Questions Investors Should Ask Before Considering a Property Management Company
Real estate has quickly become one of the most popular investment industries, and with good reason. If you’ve been thinking about hiring a property management company to help with your business, you’ll want to weigh your options carefully and make sure you choose a company that will actually help you rather than potentially ruin your investment.
Setting a Foundation
Before you launch into pinpointed questions, get the basics out of the way. Examples of fundamental questions to ask include:
- What kind of properties do you manage? (as in apartment, single family homes or commercial)
- How many rental properties do you personally own?
- What’s the number of units you currently manage?
- How long have you been a property manager?
The answers to these questions start to draw a picture of the type of property management company you’re dealing with. Not only that, but the answers can also tell you whether you should even ask more detailed questions or take your business elsewhere.
In Regards to Your Property
Once you’ve decided to continue with the management company you’re interviewing, you’ll want to focus on the property you’re thinking of buying up. Ask prospective property managers which parts of town they consider to be favorable rental markets with low vacancy rates. You should also inquire which locations the manager would currently invest in and the types of property in which she or he would invest. It’s also a good idea to ask how the management company would improve your property and protect your investment.
Make It Personal
Be sure you focus on the capabilities of the property management company as well. Specific questions to ask include:
- How many staff members do you have? Do you contract any of your work out?
- How do you handle evictions starting on the first day rent is late?
- Can you describe your screening process for tenants
- In your standard lease agreement, what do you list as tenant responsibilities?
- Can you provide me with at least three references?
The answers to these questions will give you a better indication of if you’re dealing with a competent and capable management company, which your future tenants are sure to appreciate. Following this same line of thought, put yourself in a potential tenant’s position. If you were considering a property managed by the company you’re considering, would you sign a lease?
Take your time and do your due diligence when it comes to finding the right property management company. Work with a management team that cares just as much about your investment and your tenants as you do.