By
Robert A. Machado, CPM, MPM
I got a call the
other day from an owner of a single family home who was closing escrow on a new
home.
She had been trying to sell the old house, but was getting
no offers. In 30 days the new mortgage
payment was to start and the prospect of making two mortgage payments plus
dealing with the vacant house was going to be difficult. Her new goal was to rent the property for a
few years and then try to sell again.
This situation is occurring over and over again all over the city,
county, state, and nation.
If you need to rent
one or more of your homes, how do you go about obtaining professional advice
and services? What should you consider
as important? As a service to you, I
offer tips in locating a single family home manager.
Tip #1: Find a manager reasonably
close to your property.
If the manager has to drive a long way to get to your rental they will
be less likely to rent it quickly or to inspect it. Does it make sense for someone that is a 40 minute drive from
your property to manage it? A good rule
of thumb is 20 minutes travel time maximum.
The less the better. Once
exception, if the manager lives close to your property, it may be okay for
their office to be in the 40 minute range (they can show it on their way to or
from work).
Tip #2: Find a manager that markets themselves
reasonably well. If the company you are
considering does not sell itself well to you, how good will they be at
marketing your vacancy to prospective renters? How does their yellow pages ad look? How do the materials they mail you look? How does the property manager look? How polished is their presentation to you?
Tip #3: Find a manager that answers the phone during
working hours. Some have no provisions
to handle problems while they are out of the office. What if you need an answer
to your pressing question and no one is there to give you an answer?
Tip #4: Find a manager who has an emergency phone
response after working hours. How
serious is the company about emergencies at your property?
Tip #5: Find a
manager who knows how to screen prospective renters. It is my experience that not enough time is spent discussing this
between owners and managers. The
company should have a written policy that is given to prospects. Do you agree with the policy? Beware if there is no policy! This company could be discriminating without
even doing it intentionally. Is the
written policy adhered to? How are exceptions made? Does the broker review
every rental contract?
Tip #6: Find a
manager that is not too busy. The industry rule of thumb is 75 houses managed
per employee. A property manager that
does their own accounting won’t be showing vacancies when rents are being
posted or when reports are being generated. How do they market the vacancies
during those times?
Tip #7: Find a
manager who has references with properties like yours. A short conversation with them will reveal
things like when they get their monthly proceeds, are calls returned promptly,
how are the properties maintained, and how cost conscious the manager is.
Tip #8: Find a
manager who knows maintenance. Is there a contractor on staff or other
knowledgeable maintenance staff? Are they able to give over the phone tips to
complaining residents that may save a service call? Do they maintain a list of
vendors that is used over and over? This may save you money or cost you money
depending on the property manager. How do they insure they get the best price
and service?
Tip #9: Don’t over
emphasize the management fee. At least
compare apples to apples. Make sure you discuss all costs. Management fee, rental fee, advertising
costs (if free, exactly what is free and what is not), inspection costs, fees
for serving notices, who keeps any late fees collected, extra charges for
handling maintenance, and returned check fees.
These are all fees that you could be charged for as a part of your
agreement with the property management company.
Robert A. Machado, CPM, MPM is owner and
president of HomePointe Property Management, Inc. 429-1205
