What to expect when you hire a property manager
As the property manager of over 150 residential units in New Jersey, I thought this would be a good article to share with you to help with some of the expectations you might have that comes with hiring a property manager. So what can you expect when you hire a property manager? Let's break it down.
The first thing we do as property managers is make sure we have proper documentation from our clients and for their properties. Documents will include lease copies, your certificate of occupancy copy, fire certifications, etc. If you are going to hire a property manager, you want to make sure you have these. Sometimes our clients don't have the copies and that's ok! We help them to get the copies by getting the proper inspections from the town, or contacting the tenants to see if they have a lease copy. Notwithstanding, documentation is an important first step when you hire a property manager.
This is arguably the most important task to nail down. How much rent is being collected? Is anyone late? When we first introduce ourselves to the tenants, we explain to them how they can pay rent going forward. Sometimes it takes a few months to get used to our system of payment but we generally don't get much pushback from the tenants.
Maybe your books weren't tidy and you haven't kept track of expenses that well? Now that you have a property manager, a good one will send you a monthly income statement. We send one each month once we have sent a disbursement payment to the owner and it will show all rent collected minus management fees and any repairs that were done.
One thing you need to do is not micromanage your property manager. If you feel the need to do this, maybe you aren't ready to let someone drive the bus or maybe you need a different property manager! Our goal as a property manager is to make your investment truly passive. We do speak with clients on larger financial decisions (for example, any repair over $500 we call them to discuss it before we do it) but for the most part we try to leave the owners uninterrupted unless there is a reason for doing so.
When you hire a property manager you will need to let your tenants know. In the past, we have had clients not notify the tenants, to the point tenants thought we were a scam when we were explaining how to pay rent going forward. You will also want to know how you can find out the latest about your property. Is there a property manager solely responsible for your house? Is it a team of people?
This is where property owners run into some friction with property managers. How you take care of a property will not be how someone else takes care of it. Property managers are there to make sure the house/building is working properly and efficiently. That can include staying on top of smoke detectors not working, air filters needing to be changed, catching leaky faucets before it turns into an expensive water bill, etc. We do not neglect the properties and let tenants live in a nightmare. We also use qualified vendors. They aren't the most expensive but they are reliable, get the job done quickly and act professional. Paying a guy off Craigslist cash to make a repair? Yeah, we don't do that, sorry guys. I know it's cheaper. It's cheap for a reason.
Overall you will want to ask questions with your property manager to make sure you're on the same page as him or her. When it comes time to hand over the keys, it's time to sit back and let them work so you can focus your time and energy on whatever it is that makes you happy.