How to Interview a Property Management Company (Questions #3 and #4)

This week we continue with our suggested list of questions to ask while interviewing property management company candidates for your property. The original blog post can be found here: How to Interview and Hire the Right Property Management Company for Your Apartment Building

We have put together a list of 12 questions to consider asking during the interview process with PM companies – questions #3 and #4 are below:

Property Management Company Interview Question #3

What is the term of the contracts between the property management firm and its’ clients? Are there any early termination penalties or fees? What type of notice must be given in order to dissolve the relationship?

In the event that the contractual relationship with the property manager does not work out, it is best to know up front what exactly it will take to walk away from the agreement. Remember: as with all contracts, everything is absolutely negotiable. If the termination clause is unreasonable, let the property management company know and try to settle upon terms that are agreeable to both parties.

Property Management Company Interview Question #4

Does the property management firm have its’ own in-house maintenance crew? Or does it contract out all maintenance and repairs?

If the maintenance crew is in-house, what does the property management company charge per hour for repairs? Does it mark-up materials?

If the maintenance is contracted out, does the property management company mark-up the invoices from the contractors or charge any type of fee? How are the outsourced contractors screened and selected?

The purpose of this line of questioning is to ensure that any hidden or embedded maintenance costs are disclosed from the beginning so that there are no surprises when the first monthly statement arrives. Furthermore, if the property managers are hiring third party vendors to service and maintain the investment property, it is advisable to find out if licensed, bonded and insured contractors are being hired.

Have a great week,

Trevor

Property Management Interview Questions #1 and #2

http://www.bennettpropertymanagement.com.au/ Property Management Program

Wonderful blog! I
truly love how it’s easy on my eyes as well as the info are well written. I am
wondering how I may be notified whenever a new post has been made. I have
subscribed to your rss feed which need to do the trick! Have a nice day!
Julie Cruz

Great information here Trevor… Here is a post that you may be interested in… http://tenantscreener.info/?p=8&utm_source=rss&utm_medium=rss&utm_campaign=why-landlords-background-check-what-are-they-looking-for

this blog is hit or miss… I like this post…

Julie
- http://www.firstlightpropertymanagement.com/blog Trevor Henson
  
  Hi Julie,
  
  Thanks for taking the time to stop by and share the link to the tenant screening blog. Careful screening of incoming tenant-prospects is one of the most important responsibilities that a property management company takes on and owners who are looking for a new manager should verify that manager’s screening approach before contracting. _Trevor
www.ajbuildingandgrounds.com

Great tips for owners/investors Trevor. You are hitting on some key points many owners/investors overlook. You mentioned licensing of third party contractors. I’m not sure how it works in your location but in Illinois there are certain restrictions on who performs leasing activities. If the management company contracts a building engineer or janitor to show units and fill out leasing applications on behalf of their client, they must hold a leasing license. I’ve seen a few management companies get fined but I don’t know what the trickle down effect would be on the owner/investor.
- http://www.firstlightpropertymanagement.com/blog Trevor Henson
  
  Thanks for the feedback! In California, the laws in regards leasing sound very similar to that of Illinois: a contractor must have a real estate license in order to advertise, negotiate and sign leases. The outsourcing of property management work to third party vendors that was mentioned in the article strictly refers to repair, renovation, and maintenance activities. Have a great weekend! _Trevor
Homeowner24

Most
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At Florida Estate Management 80% of our services are in house so we are
substantially more affordable and offer a quality controlled product
without marking up invoices. In most cases we can save our clients 10 to
20% on their monthly maintenance bills. (561.721.9537) http://www.FloridaHomeWatch.com