When you hire a property manager, you’re practically handing the reins of your rental business to them. To ensure the success of your venture, it’s important to hire the right professional.
What should you look for in a property manager, and how can you find the right one? Consider these tips.
- Ask for referrals
Tap your network to start your search. Ask friends who may have investment properties in the same area. Your Realtor may also know someone who’s qualified. Other professionals with dealings in real estate, such as a lawyer or contractor, might also be able to refer someone to you.
Ask your sources about what it was like to work with prospective managers. Then check with Idaho’s Real Estate Commission or consumer services like Better Business Bureau to find out if these candidates have the right licenses, and if there have been complaints against them.
- Search on the internet
Look up property managers who serve your area, including those who were referred to you. Get as much information as you can about those you think are good candidates, including reviews and testimonials from former clients or tenants. Check out their websites and look into the type of properties they have worked on. Review the quality of their website as well. If it’s professionally done and properly managed, that may reflect on the kind of service you can expect.
- Shortlist and interview candidates with potential
Talk in person to as many candidates as you can. A face to face conversation will give you a better feel of who you’ll be most confident and comfortable working with.
Take note of first impressions. How does each one respond to your questions? Are they dismissive or receptive? Are they someone you’d want to represent your business? If you were a tenant, would you rent a property managed by them?
Prepare your questions in advance. The most important details to thresh out include:
- What are their marketing strategies?
- How much experience do they have?
- How knowledgeable are they with local and federal rental laws?
- How many properties are they currently managing? How much time can they devote to managing yours?
- How many vacancies do they have at the moment?
- How long does it normally take them to fill up a vacancy?
- What type of properties have they managed?
- How do they handle property maintenance?
- What actions do they take in case of problems or disputes with tenants?
- What system do they follow in collecting and managing rent?
- What is their fee structure?
- Visit prospective managers’ properties
Get a firsthand impression of how a prospective manager works by visiting one or two of the properties they manage. Does the place look clean and well-maintained? Is it presentable and attractive to renters? Are there obvious signs of disrepair?
Try to talk to tenants. Are they happy with how their building or home is being managed? Are their complaints addressed promptly? Do they plan to renew their lease, and if not, what are their reasons?
- Review and negotiate management contract terms
A management contract outlines the details and conditions of your working relationship with the property manager. You will both be committed to the terms of the contract so make sure they’re clear to you and that your interests are protected. It’s best to have a lawyer review the contract before you sign on it.
Some of the details to watch for include:
- Communication – Make sure you know who your point of contact is, how to get in touch with them, and they’re accessibility through various means, such as email and phone
- Fee structure – This has to be consistent with what you discussed during the interview stage
- Termination of agreement – If you’re not satisfied with the property manager’s performance, what steps do you both need to take to end the relationship and how long is the notice required?
- Rent payments –When can you expect to receive the rent from tenants each month and how will it be sent to you?
- Security deposit –Who keeps it and how?
- Maintenance and repair –Will the property manager hire a retainer? Will jobs be outsourced, and if so, will the manager receive a percentage on top of the repair costs?
You or the property manager may prepare the tenant’s lease agreement. Many property managers use a general lease agreement that may have been done by someone else. If you agree to have the manager prepare the agreement, it would be wise to have your own attorney go over it to make sure it complies with relevant laws.
Check if the agreement clearly details the most contentious issues, including:
- Security deposit
- Late rents and potential consequences
- Tenants’ responsibilities
- How tenants’ complaints are processed