Property management knowledge and experience is very important when it comes to managing the properties that are in your portfolio. The care and attention that a property manager takes with an investment property can make a huge difference to the success of an investment property.
If a property manager is careless with the management there are several things that can happen, some of which are listed below:
1. Rents will start to accrue and will be difficult to recover, even to the point where there may have to be legal proceedings
2. Tenants damage the property
3. Maintenance is not kept up to date and over time what would have been ‘repairs’ become ‘replacements’ which is a much more expensive exercise
4. Rents are not achieving full potential because the property is not as attractive and competitive as others on the market due to it looking ‘tired’
5. There is major damage to the property and tenants are not removed promptly
So to ensure that your property will be managed properly here are some tips:
1. Research the area and find out where the good property management teams are. Speak to them and interview them to find out exactly what services they offer and what charges they make.
2. Check that they send you monthly reports on the property and three monthly inspection reports. In this day and age there is no excuse that they cannot take dated photos to send to you.
3. Tell them that you would like to inspect the property with them at least once a year so that you can personally keep updated.
4. Discuss with your property manager your purpose for owning this property as regards cash flow, costs, future goals (rehabbing or freshening up between tenants, etc) so that they know exactly how you want the property managed.
5. If you find that you cannot get the satisfaction you want from a property management team do not hesitate to finish with them. Before you do though, make sure that it has not just been poor communication that has caused the problem and one which can be fixed quite easily.
As a property investor you are in the business of property investing to make money so you do need to take responsibility of the running of it as a business. You need to treat the property manager as an extension of your business and ensure that there is good and frequent communication between both parties. Don’t do as I have heard being done, not make contact then 12 months later wonder why everything is not going as well as it should be. Insist on those reports and make sure that you are reading them and giving them the tick of approval.