Panama City Commercial Real Estate

Residential Property Management Tips

Author: Jessie Cochran

I got a call the other day from a new residential property investor, owner of a single family home who was closing escrow in a few days.

The owner had been trying to sell a previous investment, but was getting no offers. In 30 days the new mortgage payment was to start and the prospect of making two mortgage payments plus dealing with a vacant property was going to be difficult.

The investors new goal was to rent/lease the property for a few years and then try to sell again. Hopefully, with a higher cap rate and rental rates which will make it more attractive to other investors.

This situation is occurring over and over again all over the city, county, state, and nation.

If you need to rent/lease one or more of your residential income properties, how do you go about obtaining professional advice and services? What should you consider as important? To assist with these and other questions, I am pleased to offer the following tips in locating a residential property manager for your residential income properties.

Tip #1: Find a residential property manager reasonably close to the location of your property. If the property manager has to drive a long distance to get to your rental unit(s) they will be less likely to rent it quickly or to inspect it.

Does it make sense for someone that is a 40 minute drive from your property to manage it? A good rule of thumb is 20 minutes travel time maximum. One exception, if the manager lives close to your property, it may be okay for their office to be in the 40 minute range (they can show it on their way to or from work).

Tip #2: Find a property manager that markets their services and themselves well. If the property management company you are considering does not sell itself well to you, how good will they be at marketing your vacant property to prospective renters? Do the materials they mail to you look professional? Does the property manager dress professionally or in jeans or shorts? How polished was their presentation to you?

Tip #3: Find a residential proprerty manager that answers the phone during working hours. Some have no provisions to handle problems while they are out of the office. What if you need an answer to your pressing question and no one is there to assist you?

Tip #4: Find a residential property manager who has an emergency phone response after working hours. How serious is the company about emergencies at your property?

Tip #5: Find a residential property manager who knows how to screen prospective renters. It is my experience that not enough time is spent discussing this between owners and managers.

The property management company should have a written policy that is given to prospects. Do you agree with the policy? Is the written policy adhered to? How are exceptions made? Does the broker review every rental contract?

Tip #6: Find a residential property manager that is not too busy. The industry rule of thumb is 75 houses managed per employee. A property manager that does their own accounting won’t be showing vacancies when rents are being posted or when reports are being generated. How do they market the vacancies during those times?

Tip #7: Find a residential property manager who has references from owners with properties like yours. A short conversation with them will reveal things like when they get their monthly proceeds, are calls returned promptly, how are the properties maintained, and how cost conscious the manager is.

Tip #8: Find a residential property manager who knows maintenance. Is there a contractor on staff or other knowledgeable maintenance staff? Are they able to give over the phone tips to complaining residents that may save a service call? Do they maintain a list of vendors that is used over and over?

This may save you money or cost you money depending on the property manager. How do they ensure they get the best price and service?

Tip #9: Don’t over emphasize the management fee. At least compare apples to apples. Make sure you discuss all costs. Management fee, rental fee, advertising costs (if free, exactly what is free and what is not), inspection costs, fees for serving notices, who keeps any late fees collected, extra charges for handling maintenance, and returned check fees.

These are all fees that you could be charged for as a part of your agreement with the property management company.

When using a residential property manager, it is imperative you ask questions and receive answers you find satisfactory. Not all residential property managers have the time, tools or desire to protect your investment.

You are in the residential real estate investment business to make money, your property manager should reflect your principles and meet the guidelines of your business model.

Contact Us

* Indicates a Required Field.

Panama City Commercial Real Estate
Keller Williams Success Realty
2110 W. 23rd Street, Suite A. Panama City Fl 32405
Direct: (850) 774-6583
Direct: (850) 774-6582
Office: (850) 392-1700
Fax: (850) 522-3967