How to Find the Best Property Management Service
If you own a vacant property, renting it out is a smart move. Your property becomes a source of regular income. Being a landlord is not an easy job. It requires dealing with legal issues, tenant rights, collecting rent, screening applicants. Landlords must keep up with the property’s maintenance, and more. It’s easy to feel overwhelmed, especially if it’s your first time being a landlord.
This is why the vast majority of property owners turn to property management services. The property manager handles every aspect of running the property. They work to ensure it’s profitable and stress free for you.
The property manager is there to represent you and protect your interest. This is why you need to choose a property manager you have trust and confidence in.
There are likely several property managers in your local market. Some may have professional values and top-notch service. Others might be more concerned with putting money in their own pocket than protecting your interests. Choosing the wrong property manager is a sure way to get a low return on investment and possibly end up with a legal mess on your hands.
So how do you find the best property management company? In this article, we’ll help you understand what to look for in property management services.
Finding the best property management service is similar to finding any other professional service provider. First impressions matter.
- Do they answer the phone professionally?
- How quickly do they respond to emails and phone calls?
- Is the office well organized or files are lying here and there?
Take note of how you’re received and treated the entire time. First impressions can give you insight into the kind of people you’re working with. How they treat you, is likely how they will treat your tenants.
Professional Experience and Reputation
Great property management takes a combination of experience and knowledge. As such, it’s important to consider the professional experience of any property management service.
Newly established property management companies may lack the necessary experience to manage your property effectively. A property management company that’s been successful in business for a few years no doubt knows what it takes to manage a property and its tenants.
When choosing a property manager, you’re choosing someone to represent you. Someone to work with your tenants. Carefully consider the professional reputation of the organization. It’s possible to find a company that has been in the game for several years, but over this time, it has left behind a trail of frustrated clients. The best property management service must have a good reputation.
Go online and look for the business name of the company you’re considering.
- What are people saying about the company?
- What client reviews and testimonials are available?
- What rating do they have with the Better Business Bureau?
Ask for a list of past clients to talk with. Get in touch with a few of them and hear what they’ve to say about the service.
The Technology Behind the Service
Regardless of industry, technology is changing how businesses operate. In property management, there are digital solutions that make the work easier, be it rent collection or tenant complaint reporting and resolution. A property manager who embraces such tech solutions is far more likely to be efficient at the job.
Therefore, it’s essential to ask all potential property management services about how they get it all done behind the scenes.
- What methods and tools do they use for tenant screening?
- How do they set and collect rent?
- Do they have a digital marketing strategy?
- Do they have a well-designed site with owner and tenant portals?
- Is it easy for tenants to communicate any property issues?
If you find that a property manager who relies on archaic methods, you’re better off moving on to the next one on your list. The modern tenant is tech-savvy and, as such, more likely to rent a house managed by an equally tech-savvy company.
Property Management Fees
Cost is always a consideration when hiring a property management company. Afterall, you’re renting your property to increase your assets and financial return.
It’s important understand the various fees property management companies might charge.
This is the money you pay the property manager for its management services. It’s usually a certain percentage (typically 8-10%) of the monthly rent.
What usually determines the percentage is the type of property, number of units and location. A property manager is likely to charge more for an apartment complex in a metropolitan area than an out-of-town single-family detached home.
There are property management companies that charge a fixed fee for full-service property management. If you are hoping to maximize your profits, a company like this should be top on your list. Fixed fee property management means you pay the same price regardless of the amount your property rents for. This almost always mean a cost savings to the landlord.
This is a one-off fee payable when the company takes you up you as a client. Not all companies charge a set up fee. For those that do, it can be as much as $300.
If the company earns its fees from the collected rent, what happens when the entire property (or a couple of units) are vacant? This is where a vacancy fee comes in. Some companies will have a standard vacancy fee per unit, which is usually prorated when it the unit rents again.
Fixed fee property management companies often do not charge a vacancy fee. The business model of a fixed fee management company is designed to provide services at a fair value to its clients. If there is no tenant, why should the landlord pay a management fee?
If you have been a tenant before, you can recall that part of the money you had to pay when moving into a new apartment was the lease fees. Property managers charge this fee to compensate themselves for the time and effort involved in acquiring a new tenant. Although it doesn’t come from your pocket, it’s still important to consider. High lease fees can discourage potential tenants from renting your property.
It’s important to review what other fees a property management company may charge. Property managers who charge a lower percentage may have miscellaneous fees for things like advertising a vacant property or handling an eviction.
Not every company charges every fee you see listed. Some companies may charge fees not included here. It’s important to ask questions and review contracts in detail to get the best service for the lowest price possible.
Finding the Best Property Management Shouldn’t Be Hard
You now have the information you need to find a property management service that suits your needs.
Here at VerraTerra, we provide full service property management services. We’re a tech-savvy firm. Unlike many other companies, we charge a flat fee for our service. Get in touch with us today to learn more.