Hiring the right property manager can make or break the rental investing experience.
Choosing the wrong manager can be painful and cost you thousands of dollars.
I have seen a landlord lose over $100,000 dollars because they didn’t pay attention to these 5 things when hiring a property manager…
Want to know how?
Here are the five most common ways owners and investors lose money with property management.
An essential thing to be sure of upfront is that the property manager has a buttoned-up and detailed onboarding process. It could take weeks or months to get your property ready and on the market if they don’t.
Every week your property is left vacant, and you’re losing money.
Ask the property manager how long it will take to get your property listed and on the market. Be sure they’re doing their homework and have a dialed-in system where walkthroughs and potential repairs are done quickly, so your property is on the market ASAP.
In today’s world, potential residents want quick and efficient communication. They want to be able to see the property fast.
If your property manager is missing phone calls, not responding to emails, or tenants see them as “dragging their feet,” applicants will move on. Potential tenants typically have a short timeline to find a new rental; if your property takes too long, they’ll go elsewhere.
If your house sits vacant on the market for weeks due to a poor leasing system, that’s money down the drain.
The #1 job of a property manager is to underwrite the resident.
What this means is…
✅ Thoroughly screening each tenant
✅ Checking for credit scores
✅ Background checks
✅ Verifying rental history
✅ Verifying employment and income
✅ Following local, state, and federal laws (such as the Fair Housing Act)
Here at Evernest, we understand that this step is so vital that, while most property managers hire a third party, we have our own in-house team dedicated to providing underwriting services for our clients.
Choosing the wrong tenant can cost you thousands of dollars in missed rent and/or property damage. It’s the event that most landlords worry about the most.
That’s why, if the property manager you’re considering hiring has a very poor underwriting and screening process… run!
A poor maintenance system is the quickest way for the relationship between you and your tenant to go sour…
This is what you do NOT want.
❌ Poor communication
❌ Sloppy contractors
❌ Repairs being done improperly
A resident will not stay if the maintenance is handled poorly.
That resident will only stay until their first lease is up, then leave. The cycle will continue with the next tenant, the tenant, and the next. This high turnover will create more work for you, more times when the property is vacant, and can cost you thousands and thousands of dollars.
Be sure that whoever you hire has a well-defined maintenance system with transparent communication, tracking, and documentation.
This is another easy way to sour the tenant-landlord relationship. If residents have a hard time getting ahold of someone to help, are treated rudely, or are made to feel like they’re a burden, they will not want to stay on that property. They’ll want to go rent from someone else who treats them better.
It’s important to remember that as soon as your property is rented out, the tenant becomes the asset.
You want that tenant to stay in that property for as long as possible. The way to do that is to show them they’re valuable and take good care of them. It’s very important to choose a property manager that is friendly, attentive, and helpful toward residents.
That wraps up the 5 ways the wrong property manager can cost you thousands of dollars. We hope this helps you know what to watch out for when hiring a property management company so you can avoid these costly red flags.
You can start the conversation here if you want to talk to one of our property managers or inquire about our property management services.
Spencer is the VP of Marketing at Evernest. He wakes up with Google and Facebook on his mind. Having bought and sold over 150 homes in Birmingham, Spencer gets a kick out of helping new and seasoned investors navigate the mistakes he made as an investor. Spencer is also passionate about his love for Michael Jordan and does his best to explain to the Millennials (who never saw him play live) how much better he was than LeBron. He loves to hang out with his wife, kids, and the world’s best black lab, Jett.