Investing money in real estate is a lucrative business, which might be why 48% of all rental properties have individual owners who manage them. Large investment firms own the rest.
You might be fine managing one or two properties, but can you manage more? If you’re hoping to grow your portfolio by owning many rentals, you might need to turn to a property manager.
Hiring a property management service company allows you to own investment properties without dealing with the day-to-day operations. But you’ll need to choose the right company.
Of course, you’ll need to ask the right questions when hiring a company. So keep reading to learn the top seven questions to ask before hiring a property manager.
1. How Large Is Your Business?
One question you might ask a property management company is about their size. For example, how many properties do you manage? Additionally, you might ask how many employees they have.
Learning these things can help you determine if they have the capabilities of taking on your properties. If a company seems too large and overrun, you might look for a different one.
However, if the company appears to have plenty of employees, they might be ideal for your business.
When asking about the company size, you might also ask about their experience. For example, how long have they been in business?
2. What Services Do You Offer?
When you decide to hire a property management service company, you’ll need a business that offers the services you need. Therefore, you can ask about their services.
Most property management companies offer full-service businesses, which include the following services:
- Tenant selection
- Advertising and marketing
- Unit preparation
- Maintenance and repairs
- Paperwork
- Emergency phone calls
- Rent collection
- Eviction procedures
These are some standard tasks you can hire a property management company to do, but there are others. So if you need a specific service not on this list, talk to the company.
Most property managers are willing to perform the unique services rental property owners need.
3. Can You Customize Your Services?
One of the best property management tips to learn as you look for a company is to find one that offers custom services. Custom services mean you can specify what tasks they do and don’t do.
In other words, you won’t have to hire them to do every task if you want to do some.
For example, maybe you enjoy choosing tenants for your properties. If you’re good at doing this task, you might want to continue doing it.
Some rental property owners might not want to do any tasks related to the properties. Instead, they hire a property manager to handle them all. Others, though, might need a property manager to handle only a few tasks.
4. How Do You Choose Tenants?
One of the top reasons people hire property managers is for tenant selection. You might not know how to perform tenant screenings or what to look for when selecting tenants, but a property manager does.
Therefore, you might want to ask about their methods for tenant selection. For example, what steps do they take to research a person? Do they charge a fee when accepting and processing applications?
Property management firms generally perform several screening types when processing applications.
First, they might run a credit check to ensure the person is creditworthy. Secondly, they might run a criminal background check to ensure the person is safe and responsible.
Some property managers also perform other screenings, such as an employment verification screening.
5. What Does the Maintenance Schedule Look Like?
The best property management service company offers thorough maintenance for all your properties, but you should ask what this includes.
Maintenance is vital for the upkeep and value of your properties, so this service is a beneficial one to include when hiring a company. Most property management companies use a schedule for these services.
The schedule might include weekly maintenance tasks, such as mowing, trimming weeds, and replacing burnt-out light bulbs. It might also have a monthly, quarterly, and annual list of maintenance tasks.
6. What Insurance Types Do You Have?
Next, it might be helpful to ask about the company’s insurance policies. The property manager you hire takes over the tasks you normally do. Therefore, they take on risks and liability when they agree to manage your properties.
As a result, a property management firm should have the following insurance types:
Fidelity Bonds
A fidelity bond is vital for a property management firm. This type of bond protects against issues caused by employees, such as theft.
General Liability Insurance
General liability insurance protects against accidents that happen to people who visit your properties. For example, general liability insurance covers a slip and fall incident that occurs on your property.
Professional Liability Insurance
Professional liability insurance protects against the work the property management firm performs. For example, if they install something improperly that causes damages or injuries, this insurance covers it.
7. How Much Will It Cost?
Finally, you can discuss the costs. The costs for hiring a property manager vary, but they’ll give you a solid quote when hiring them.
It’s important to know that the fees you pay might seem like a lot at first. However, the services they provide can help your business grow and become more profitable.
In other words, you’ll have less work to do and have the potential to make more money.
Hire a Property Management Service Company for Help
You can choose to manage your rentals yourself, but consider the costs of handling the duties. After all, they take time and effort and can be stressful.
On the flip side, paying a property management service company to do the work for you relieves these duties, pressure, and responsibilities. Additionally, property managers have expert experience in this field.
Feel free to contact us at Reedy & Company. We’re located in Memphis and offer reputable property management services. We can help you grow your business and succeed as a landlord.
