If you’re considering purchasing or have recently purchased an investment property in Keller, TX, one of the first things you’ll want to do is find a reputable property management company to handle the day-to-day management of your investment. But with so many options on the market, how do you know what to look for?
Questions to Ask Potential Property Management Companies
The first step to choosing a property management company is asking the right questions. Use this list to find the best property management company for your needs.
How Many Properties Are They Currently Managing?
One of the first things you’ll want to ask a potential property management partner is how many properties and/or units they’re currently managing. You’ll also want to ask them how many property managers they have on staff to manage their portfolio. That will give you an idea of how much attention they’ll be able to devote to your property.
If a company only has two property managers and is currently managing 150 units across four different properties, they’re not going to be able to give your investment the attention that it needs.
What Are Their Policies on Repairs and Maintenance?
Part of the job of a property management company is to handle the repairs and maintenance for the properties they manage. But that means different things to different companies. Before you decide on a property management company, you’ll want to know what level of repairs they have the capacity to handle.
Ask them what types of repairs their managers typically handle, and which ones they hire out to professionals. You’ll also want to know if they tackle repairs and hiring repairmen autonomously, or if they typically reach out for your approval before making those kinds of decisions.
How Often Will They Conduct Inspections?
Another critical piece of information you’ll want to get from your potential Keller property management partner is how often they’ll be on site at your investment property and how often they plan to conduct inspections on individual units. (See: How Often Should You Inspect Your Rental Properties?)
A huge problem with rental properties comes from tenant damage, which can be extremely costly for you as an owner. Regular inspections allow your property managers to catch any damage before it gets out of hand, which will save you money in the long run.
What Are Their Accounting Practices?
Obviously, you’ll need to get a solid idea of your property management company’s accounting practices before you make a decision. What’s their procedure for delivering the rent? Do they send checks or will the rent be delivered to your account via direct deposit? When can you expect the rent each month? How do they handle late rent payments?
How Do They Keep Your Vacancies to a Minimum?
Another really important thing to consider when hiring a property management company is how they’ll keep your investment property filled with tenants and limit vacancies to a minimum. Where do they advertise? Do they use signs, do they post online, do they put ads in the paper? Do they use free advertising methods, paid advertising methods, or both? How long are their average vacancies?
As a general rule of thumb, the more strategic and aggressive they are with their advertising, the less you’ll have to worry about vacant units in your investment property.
How Do They Handle Evictions?
Unfortunately, evictions are par for the course when it comes to rental properties. And while effective tenant screening will help to keep evictions to a minimum, it won’t eradicate them completely, so you’ll need to get an understanding of exactly how your potential property management partner handles the eviction process.
What are their policies and procedures for eviction? How long do they wait before they start the eviction process? What are the costs associated for you as an investor in relation to the eviction process? Those are all questions you’ll want to get an answer to.
What Are Their Fees?
This is an important one. You need to know how much their services cost and what additional fees you might accrue during the relationship. If a property management company is too expensive, it could eat into your cash flow and affect the profitability of your investment.
However, if a property company is so inexpensive that it seems too good to be true, it probably is. Ideally, you want to work with a company that’s affordable, but remember that you should expect to pay a certain price for quality.
The Biggest Mistakes Investors Make When Choosing A Property Manager
Not quizzing a property manager on their experience is just the tip of iceberg. Here are three mistakes investors make when choosing a DFW property manager.
1. Not asking the size of the team.
There’s no way one or two people can be effective managing many properties. Property managers who are stretched too thin are overworked and unresponsive, and that’s not the type of manager you want to work with.
Along with asking about team size, you should find out if a manager’s main source of income is from property management. When you have one person (or real estate agent) running your property as a side job, they won’t have the time or manpower to manage your investment the way it needs to be done.
2. Not asking about the tenant screening process.
Never forget to question how a property manager vets applicants. You put a lot of faith in your tenants to pay rent on time, refrain from illegal activity, and keep your property in good condition. You need to make sure the person you hand over keys to has gone through a thorough criminal and credit check.
It’s also important to avoid managers who will throw anyone into a property to fill a vacancy. You can bring up your tenant screening concerns with these types of questions:
- What action do you take to find upstanding tenants at crunch time?
- Will you make screening sacrifices to occupy a rental?
- What software systems do you use to screen?
- What criteria do you use to qualify applicants?
3. Not asking about the software they use.
Software improves a rental experience by leaps and bounds for both the renter and landlord. At the very least, your property manager should have a software system that takes online payments. They should also accept many forms of payment i.e. credit cards, cashier checks, e-checks or bank drafts.
Because there are so many factors to consider when hiring property management in Keller, TX, you’ll really want to do your due diligence and make sure that your potential property management partner is in alignment with your ultimate goals and can deliver the kind of service you’re looking for.
If you need help finding an experienced property management company, reach out to us for a free consultation.