Finding and hiring a good property manager is like any other hiring process and starts with a good interview. To have a good interview, you need to have your list of questions prepared and know what qualities you want in your property manager.
First, you will need to ascertain how they qualify potential tenants – what are their income and screening requirements? Make sure they have a well-defined process for checking employment, credit and income. Minimum income threshold should be 3x rent.
How do they market rentals? Make sure they are marketing aggressively and not passively waiting for a tenant to show up. How many properties do they manage, this will help you gauge their size and experience. Personally, I look for property managers with 80 + units, which is big enough for them to have experienced a variety of problems and have a track record verifying their success.
How do they set rent prices? Can they pinpoint the optimal rental rate? They should also be able to explain local ordinances and Fair Housing laws.
The managers must know and understand all the laws associated with rentals in order to look out for your best interest. You will also need to gain an understanding of what their average occupancy rate for the units they are managing. Higher occupancy rate = more cash flow. If the unit is vacant, you cannot make money. Look for a property manager who has a history of having a occupancy rate below 5%.
It is important to understand the fee structure. Some property managers charge a flat rate while others charge a percentage of rent. Flat fees may continue even though apartments remain unoccupied. I usually prefer paying a percentage of the rent since I feel that this fee structure incentive the manager.
Finally, as with any hire you need to listen to your instincts. Is this property manager one you can trust?
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