What to look for in a property manager (renter, house, monthly fee)

[Electrician4you]

Unless you just gotta keep the house because its special favorite one of a kind willed to you through generations sit down and look at the facts.
How much "profit" are you looking at? At the end of the month/quarter what is your profit?
Are you ok with possibly seeing the house trashed.
Do you have the cash reserves for major repairs?
Do you have the reserves for the down time or if the rent in the area drops and you need to be competitive to keep it rented
There are a ton of things to think about and I'm only giving a few examples

Be realistic in your expectations.

[1stTimeLL]

Again, I appreciate people trying to help here, but I repeat, I am not interested in advice on why I should or should not rent. People much closer to my situation, including my realtor feel this is my best bet. I am not putting my circumstances out here for discussion. The decision has been made.

What I really need help with is how to evaluate the PM options.

Is anyone able/willing to answer my original questions?

[STT Resident]

Originally Posted by 1stTimeLL

Is anyone able/willing to answer my original questions?

Setting aside all the "flannel" on the thread and fully understanding that you've made a decision on the direction you want to go in, have you thought of seeking input from the area-specific state forum here? There may well be readers in your area who'd be more than happy to not only address specifics but guide you towards PMCs in your area (via a direct message through the forum) with whom they do business and can personally recommend. A LOT of people where I live used property managers for their rentals (long term and vacation) and, like everything else, there are good ones and bad ones but word quickly gets around in a local area! Good luck and hope you find the right one, as well as the right tenants!

[Electrician4you]

Finding a PMC that fulfills all your needs wants and desires is as much of a crap shoot as finding a renter who fulfills your every desire.
All you can go by is who are their clients. You can ask for a list and call for references if they allow you to do so. And I doubt most will give access to their client list. Otherwise all you have to go by is a professionally done brochure telling you how wonderful they are. It's literally a job interview. You are hiring them to protect your interest and to literally be you in your absence. There is no absolute answer to finding the right PMC . For example the first PMC I used was highly recommended. The guy they rented to was running a tire shop out of the house. When he was evicted, the house was ready to be torn down. I was overseas at the time. I ended up having to literally tear the inside to stud and start over. I only found out cause a neighbor got in touch with me and said when you get home you need to come see your place. Never mind the few months I never got the rent at the end. Never mind that they never got in contact with me at all.
I deal with PMCs all the time for commercial accounts. Plenty of bad ones out there who have bad managers. This one PMC makes you come to them to get the keys and they are about 30 minutes away from the property. And want you to bring it back. Yet instead of the manager meeting us there at the premises we charge a additional two hours on top of the service call because the guy us too lazy to come open the doors. One time he had me waiting for 1/2 hr because he was on the phone. With his gf. I tacked another hour on to that call. EVERY time the PMC makes a vendor wait they charge the owner.

[NoMoreSnowForMe]

OP, I understand that you are going to hire a PMC.

The contract you mentioned is exactly what my daughter was promised. The problem is, that $250 instantly disappeared. Then they wanted a reserve for painting, etc., to get it ready. Then that disappeared and they needed more, because of all the "emergencies" that mysteriously ate up all the painting, etc., funds.

I'd change the "unless it's $250 or under" to EVERY time something needs to be done, you are contacted and given the option of hiring someone of your own choosing. Or at least approve of the bid/cost before they do it. Nobody is stupid enough to okay a $600 emergency tree trimming job.

Also, make sure there isn't some little clause in there about supervisory fees, which my daughter discovered later. Also, look at the termination agreement. My daughter's contract said she'd have to pay a month's rent termination fee if she fired them. She threatened to sue them and they backed off of the termination agreement.

They also charged the tenant non-refundable fees my daughter knew nothing about, which are illegal in CA. My daughter was out of pocket for those fees to the tenant after firing them.

I'm telling you this, knowing that you have decided to hire a PM, so that you can get your lawyer to make sure you have a contract that doesn't allow for getting ripped off.

Perhaps, as someone else mentioned, a solo real estate professional might be a better bet. Tell them that you are planning on selling down the road, and you will list the house with them, if you're happy with their services?

That's what my daughter ended up doing. She contacted the real estate agent who sold her the house she now rents out, and talked to him about maybe just selling it. He said she'd probably do better if she could hold out and list it in the spring (her current lease wasn't up for several months yet). So, they worked out a deal where he will manage the place ans she will list with him when she sells. I'm not sure if she gives him any payment on top of that agreement or not. But, she's happier with him by far than the PMC that ripped her off.

It was too far for me to deal with, too, so once I got the tenant mellowed out over all the fiasco with the horrible PMC, and got them set up with PayPal, and negotiated repayment of their "non-refundable fees," yadda yadda - basically keeping them from suing my daughter, then I bowed out, and her realtor took over.

[bentlebee]

We own and run a brokerage and property management company and we are a franchise of one of the biggest real estate companies in the world and have a very good reputation.

The biggest issues we come across and what is getting us more business is the repair issues as someone pointed out prior.

Therefore we are not affiliated with any contractor, usually we get estimates for repairs and with some companies we get discount since we order more work at that company and they reward us with discounts which we give to our clients so they are happier.

We rarely have emergency calls since most items under the law are not considered emergency items. An A/C that breaks down is not considered an emergency issue and btw we don't pay additional for repairs during the evening and weekend at the company we mostly use.

If a company charges evening and weekend additional charges than we will wait until the next business day or we go with another company that doesn't charge it.

We have changed many companies for other companies due to their increase in prices and that is the benefit of not being affiliated and worry about being accused of over charging.

We also submit the actual invoice to every owner. Nowadays it is harder to get multiple estimates for certain items since many companies have changed their policy and they will charge money for every estimate but they will deduct that amount from a future repair.

We have different agreements with different owners. Some want to give approval for any repair while others don't want to be bothered under a certain amount.

Of course if the toilet is overflowing we have to react right away and we need to call a plumber but if the cause is due to a tenants negligence than we have to charge it to the tenants, but that has only happened a few times.

[1stTimeLL]

Thank you all! Great advice!

[Galaxie Girl]

My husband and I have a property manager for the multi-family units we own in AZ (we live in CA), and have overall been pretty satisfied with the service so far (been 2 years now). So, there are good companies out there!

That said, we know how to manage a property ourselves (since we also own units here in CA that we manage), so we were more comfortable interviewing managers than I imagine you would be, since you have no experience with it. I found a website a while back that I think was very good at spelling out what owners should ask property managers. Keep in mind that this is very detailed, and that not every manager will do everything that is spelled out here (actually, I doubt any manager would do everything spelled out here).
Hiring a Property Management Company - The Complete Guide

You should read through it and decide what aspects/features are important to you, and what you are willing to deal with yourself. For example, managers are not contractors, and will generally not oversee major work being done to a unit. They aren't general contractors, so don't expect them to act like it. But by all means, ask them lots of questions about how they handle various situations (tenant doesn't pay on time, tenant gets a dog after you said no dogs, applicant has a past eviction or bad credit, tenant leaves unit dirty, unit needs paint, etc.). You want to know that they are familiar with state and local laws for landlords, how to evict, how they screen, how they maintain their knowledge as laws change, etc.

[luvca]

If/Since you're not local to the rental I'd say for just 1 house, take a private PM who will take 5% instead of customary 10% of your rents. That would be just $90/mo if the rent is $1800.

Even better, get a small PM that will take flat $50/mo just to collect rent, deal with repairs etc.

Good luck.

[bentlebee]

Originally Posted by luvca

If/Since you're not local to the rental I'd say for just 1 house, take a private PM who will take 5% instead of customary 10% of your rents. That would be just $90/mo if the rent is $1800.

Even better, get a small PM that will take flat $50/mo just to collect rent, deal with repairs etc.

Good luck.

Great advise...we see it over here all the time, and there is a famous sentence " you get what you pay for"!

We charge 10% and you may think it is a lot, but there are easy month but also month where you have to do a lot. For example;

Tenant is paying late and you have to prepare a 3 day notice, make sure you drive there and post it and obtain proof, often calls back and forward and / or emails have to be send regarding the issue of late payment. Many tenants will come up with excuses, and a lot of BS.

When there are repairs most calls and emails about repairs are made after hours since tenants often work. Estimates or work needs to be arranged and we always if possible will make sure we have pictures and inform the owner about what is going on, arrange the work to be done and if materials are needed they will be paid upfront from my credit card so contractors can't take us for a ride for materials by buying stuff for other jobs. Than we need proof to show the owner the work is done....really do you want to do that for $50?

I guess not but sitting on the side lines or having dealt with a bad management company may have you to believe that is the way to go. I rather don't take an owner/property than discount the work and hate the amount of work for the lousy $50 that will not cover the salary of the property manager and the gas we have to spent and money for copies, etc....

But perhaps you never even thought that much about what is needed to perform the work. I can tell you that most of the properties we add are from discounted agents/managers who end up taking the owners for repairs to make some money.