{"id":12619,"date":"2020-03-04T13:45:41","date_gmt":"2020-03-04T21:45:41","guid":{"rendered":"https:\/\/www.rentecdirect.com\/blog\/?p=12619"},"modified":"2022-05-25T15:39:35","modified_gmt":"2022-05-25T22:39:35","slug":"how-to-choose-a-property-management-company","status":"publish","type":"post","link":"https:\/\/www.rentecdirect.com\/blog\/how-to-choose-a-property-management-company\/","title":{"rendered":"How to Choose A Property Management Company"},"content":{"rendered":"<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-12632\" src=\"https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/02\/The-Perfect-Match_-How-to-Choose-a-Property-Management-Company.jpg\" alt=\"The Perfect Match: How to Choose a Property Management Company\" width=\"950\" height=\"558\" srcset=\"https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/02\/The-Perfect-Match_-How-to-Choose-a-Property-Management-Company.jpg 950w, https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/02\/The-Perfect-Match_-How-to-Choose-a-Property-Management-Company-300x176.jpg 300w, https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/02\/The-Perfect-Match_-How-to-Choose-a-Property-Management-Company-768x451.jpg 768w, https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/02\/The-Perfect-Match_-How-to-Choose-a-Property-Management-Company-600x352.jpg 600w\" sizes=\"(max-width: 950px) 100vw, 950px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">You\u2019ve inherited some properties or perhaps invested in a few and you\u2019ve decided it\u2019s time to hire a property management company. Find that perfect match for your goals and portfolio with this outlined approach.<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">One: When Should you Consider Hiring a Property Management Company<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Timing on when to consider hiring a property management company goes hand-in-hand with your why for hiring property management over being a private landlord.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A good time to consider hiring a rental management company can be when your:\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Portfolio of rental properties is growing quickly<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Distance from the properties is an issue or you\u2019d like to invest outside your area<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Needing time freedom<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Trying to handle too many tasks alone<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Not interested in management<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Not interested in being an employer<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Properties are regulated by more complex laws and tax implications such as affordable housing or HOA\u2019s.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Delving into commercial property management<\/span><\/li>\n<\/ul>\n<h2><span style=\"font-weight: 400;\">Two: Time to Draft a List of Local Rental Management Companies<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Out of habit, the first inclination might be to hit the world wide web and search for the phrase \u2018property management companies\u2019 &#8211; be prepared to be overwhelmed &#8212; a recent quick lookup brought <\/span><em><strong>4.5 billion<\/strong><\/em><span style=\"font-weight: 400;\"> search results.<br \/>\n<\/span><\/p>\n<div id=\"attachment_12684\" style=\"width: 866px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-12684\" class=\"wp-image-12684 size-full\" src=\"https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/03\/internet-search-for-property-management-companies.png\" alt=\"internet search for property management companies\" width=\"856\" height=\"212\" srcset=\"https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/03\/internet-search-for-property-management-companies.png 856w, https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/03\/internet-search-for-property-management-companies-300x74.png 300w, https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/03\/internet-search-for-property-management-companies-768x190.png 768w, https:\/\/www.rentecdirect.com\/blog\/wp-content\/uploads\/2020\/03\/internet-search-for-property-management-companies-600x149.png 600w\" sizes=\"(max-width: 856px) 100vw, 856px\" \/><p id=\"caption-attachment-12684\" class=\"wp-caption-text\">Research Tip: This example shows why it&#8217;s important to narrow your search and avoid overwhelm. Try to be as specific as possible in regards to your portfolio when internet searching property management companies to hire.<\/p><\/div>\n<p>Although you\u2019ll likely get a list of local property management companies at the top, it will be a shot in the dark to simply start calling them without a little research and prep.<\/p>\n<p><strong>Three Tips to Narrowing Your Search<\/strong><\/p>\n<ol>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Be specific in your internet search. For example, the term \u2018Commercial Property Management\u2019 will yield a better result than the generic key phrase \u2018property management companies\u2019.\u00a0 <\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">If your portfolio is mostly single-family dwellings or an apartment complex you may want to search \u2018residential property management companies\u2019 or \u2018apartment management companies\u2019. <\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">From there, most search engines will allow you to sort by ratings. <\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Perhaps a better route would be to reach out to your local real estate, landlord, or property management associations for referrals.\u00a0 <\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Again, going to the experts, search professional directories such as:\u00a0<\/span><\/li>\n<\/ol>\n<ul>\n<li style=\"list-style-type: none;\">\n<ul>\n<li><a href=\"https:\/\/www.narpm.org\/find\/property-managers\/\"><span style=\"font-weight: 400;\">National Association of Residential Property Managers<\/span><\/a><\/li>\n<li><a href=\"https:\/\/www.biggerpockets.com\/real-estate-companies\/property-management\"><span style=\"font-weight: 400;\">BiggerPockets<\/span><\/a><\/li>\n<li><span style=\"font-weight: 400;\"><a href=\"https:\/\/www.managemyproperty.com\/\">ManageMyProperty.com<\/a>\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2><span style=\"font-weight: 400;\">Three: Understand the Property Management Services Offered<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Before hiring a rental property management company, it\u2019s good to know what services the typical pm company provides. If you\u2019re new to the rental industry, you might not be aware of all the tasks a landlord and\/or property management company juggle.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Here\u2019s a glimpse into the <a href=\"https:\/\/www.rentecdirect.com\/blog\/what-does-a-property-manager-do\/\">property management duties and responsibilities<\/a> most pm companies handle on the behalf of a landlord:\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Rental market research and setting rent amounts<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Vacant rental marketing and advertising<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Tenant screening and selection<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Lease negotiations and signing<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Tenant relations<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Rent collections, delinquent rent collections<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Legal issues such as compliance, regulations, and evictions<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Routine rental inspections<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Emergencies and disasters<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Financials: bookkeeping, handling tenant and owner funds, reports<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Maintenance, repairs, remodeling<\/span><\/li>\n<\/ul>\n<p style=\"padding-left: 40px;\"><span style=\"font-weight: 400;\">&#8230;and the list goes on<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Four: Property Management Fees Rundown<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">From the list above, a property management company would be caring for your properties and the tenants fulltime as if they were their own. <\/span><\/p>\n<blockquote>\n<pre style=\"text-align: center;\"><em><span style=\"font-weight: 400;\"><strong>A good property management company is worth its weight in gold.<\/strong>\u00a0<\/span><\/em><\/pre>\n<\/blockquote>\n<p><span style=\"font-weight: 400;\">Have a good grasp of the fees going in to weigh against your desired long-term investment goals. This understanding will help you compare rental property management companies and consider if their fees are reasonable and customary.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Be prepared to pay 7-10% for the monthly management fee. From there, other fees you may be asked to pay could range from a setup or onboarding fee to a fee when a new tenant moves in or renews their lease.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">In addition to the above, the management company may impose additional fees for services rendered. This article delves into further detail:\u00a0<\/span><a href=\"https:\/\/www.rentecdirect.com\/blog\/property-management-fees-how-much-do-property-managers-charge\/\"><span style=\"font-weight: 400;\"> All you Need to Know About Property Management Fees<\/span><\/a><\/p>\n<h2><span style=\"font-weight: 400;\">Four: Know What to Look for in a Property Management Company<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The main qualities to look for when you choose a property management company are:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Compliance to regulatory concerns such as licensing and insurance<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">A good reputation online and within their offered references<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Professionalism to include accountability, friendliness, and responsiveness<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Use of <a href=\"https:\/\/www.rentecdirect.com\">property management software<\/a> that offers tenant portals for online rent payments and maintenance requests, owner portals for access to reports and ledgers, online ACH owner payments (owner disbursements).\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Proactive and not reactive &#8211; they have disaster plans, contingency plans, and standards in place.\u00a0\u00a0<\/span><\/li>\n<\/ul>\n<h2><span style=\"font-weight: 400;\">Five: Research and Interview Prospective PM Companies<\/span><\/h2>\n<p><strong><i>Top Questions to Ask<\/i><\/strong><i><span style=\"font-weight: 400;\"><br \/>\n<\/span><\/i><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Background and company details:\u00a0<\/span>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">How long has the property management company been in business<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Qualifications of management and staff<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Size of the company<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">How many properties are under management<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">How many owners do they represent<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Response time and contingency planning<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Do they invest and manage their own properties<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Are they members of any organizations or associations<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Rent statistics:\u00a0<\/span>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Vacancy rates<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Occupancy rates<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The average length of tenancy<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Rent collection statistics:\u00a0<\/span>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">% delinquent<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">percent collected by 1st, grace period, 10th, 20th, end of month<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The late fee charged to the tenant and is it kept by the management company<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Maintenance and deferred maintenance<\/span>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Is an owner contribution required upfront for unexpected or routine maintenance or are funds withheld monthly from the income for that purpose?\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Which maintenance items are typically recommended to defer?<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">When and for what purpose are inspections conducted?\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Tenant relations:\u00a0<\/span>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Are online portals offered for tenants to pay rent electronically?\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Can a tenant submit a maintenance request electronically?<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Are there satisfaction and\/or retention programs in place (surveys, welcome baskets, etc)?\u00a0 If so, ask for details.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The eviction process: eviction and turn over rates\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2><span style=\"font-weight: 400;\">Six: Tips on How to Choose a Good Property Management Company<\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Once you\u2019ve narrowed down your options to a shortlist it\u2019s time dig a little deeper to choose a good pm company.<br \/>\n<\/span><strong><br \/>\nLicensing and insurance<\/strong><\/p>\n<p><span style=\"font-weight: 400;\">Lookup licensing online to make sure they are current and in good standing. It is also good to confirm their insurance policy information and ask what insurance levels you will be required to maintain.<\/span><\/p>\n<p><strong>Reputation<\/strong><\/p>\n<p><span style=\"font-weight: 400;\">Not only can you find reviews directly on search engines these days, but there are dedicated sites from for reviews such as <\/span><a href=\"https:\/\/www.angieslist.com\/companylist\/property-management.htm\"><span style=\"font-weight: 400;\">Angie\u2019s List<\/span><\/a><span style=\"font-weight: 400;\"> or <\/span><a href=\"https:\/\/www.zillow.com\/agent-finder\/property-manager-reviews\/?showAdvancedItems=false\"><span style=\"font-weight: 400;\">Zillow<\/span><\/a><span style=\"font-weight: 400;\">.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">You might also want to search what employees are saying about the property management company they work for by looking up employee reviews on sites such as <\/span><a href=\"https:\/\/www.glassdoor.com\/Reviews\/property-management-reviews-SRCH_KE0,19.htm\"><span style=\"font-weight: 400;\">GlassDoor<\/span><\/a><span style=\"font-weight: 400;\">.\u00a0\u00a0\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Ask for a list of referrals from the management company and be sure to call every owner to ask for their insights and observations regarding those areas that matter most to you.\u00a0<\/span><\/p>\n<p><strong>Responsiveness<\/strong><\/p>\n<p><span style=\"font-weight: 400;\">Call them a few times during a business day, perhaps on different days and drop them an email to research their responsiveness, professionalism, and friendliness.\u00a0<\/span><\/p>\n<p><strong>Reporting and documentation review<\/strong><\/p>\n<p><span style=\"font-weight: 400;\">Ask them for a copy of their management agreement, a sample tenant lease agreement, and sample owner reports. Reviewing these will be important for comparing those on your shortlist.\u00a0<\/span><\/p>\n<p><strong>Marketing and tenant materials<\/strong><\/p>\n<p><span style=\"font-weight: 400;\">Ask to see a vacancy posting and\/or any brochures and marketing material. Do they stage their rentals, are the pictures clear, is the advertising clear and avoids discriminatory language? <\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\"><br \/>\n<\/span><span style=\"font-weight: 400;\">Check out their welcome packet for tenants and any other tenant handouts. Do these marketing and tenant relations materials fall in line with your core objectives.\u00a0<\/span><\/p>\n<h2><span style=\"font-weight: 400;\">Seven: Know When it\u2019s Time to Change Property Management Companies<\/span><\/h2>\n<blockquote><p><span style=\"font-weight: 400;\">We don\u2019t know what we don\u2019t know, right? The grass isn\u2019t always greener but if you are lacking these key elements, maybe it\u2019s time to choose a new rental property management company. <\/span><\/p><\/blockquote>\n<p><span style=\"font-weight: 400;\">Signs it may be time for a change:\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Responsiveness has changed<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Bookkeeping and data-entry errors are popping up<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Online reviews are turning negative<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Tenant turnover is increasing<\/span><\/li>\n<\/ul>\n<p>Perhaps you are leaning towards starting your own property management company or would like more information on investment opportunities and useful landlord information, check out the related reading below.<\/p>\n<hr \/>\n<h2>RELATED READING FOR YOU:<\/h2>\n<ul>\n<li><a href=\"https:\/\/www.rentecdirect.com\/blog\/how-to-get-into-property-management\/\">Insider Tips: How to Get Into Property Management<\/a><\/li>\n<li><a href=\"https:\/\/www.rentecdirect.com\/blog\/build-a-property-management-team\/\">How to Build a Property Management Team<\/a><\/li>\n<li><a href=\"https:\/\/www.rentecdirect.com\/blog\/turnkey-property-investing\/\">Understanding Turnkey Property Investing<\/a><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>You\u2019ve inherited some properties or perhaps invested in a few and you\u2019ve decided it\u2019s time to hire a property management company. Find that perfect match for your goals and portfolio with this outlined approach. One: When Should you Consider Hiring a Property Management Company Timing on when to consider hiring a property management company goes [&hellip;]<\/p>\n","protected":false},"author":69,"featured_media":12632,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":true,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"iawp_total_views":9,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[275,13882],"tags":[14180,570,14182,14181,29],"class_list":["post-12619","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-education","category-landlord-tips","tag-checklist","tag-landlord-tips","tag-outsourcing","tag-pm-company","tag-property-management","et-has-post-format-content","et_post_format-et-post-format-standard"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.5 (Yoast SEO v27.5) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>How to Choose A Property Management Company<\/title>\n<meta name=\"description\" content=\"You\u2019ve inherited some properties or perhaps invested in a few and you\u2019ve decided it\u2019s time to hire a property management company. 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