Hiring a dedicated property manager for your rental properties can be a great way to alleviate stress and streamline the real estate investing process. However, a manager who is not performing up to par can have serious implications for your rental property as a business. Here are several bad manager behaviours to watch out for. If your property manager meets one or more of these criteria, it may be time to fire them and find a better one.
Because you are essentially entrusting your rental business to your property manager, you need to be able to communicate regularly. If you are repeatedly having difficulty getting a hold of your property manager, either by email or by phone, this could be a sign that other things are going on that your manager is trying to hide from you. Aim to be in touch at least fortnightly, preferably weekly, to stay up to date.
Your property manager should be conducting a thorough inspection of your property
every 3 months or as directed by your relevant legislation. At the very least, your units should be inspected after each tenant moves out so that you can make any necessary repairs or modifications to stay in compliance with local regulations. A property manager who isn't conducting regular inspections for you may be cutting corners in other areas as well, so keep an eye out for any discrepancies.
Choosing the right tenants for your rental properties takes thought and care. Your property manager should be conducting thorough background and credit checks for every rental applicant. This can include calling previous landlords for references or employers for employment verification.
Applicants should also be able to prove that they can afford the rent payments. A property manager who fails to vet prospective tenants is likely doing your property more harm than good.
Some property managers charge a flat fee for their services, while others charge a percentage of the property's monthly rent, typically about 10 percent. Many also charge a finder's fee for new tenants, usually equivalent to one to two weeks rent. Of course there are some managers who charge higher rates, but beware cheaper fees is not always a good thing - there is a reason a ferrari costs more than a kia. Shop around at other property managers in your area to compare rates.
Your property manager should be keeping thorough reports of all the details related to your property, including:
The reports you receive should summarise the most important information, but your property manager should also be able to provide you with more detail if requested. Verifying the reports occasionally can alert you to any discrepancies that could indicate your property manager isn't managing your investment well.
Of course, your property manager will handle many of your tenants' complaints about your property, but if the complaint is about the manager, you'll need to address them. Take tenants' comments seriously and investigate any negative claims. Discuss any issues with your property manager to help resolve them. If a manager is constantly receiving complaints, it is likely time to find a new one.
While it may seem daunting to find a new property manager for your properties, you don't want to be stuck with a poor property manager who is running your properties, and your income, into the ground. Take the time to shop around to find the best manager to meet your needs. It may take a bit of time and effort to find the perfect match, but you'll be grateful when your properties are being adequately managed.