Your property manager should work for you, without hand holding or prompting.
A quality property manager will have answers to your questions, know the rental laws of Portland and the surrounding areas, and intercept problems before they arise. Finding a PM that is trustworthy and reputable is imperative whether you operate an investment portfolio or a single rental property.
What They Do:
- Determine Rental Price
- Collect Rent
- Advertise and Fill Vacancies
- Communicate to Your Tenant on Your Behalf
- Arrange for and Oversee Repairs
- Maintain Integrity of Property
Selecting a good property manager is crucial when protecting your investment. Image courtesy, Turkeychik
12 Questions You Should Be Asking When Choosing a Property Manager:
- Ask for referrals from other property owners in the area.
- Make sure the company is Local and Legit. Are they licensed in the state of the property that they will be overseeing, and/or are they close enough to the property to be available?
- Experience counts! How many years have they been in service? Have they handled properties similar to yours in the past?
- Look at the numbers. How many employees do they have? One expert says that a good rough number to judge by is that, a trained employee should be able to handle 30-40 units.
- What do they charge? Property managers usually charge between 7 – 15%. Reputable companies in Portland charge on average 10%. However, it’s important to specify if that 10% is charged based on the rents that are actually collected, versus what could be collected. Do you want to pay 10% on a unit that hasn’t been filled? Chances are, probably not.
- How often will they conduct formal inspections of the location? Depending on the type of tenant, whether commercial or residential, this could be a make or break issue in maintaining the integrity of the property. This is something that you will want to come to agreement upon upfront.
- What’s the overall plan? How will they attract and keep quality renters for you? What is their fee for placing a tenant? This is why reviewing their plan for placing and maintaining quality tenants is crucial. These fees can add up if there is a lot of turnover. Remember that everything is negotiable, so set parameters that you and the PM can agree upon.
- What kind of long term calendar items do they have in place to keep your property well-maintained?
Maintenance, collecting rents, inspections, should all be on the agenda of a quality property management company. Image courtesy, Kevin Dooley
- Will they handle maintenance issues? Customarily, a property manager will utilize their own list of vendors and use their own authority to repair damages. These repairs will be paid for out of a reserve fund, up to a certain amount, to repair damages. You as the client can set this limit; it usually falls between $250 – $350. More severe and costly repairs will require a consultation between you and the property manager. There is also a standard fee charged of 10%, on top of the invoice, each time a repair is made.
- Performance and Communication. Check their references. A good property management company should be able to supply you with 3 different references with whom you can check out their strengths, weaknesses, and success stories. This will also give you an idea of the kind of communication and customer service that you can expect from them.
- Facts and Figures. You should feel as though there is a high level of transparency, as this is your investment. Is the company utilizing PM software that will produce reports on collections, fees, maintenance, and taxes?
- Finally, when can they deliver? Set a date each month in which you will receive collected rents and reports.
Happy Hunting!
HSH Property Management is located in Oregon City, and specialize in 4-20 unit multifamily projects and investor portfolio management. However, there is no project too small!
Written by Jennifer Kane, Expanded Exposure LLC.
