Managing your own property is no easy feat, and comes with a plethora of hurdles for you to jump over. In order to maximize profit while maintaining a healthy property, most owners will choose to work with a property management company. Property management companies specialize in marketing and maintaining your property and tending to your tenants.
However, how do you know that you’re choosing the right company for your property?
Here are 10 questions we believe are essential to ask when vetting prospective property management companies.<span class=”Apple-converted-space”>
1. Is Your Property Management Team Licensed?
This is one of the first questions you want to ask, as working with an unlicensed property management company can cause problems for you if legal matters arise. In the state of Florida, any property management company requires a broker license if they are handling rentals or leases for others, or being paid a commission. Many property management teams will also have additional certifications from professional trade organizations.
2. How Many Properties Do You Manage & How Many Employees Do You Have?
The answer to this question will give you an idea of how large the property management company is and what type of service you can expect from their employees. It’s a good idea to figure out what the ratio is between clients, properties, and the number of employees overseeing them. Having one employee handle any more than 50 units may be less than ideal, as this means you’re less likely to get personalized service.
3. How Do You Determine Market Rent Value?
When asked, a property management company should be able to show what the projected market rental value is for your property, based on the current values of the market. With this comparative market analysis, you should see that your property falls within the values of nearby listings while taking into account the unique aspects of your property such as an upgraded kitchen. If the numbers are wildly off, you may want to consider another property management company.
4. How Do You Market/Advertise Your Properties?
Look for a property management company that has a comprehensive marketing program such as internet and social media advertising, professional signage, and includes multiple web listings. A program like this is going to give you high visibility to ensure that your rental is filled with the right tenants.
5. What Is Your Eviction Experience & What Is The Process?
It is important to ask about a property management company’s eviction experience and process, as you’ll want a company that deals with evictions quickly, efficiently, and impartially. An excellent property management team is going to strictly adhere to the lease terms, avoid serious violations, and follow a prompt and careful eviction process.
The process should involve serving legal notices, appearing in court on behalf of the property owner when necessary, and scheduling and performing physical evictions. If the percentage of evictions seems relatively high compared to the number of units being overseen, then it is likely that tenants are not being properly screened.
6. Do You Have Any References?
Always ask for references even if you get a good feeling about a property management company, as you’ll want to hear from others who have worked with them before. A reference can be other clients, real estate agents, attorneys, contractors, mortgage brokers, or even business professionals. When calling, make sure to ask about the bad and the good, to get a well-rounded picture. If the PMC does not want to supply references prior to signing a contract with you, this is a red flag.
7. If I Decide to Sell My Property, Do I Have to Sell It Through You?
Ideally, a property management company should not require you to sell your property through them, but will instead offer their brokerage services to you if you wish to sell. Make sure to read the fine print in the contract before signing.
8. Who Is Your Average Tenant?
Typically, the least worrisome tenants are students, younger professionals, and families, as they tend to be more responsible with paying rent on time. Some companies will also deal with low-income families and section 8 tenants, which is good to know ahead of time, as you’ll need to decide if you’re comfortable with that.
9. What Is The Screening Process Like For Qualifying Tenants?
Ask about what the screening process for tenants entails. While it is difficult to find the perfect tenant, it is quite possible to find numerous good or even excellent tenants to fill your units with. A property management company should have a rigorous screening process that includes, rental application forms, background checks, credit checks, payment verification, previous rental history, and record of payments, as well as, screen for any previous eviction reports and follow-up with provided references. You may also want to ask how long it takes to fill in vacancies, and how security deposits are handled as follow-up questions.
10. Can I Cancel My Contract With You If I’m Unsatisfied?
Before entering into a property management contract, find out what the terms and conditions are surrounding cancellation if you are unsatisfied with the service provided. You’ll want to ask about the length of the term, how renewal works, and what the process is for severing the partnership. Some property management companies may try to lock you into a 12-month contract that is inescapable, so have an attorney look it over before you sign.
If you have a real estate investment property that needs managing, and you are located in the Palm Beach County or Broward County regions of Florida, please don’t hesitate to reach out to us here at Kanga Property Management. Our team is happy to chat with you regarding our services and is eager to help you achieve your property’s full earning potential.