Questions to Ask Before Hiring a Property Management Company
There’s a lot that goes into hiring a property management company, and plenty to be proud of on your end. When you’ve reached this step, it’s a sign that your business has grown to a point in which you can truly start to see substantial results. It’s important when you reach this step to conduct thorough research. Your property management company becomes an extension of who you are, and you want them to properly reflect the values you’ve worked so hard to create.
Since this decision can determine the success of your business, we want to help you make the right choice. We created a list of questions to ask when performing the search for the property management company that will represent you. If your prospect can properly answer these questions, you may have found the perfect fit.
Questions About Fees
What Are Your Management Fees?
Management companies collect the majority of their profits for their services by taking a cut of tenants’ rent. This amount can drastically vary from company to company. Oftentimes, the ideal company is one that adjusts their fee according to how many properties you own. If you’re bringing multiple properties to the table, they may be willing to reduce their rates.
Do You Charge Fees When My Properties Are Empty?
You’ll want to know what rates they may or may not charge if a property is vacant. Some properties will collect a reduced amount of pay, while others won’t require any at all. If they still intend on charging their regular fee, you’ll want to know this ahead of time.
What Additional Fees Are There?
Generally speaking, the rent fee most likely isn’t the only fee that your management company will charge you. There may be a few à la carte expenses that could surprise you if you aren’t familiar with them ahead of time. Some things they may charge for include maintenance charges or eviction fees. You should expect some of these, and the company should be upfront about them.
Questions About Tenants
How Do You Screen Tenants?
Generally speaking, the first things a management company generally check are a prospective tenant’s credit score and renting history. There are a few other useful items to know as well. Ask your property management company if they do background checks or employment verification. The more thorough they are with the screening process, the less likely it is that there will be any issues with tenants after they sign the contract.
How Do You Determine the Cost of Rent?
There’s a fine line when it comes to determining how much to charge for rent. You want to be competitive without setting the price too low, and you don’t want it to be so high that the property sits vacant for several months. You should consider factors such as location and amenities when determining a price. Make sure that the company you’re prospecting has a set standard for deciding what to charge tenants.
How Do You Collect Rent?
How a property management company collects rent makes all the difference when it comes to a renter’s standard. In today’s age, there’s no reason for a company to not allow electronic payments, as this may immediately turn a tenant off. A company may accept checks, which is indeed desirable for some tenants. There should, however, be a standard set in the case that a tenant bounces more than one check. Should this happen, the property manager should have restrictions in place to ensure they’re not liable for any fees incurred.
Do Tenants Renew?
If only a couple of tenants don’t stay long, that’s one thing. However, if the majority of tenants leave after one year, you may want to raise a few questions. If a company isn’t readily available, or slow to tend to repairs, the tenant isn’t going to have a good experience. Should the company you’re prospecting have an influx of tenants that don’t renew, ask them what the reason is behind this.
How Do Evictions Work?
When evicting a tenant, a company should be sure that they’re covering all their legal bases. The initial lease signed by tenants should clearly outline what circumstances would lead to an eviction. An eviction typically occurs when a tenant fails to pay their rent or if they neglect another stipulation outlined in the lease. A written warning generally precedes an eviction and evolves from there. Discuss with the management company how they handle this process.
The Company and You
What Experience Do You Have?
The amount of experience someone has tends to speak for itself. A company with an established history heavily suggests that they’ve been doing their job well. Have them give you an outline of their background and present any relevant documents to support their claims.
How Does it Work If I Want to Part Ways?
Know what the process is if you no longer want to work with the company. There are several reasons this could happen, whether it be on your end or theirs. You and the company need to have a conversation about how a breakup would occur, should it be necessary. This includes financial difficulties that create a monetary rift.
Do You Conduct Inspections?
Inspections should always occur before and after a tenant begins residency. It’s extremely important to have everything documented when it comes to the future of security deposits and other factors. Not only should the company conduct inspections, but they should be thorough with them, so be sure to ask about their process. One of the biggest things to know is whether or not they take an adequate number of pictures.
What Are All the Services They Offer?
The more services a management company provides, the more time you’ll have to grow the other aspects of your real estate business. Make sure you know everything they offer and whether or not your tenants will ever have to contact you personally. This includes whether or not the management company outsources its maintenance work. If not, this is something you’ll have to provide.
Trust Your Gut
There’s a lot that goes into being a landlord and having a property management company is a huge part of it. There are various ways in which your relationship can go. If you’ve partnered with a good company, it will lift a huge weight off your shoulders. If not, you may spend a substantial amount of time working out the kinks.
The professionals at Excalibur Homes strive to provide the best possible relationships with their landlords and want to serve all their needs. To speak with one of the best property management companies in Atlanta, Georgia, contact Excalibur Homes today.