7 Tips For Selecting Your Property Management Company

In the current depressed single family housing market renters abound and the rental market has been soaring. Apartment buildings continue to make for great investment opportunities. However, for apartment buildings to cash flow optimally an efficiently managed property becomes increasingly more important. Choosing a property management company that will properly manage your rental property can be difficult. The following tips will ensure you make the right decision.

1. Choose a company that is knowledgeable of the local market

It is absolutely crucial to have a management company that knows the local rental market. Knowledge of the local market means that your property manager knows what renters are looking for. If your property management company is a good one, they will manage your property as if it were their own. They will know your property as if they were a renter. They will also make smart and cost conscious recommendations to the owner that will increase overall return while improving the property so that it becomes more desirable, will help increase rental rates, lower turnover and decrease vacancy. Your property management company should stay abreast of local market fluctuations and make sure that your property always stays competitive in the leasing market.

2. Set up a meeting with the property management company and make a plan.

If the property management company you are choosing is a good one, they will set up a meeting with all new property owners and make a game plan. Following the Institute of Real Estate Management (IREM) dictum, the management plan is the foundation upon which everything else is built. Meeting with your property manager will help improve the interaction and can give both the owner and the property manager a good idea of how they will work to improve the return for that property. Each management plan is different and is based on the goals, plans, and budgets of the owners. Designing a property management plan that is right for each owners needs is the key to successful property management.

3. Ask your property manager for client references.

There is no better source of knowledge about the property management company’s know how than it’s current customers. Ask your property management company to give you the names of three clients who own properties similar to yours. Contact those people and ask them questions that you feel are important to the success of your property. They can usually give a good picture of the strengths and weaknesses of the company and their level of satisfaction with management.

4. Find a property manager with great communication skills.

Wouldn’t it be great if you could always get a hold of your manager whenever needed? Choosing a property management company that strives to offer great customer service and delivers is the way to go. Good communication is something you should expect and a company with good communication skills has to make sure the other aspects of their business are on point because they are always telling you about it. Keeping owners informed and constant communication about the market and how their property is being managed is necessary in any property management relationship.

5. Make sure your money is spent wisely.

Property management companies sometimes give you a lower management rate, say under 4% of gross collected rents (typical fee is 5% of gross collected rents), but turn around and charge every time a contractor has to go to the property, or pad expenditures such as window screens or other minor repairs. Make sure your property management company is looking out for you, bidding out your repairs for the best possible deals or able to profit from their own economy of scale in such a way as to always get you the best possible deal out there. In other words, don’t skimp up front only to get taken advantage of at every turn afterwards. Make the right choice up front and sleep well with the right management company taking care of your property.

6. Find a property management company that knows accounting.

Accounting for revenues and expenses with investment property can be a difficult task. Organization and great accounting skills will ensure your property management company is accounting for your property correctly. At the end of the year when tax season comes up, all of your income and cash flows should be easily accessible and in the correct order to make your tax paying easy. Ask which property management software your company uses and if they can give you 24/7 online access to your accounts via the internet. This ensures you are working with real pros who value transparency at every level.

7. Make sure to find a property management company that good relationship with the tenants.

A great property management company has good relationships with their tenants. Tenants are a customer of the property and should be treated like one. Happy tenants leads too lower turn over, and thus less re-letting fees. Happy tenants will also make releasing much easier. A reputable property management company with a good name in the eyes of the tenant is not easy to come by. Choose a property management company that cares, it will increase your property’s return.