4 Expert Tips on How to Choose an Excellent Property Manager
Updated: Feb 8
Choosing the right investment property manager can be an overwhelming task, especially if you’re a first-time landlord. What qualifications should you be looking for?
1. Look for specialized experience
Property management is a complex industry. You want an investment property manager who is on top of current federal, state, and local laws. And you want someone who has a proven record of effectively handling the many variables that come with tenants and homes.
Questions to ask:
How long have you managed rental homes?
How many rental homes do you currently manage?
2. Verify professional licenses and certifications
In some areas, you might find people managing properties with only a real estate license, and a few states don’t require a license of any type. Competent property managers and management companies should be able to back up their technical expertise with proper licensing and professional certifications. Check with your state’s real estate commission to see if a property manager’s real estate broker's license is current.
3. Check reviews and references
It almost goes without saying these days, but before you take time to meet with a property management company, read through its Yelp and Google reviews as well as the comments on its Facebook page.
When speaking to a potential investment property manager, ask for current client and tenant references, if available.
4. Examine the property management agreement
The property management agreement outlines the business relationship between you and the property manager, and delineates the management team’s tasks and responsibilities. Given the seriousness of the contract, it’s incumbent upon you to read it carefully and make any necessary amendments before signing off. Confirm that it covers everything you want, and that there are no disagreeable clauses.
Typically, the property management agreement covers:
Services provided and fees: Typical services include resolving tenant needs and requests, maintenance of the home, marketing and filling vacancies, collecting rent, handling move-outs and evictions, and all other daily operational duties. To avoid any billing surprises down the road, all fees—as well as the process for approving any additional expenses—should be transparently outlined in the agreement. Make sure the contract stipulates how repairs are handled and expensed, including a set expense limit that you feel comfortable with.
Owner responsibilities: In addition to laying out the manager’s responsibilities, the agreement may cover your responsibilities as well. Keep in mind: If there are any tasks you don’t want to perform, discuss these and assign them to your property manager.
Contract duration and termination clauses: The agreement’s tenure should have a specific start and end date. Often, they’re signed on a one-year basis. It’s also important for the agreement to cover breach of contract rules as well as termination fees and timelines.