Questions for Property Management

I'm about to call/interview a few real estate agents to be the PM of IP. IP is a house in a slightly 'dodgy' area in VIC.

Anyone got suggestions on useful things to ask to gauge competency or commitment ? Or things you wish you knew before engaing the PM ?
This is aside from the standard questions on fees, inspections, experience, what their service includes etc

for example one of the real estate agents boast on profile they manage over 130 properties. To me that seems like a lot (if its true), could mean they won't have so much time and energy to put towards each property.

 

If they only manage 130 properties they're pretty quiet IMHO. One PM should handle 75-100 residential properties. So you should find out how big/support their property manager has eg - trust accountant, administrator etc.

 

There are so many questions you could ask about their operations, staff and ethics but a few highlights of the things that I would ask are below.

- What rental management software do you use? I personally would not use an agency who use excel spreadsheets as there is too much margin for human error.
- Do they have a landlord online portal where you can view all trust account receipts and maintenance requests?
- How often do they transfer trust account money to you? How long you have to wait to receive your rent will affect your cash flow.
- How often do you do inspections?
- How experienced are your agents? And in the same vein, what is the average tenure of your staff? You want an agency with experienced staff and low turnover if possible.

 

I've seen a few mentions on here of some experienced landlords with stringent vetting procedures for hiring a property manager. I wonder perhaps is some of them would have some thoughts to share on their process?

 

Search for Agents pretty good list there

 

Excel software in this day and age !!!! and as for asking their turnover in staff, do you really think they are going to discuss their business with you?

Seems to me that a lot of landlords expect from their PM the emotional attachment they have to their IP, -as long as the PM does his/her job well that's all you should expect.

 

It has it's place but does not meet the requirements of the PSBA Act for trust accounting. Nor does Zero, Quicken or Quickbooks etc. Most will use Console or other cloud based Real Estate specific software.

 

Excel prob not allowed.

But asking about staff turnover or how long staff have been there is a very fair thing, I can tell you staff turnover is a pain and provides a hint.

 

Also, if a business wants your business, but won't discuss normal aspects of the business, or can't provide good answers or looks at you as if to say that is none of your business, then I suggest moving on.

Also many may answer the questions and be lying, so this whole thing about having a discussion about various parts of the business that are relevant, is to get a feel for how you may be treated, how tenants may be treated etc etc....

I have one PM I should change, owner is a hard nut and poor attitude from day 1, some of the other staff also have same attitude now & the one that was really good at the job and had a good attitude has left, now while the staff turnover has been low, this also tells a story, and even over a year later, they have kept it quiet that this good PM staff member has moved on.

At the end of the day, if a business does not see it's fee paying customers as important & that they should do a good a job as they can to look out for the interests of those paying, then move on till you have someone you feel is like this. A PM should always talk to you as the paying customer and put your asset and concerns first if you are complying with the rules and reasonable requests.

If a PM is sloppy, only worries about the money they get, does not inform of issues or problems, then tries to offload that as somehow the owners fault, boot them straight away, provided it was not you who ignored all the requests and warnings.

 

A new one Ive been paying atttention too / keeping an eye on is google reviews (because you have to go to the effort of having a google accout before writing a review) and facebook thumbs up / thumbs down pages for the area. People have no issues in writing bad reviews (though some will not be relevant- applicants upset because they were unsuccessful, or tenants complaing an evil agent took some bont for cleaning), can give you some insight. Good reviews are even betterm as they are harder to get!

 

I personally think 130 properties per property manager is far too many to do an effective job, my agency limits to half that number so we can provide a superior service.

If it is in a dodgy area, you dont want to skint on your property manager as a good one will really earn their fee, and a bad one can cost you thousands! A lot of owners will shop on management fee %, then complain when things go wrong. It takes a lot of time and effort to do property management properly and it is not an easy job. So don't go too cheap.

If you are local to the area, it would be worth meeting with a few property managers and getting a feel for them. Ask them what they do when they get a new tenancy - you will find that different agencies have different processes - some better than others. How many properties they manage is important. Ask them about their process for chasing arrears. Also ask them about their schedule for inspections. If you cant meet them fact to face, maybe Skype?

If you are local, or get to that area of the world from time to time, it is probably worth you going along for the occassional inspection so you can see for yourself how the tenant is treating the property, you can also notice if there are any random maintenence things you might need to take care of (like trees overgrowing your gutters etc.. - many property managers simply don't notice that kind of thing unfortunately).

 

I 100% agree with most of your post- but I just wanted to question your agency only having 65 managements per Property Manager? Unless the area has a very high rent, there's no way that's sustainable.

I believe it should be about 120 per Property Manager in a well maintained portfolio, but as low as 80 if there's problems that need ironing out or the staff member is settling in. Some people think PM's should be managing up to 250, but I agree this is ludicrous.

 

So far, we have kept overheads low and seem to be managing, we do charge 8.5% management fees which is not as expensive as some, but more expensive than others. But I feel our service quality really does justify the fee. Having a lower number of properties means our owners and tenants are treated as 'people' not a 'number'. They get a personalised service which is superior to most agencies out there, we respond to maintenance quickly, and can give open homes a proper half hour to an hour rather than the 10 minutes many agencies seem to provide. Our properties are currently all around the CBD and inner city areas, so yes, the rent is a little higher than perhaps the average.

 

interesting information. Thanks!

 

That is exactly what i would recommend doing looking at reviews! Every agent will always tell you want they will do for you, reviews show either way how others have experienced their services.

 

The problem with reviews, is a lot of people have no clue to start with, so they may be raving on, for or against with no real standing to say.....

I will go and have a look, but most reviews I see have been ones agents choose when someone has been asked to write something it seems, not only that, they rave on about how nice the person is.......people like me are not looking for friends or nice people, were looking for efficient managers.......

Anyway, how does one find google only reviews on an agent or PM etc, I seem to only get spammed by agent finder or sites pushing agents....

 

You need to be in google (use google chrome for example) google the relevant agent and if they have google Reviews they will show up. No need to google ‘review’ just the company name. Doesn’t work if your using another search engine as yahoo for example want you to use their review system.