insurance and errors and omissions coverage.
You can also get insurance yourself for added protection. Take whatever steps you can to protect yourself in the worst-case scenario.
Get Reviews From Previous Clients
One step you can’t skip when looking for a management company is learning from people who have been there before. Many property managers have online websites and listings on local websites. Previous customers use those websites to post reviews for companies they work with.
Check these reviews before you decide to work with a company. You won’t learn everything about a management company by only speaking with its representative. It’s hard to find the bad points of a company going this route.
Look for any common issues that make a property management company an unattractive option. Stick with the ones that have constant good reviews.
Reach Out to a Property Management Firm Today
You can’t afford to waste your day taking care of tenant needs when you own rental properties. Unfortunately, that’s what will happen when you invest in portfolio diversification and start taking on more properties. Reach out to a property management firm to see how its services can save you time and meet your tenants’ needs.
Do you want to learn more tips that will help you improve your investment portfolio? Check out the blog to learn more investing tips.