Property Management: Top Questions CRE Investors Should Ask Property Management Companies
Screening of property management companies to aid you in deciding which one to engage is imperative. A professional property management company should preserve the property’s principal value and add advice on ways through which income can be maximized. When screening the potential companies, focus on the following main areas:
• Their experience – A company that has never before handled property management assignments might have a hard time delivering. Ask how long the company has been in business, as well as what property types they have managed. Seek to know how many clients the company has, and if they have the time and resources needed to add your property to their workload. In short, have as much background data on the company as possible.
• Knowledge of property management – A competent property management company should recruit employees that are not only skilled, but well trained too. Find out if they have undergone the necessary training and obtained relevant certification. Most regions require property managers to have some licensing: establish if the company is licensed to run. An affiliation with organizations that educate and offer training seminars should be good pointers.
• Knowledge of the landlord-tenant laws – Keeping in mind that misdeeds on their part can lead to tenants taking lawsuits against you, choose a company that is knowledgeable in landlord-tenant laws. Ensure that they not only know of the state and federal laws on how to deal with a tenant but also understand the landlord’s responsibilities. Thorough knowledge of property safety codes and the process of evicting a tenant should be taken into account.
When choosing a property management company, be on the lookout for their tenant turnover rate. Should it be high, that might not be the right company. How long it takes them to fill a vacancy will also influence your decision.