Whether you own one rental house or an entire portfolio of properties, the management side of things can be a pain in the rear. Thankfully, you don’t have to do it on your own. There are property management companies that will take on this burden for you.
What Does a Property Management Company Do?
“Management companies deal directly with prospects and tenants, saving you time and worry over marketing your rentals, collecting rent, handling maintenance and repair issues, responding to tenant complaints, and even pursuing evictions,” Nolo explains. “Plus, a good management company brings its know-how and experience to your property, giving you the peace of mind that comes with knowing your investment is in good hands.”
Another added perk is that a property management company operates as an independent contractor. In other words, you don’t have to bring them on board as an employer and take on all of the added costs and responsibilities that such a relationship requires. You simply pay them for the value they provide.
How to Find Property Management Companies
There are two primary ways you’ll find property management companies:
· Referrals. If you know other people in the industry – meaning other real estate investors or landlords – you might put bugs in their ears for referrals. (Ask for advice on which property management companies are good, as well as which ones are best avoided.)
· Online search. Another good option is to conduct a simple Google search. If you’re in Houston for example, searching Houston property management will give you results for the best services in and around the area.
What to Look for in a Good Property Management Company
With so many different property managers and property management companies to choose from, you have to be sure you’re doing your due diligence to find the right one. Here are a few of the characteristics to be on the lookout for:
1. Solid Reputation
What do other real estate investors and landlords in your area have to say about the property management company? Are there positive online reviews? Negative ones? No reviews at all?
Search Google, social media, and any review websites that you can find – whether industry-based or local. Take pieces of feedback with a grain of salt. Look for the trends. Is there an overwhelmingly positive or negative sentiment?
2. Lots of Experience
It’s not a sin to work with a new property management company that’s just opened up shop within the last couple of years, but you do need to consider whether or not you’re comfortable with being a guinea pig. You’re almost always better off going with a more experienced company that’s seen it all. This will ensure you get better service and greater attention to detail.
3. Diverse Services
You want a property management company that can do anything. If you only require one or two services – like scheduling maintenance and collecting rent – they should be able to offer you this. If you want everything – including property marketing and tenant screening – they should have a comprehensive service package. The goal is to have a scalable service on speed dial so you can effortlessly grow over time with minimal friction.
4. Reasonable Fees
You shouldn’t choose a property management company based on cost alone, but it is important to consider what they’re charging you. Get quotes from multiple companies to get a feel for what the going rate is and how much you should pay for different services.
5. Good Rapport
There’s nothing technical or objective about this last suggestion, but don’t ignore the importance of trusting your gut. A big factor in how you “feel” about a property management company is what sort of rapport exists between you and them.
Rapport matters more than you might think. You’re going to interact with these people a lot over the next few months/years and you need to be sure you get along with them. Otherwise, the friction will be too much to overcome.
Putting it All Together
Choosing to partner with a property management company is a good idea. You just have to make sure you’re choosing the right one. Hopefully, this article has given you some useful food for thought that you can use to make a smart and cost-effective decision.