If you've had rental property for a while, or are shopping for it, you need to be prepared for an avalanche of new responsibilities, unless you opt to let someone else take care of the management details for you. Basically, when you bring in property managers, you are hiring other people to deal with the less attractive aspects of owning rental property. If you don't choose them wisely, that extra income stream from your rentals can diminish to a trickle. There are a few guidelines you may find helpful in hiring a property management group.
Find Out How Vested They Are In Their Business - You will want to learn how many years of experience they have in property management, the number of units they currently manage, the number of employees they have, if they employ their own maintenance team, and if they handle the accounting functions.
Ask How Often They Inspect The Properties They Manage - Ideally, exterior inspections should be done at least once a quarter and interior inspections should be done at least once a year, even if you have a long-term tenant. The manager or his team should also inspect the property following any tenant turnover.
Find Out How Much You Will Be Charged For Management Services - This figure varies a good bit, depending on your market, but the nationwide average is between 7 and 10 percent of the property's rent. Be sure you verify that you will only be charged for the months that rent is actually collected. A vacant rental generates no income, and you shouldn't be charged for that.
Ask What Their Current Tenant Turnover Rate Is - Excessive turnovers or a large number of eviction proceedings may be an indicator that potential tenants aren't being screened properly and that can be bad business for all involved.
Find Out What Kind Of Marketing Techniques They Use To Promote Their Properties - Verify that they are using several different methods to aggressively promote their rental homes, such as listings in local papers, online rental listings, and dedicated rental publications.
Get It In Writing - Make sure all agreements with your rental property management group are run by an attorney. You will also want to make sure that there is an agreed-upon method for ending the arrangement.
Having rental property can be exciting and rewarding, but protect yourself and your investment by following a few basic guidelines.
About the author: SPPM is a leading property management company based in St. Petersburg Florida and regularly writes free tips for many of the leading real estate sites, including Zillow, Activerain, Trulia, and more. For more tips on hiring a property manager, visit their website.
