Choosing a Property Management Company can be Hard…but it Doesn’t have to be!
You’ve inherited a property – maybe a small, 3-unit multifamily rental property. Maybe it’s in the next city over, or even out of state. You don’t really know the first thing about being a landlord, let alone the repairs, maintenance, selling, leasing, and paperwork required, and you know nothing about the property management companies where your property is located. You don’t even know what to look for in a property management company. You just want to focus on your business or retirement and collect the rent checks.
Choosing a good, reputable property management company can make the difference of sitting back and collecting the checks, and letting your property go to ruin. A bad property management company can even cause lawsuits from your tenants.
But fear not! We here at Castroller have done the research on what to look for in a property management company for you, the new landlord.
In-House Maintenance Team
A property management company that uses contracted maintenance can spell disaster in every aspect of property management. It can pass higher costs to you, the landlord; it can mean longer repair times on high-priority fixes; it can cause tenants to withhold rent; it can spell lawsuits from issues such as slip-and-falls; and it can cause higher turnover times, which we’ll get to later.
Say you have a rental property in a cold area like Buffalo, NY, where the temperatures are below freezing for much of the year. A radiator pipe freezes or bursts at night on the weekend, and your tenant is without heat. While a property manager attempts to get ahold of a repairman or plumber, waits for an appointment time, and eventually the plumber comes the next day, more damage can be done to the rest of the property. That tenant, who has children, has also gone without heat for 24 hours in below-freezing temperatures. This, according to Standard Property Management, can spell disaster for you, the landlord, in all kinds of ways.
A good property management company stays on top of their properties and their tenants’ complaints. However, things happen. Going back to that Buffalo, NY example we talked about, say there is a slip and fall on your property, and a subsequent lawsuit. A good property manager will protect you from this with good insurance and knowledge of the law. A bad property manager with sub-par property insurance will have you named as a co-defendant in an expensive, difficult to win lawsuit. Good insurance is absolutely essential in a property management company.
There are a lot of bad property management companies out there. Property managers who ignore their tenants, who let single-family and multi-family homes and apartments go to ruin, and property managers who scam their landlords.
When you are choosing a property management company, Google the name of their company. Check review sites like Google, Yelp, and Facebook. Occasional negative reviews from angry tenants are inevitable, but if you are seeing multiple 1- and 2-star ratings, especially from landlords, it’s probably time to move on to the next one.
Efficient Leasing and Tenant Turnover
A property management company who keeps your units filled makes you more money. What you’re looking for is efficiency and organization. If a tenant is moving out of one of your units, a good property management company will have the place inspected, cleaned, and posted online in a matter of hours, and have the unit filled within a day or two.
Here again is where in-house staff comes in. If a property manager has to make appointments with a plumber, home inspector, painter and cleaners from contracted companies, and possibly even call in contracted sales staff to show your apartment, your unit is going to be empty for days and possibly weeks.
We hope this article has armed you with knowledge in looking for your next property management company. Remember: a good property management company is a vital decision, and can make the difference between collecting checks every month, and sitting in a courtroom!