So, you are in the market for a Property Manager.
My guess is that this decision is important to you.
It’s not one of those decisions that’s similar to purchasing, say, a stapler. While you may have a favorite and trusted place to buy a stapler, most people will generally look at the price, scan whatever features a particular stapler may have and make a quick decision.
If you’ve ever spent more than 1-2 minutes debating the type of stapler to buy, I’m certain you are in the minority.
Now, let’s compare that to searching for a daycare provider for your child.
In most cases, referrals from other parents you know will weigh heavily in your decision. If that’s not an option, you most certainly will read reviews of different daycares, visit the daycare or daycares you find appealing, and only enter into an agreement with a specific daycare provider when they’ve established a very high level of trust with you.
Where you place your child for potentially thousands of hours each year is a big decision and a decision you will only make after carefully reviewing your options.
And my guess is that price won’t be the determining factor. It will be part of the decision, for sure, but not the same way you decide on a stapler.
Finding the Right Indianapolis Property Management Company is Important
Shopping for a Property Management company should require some work on your part. After all, you are turning over the keys - literally - to one of the biggest assets you own. If you turn those keys over to a property manager that's ill-equipped to manage your home, you could open yourself up to a lot of headache and, ultimtately, a lot of lost money.
Today, I thought I would review 5 tips to ensure you find the ideal Property Manager for your home.
No Property Managers are alike. We all have our differentiating factors - or at least should have differentiating factors - that, if you research long enough, will align with your own specific needs and wants.
Indianapolis Property Management: Tips to find your best match
- Do the owners of the PM Company own rental real estate? This is a critical question to get answered right away. If they don’t own their own rental real estate, or have never owned rental real estate, it’s a huge red flag.
Would you hire a stock broker that didn’t invest in the stock market? Would you hire a coach who had no experience playing the sport? Of course not.
Owners of PM Companies that own rental real estate have tremendous insight into the pain points, needs, and wants of fellow investors. They have walked in your shoes and generally know what’s important to you.
I do not buy the claim that these owners, generally, will fill their vacancies before yours. Well-run companies will use consistent marketing methods for all homes. You could use the same argument for management companies that could manage dozens or even hundreds of homes for a single organization… what’s to prevent them from pushing their larger client’s properties ahead of yours?
Bottom line: You have to trust the management company you choose. In order to gain that trust, call them, research them, and don’t move forward until you are comfortable.
- Understand ALL the fees. Unfortunately, management companies generally do a very poor job of listing their fees on their website. That’s why you’ll not only need to get a copy of a Property Management Agreement, but also ask the specific question, “Can you tell me all the fees I will have to pay for your services?”
Price is important, but it shouldn't necessarily be the most important factor in your decision. Generally, well-run, experienced Property Management companies will charge higher than average fees. But, in return, they should provide a higher level of service, get your properties rented more quickly, and attend to maintenance more efficiently. This all translates into a higher return for you.
- Understand Communication Policies. Again, the number one complaint about Property Managers is the lack of communication. That’s likely because most management companies have not created a company culture that stresses communication, or they don’t have the property staffing in place to allow for prompt communication.
Ask what their corporate policy is regarding communication. What is the preferred method of communication? How fast will your inquiry be returned?
Few things will frustate you more than not getting your questions answered. Your investment is very important to you and when you need answers, you need a property management partner who will provide them... promptly.
- Ask about the Staff Size & Experience. If the management company doesn’t have a full staff listing on its website, you’ll need to uncover this information during the interview. It’s critical that whatever company you choose is fully staffed to meet your needs. There are not any perfect ratios out there, but if the solution you are considering has more than a 50:1 ratio (50 properties for every employee) you should probably continue your search.
Along with this, a woefully inexperienced staff can be just as dangerous. Not only should you ask how long the company has been in business (not just in real estate, but managing 3rd party properties) but also ask for the average experience of its employees. Experience matters greatly, so don’t discount or overlook it.
- Understand maintenance protocols. Every management company should document, exactly, how they will handle maintenance within their Property Management Agreement. If they don’t, you should be concerned. You’ll need to understand when the PM must get your approval for maintenance, or when/how you will be notified when maintenance occurs.
You should also understand how your Tenant - your customer - can expect maintenance to be handled. What's the best method for the Tenant to submit work orders? What response time should the Tenant expect? What emergency maintenance protocols are in place?
Again, finding the right Property Management company is extremely important, and well worth the time involved to ensure you've found the right match.