Finding The Right Property Management Company


iStock_000016508893XSmallFinding the right property manager is a big decision that will have a massive impact on the success (or lack thereof) of your rental business.

After all – these people are going to be your eyes and ears and hands and feet. Their actions will have a huge influence on whether you have a profitable and efficient operation or a sluggish and failing business.

In my conversations and experience with the property managers in my market, I've found that some of them are EXPERTS who are very good at what they do, and others are total amateurs…    the kinds of people you should be afraid to do business with.

How To Interview A Property Manager

When I first got into the business of rental properties, one of my colleagues (who owns several rental properties out-of-state) shared a system with me that she developed for the purpose of finding and screening property management companies. It's a series of informative questions that reveal how capable and competent a management company actually is, and how effective they are likely to be at managing your particular property.

I used these exact questions to find my current property manager and I have to be honest, they worked like a charm. I was able to get a thorough understanding of who I was dealing with before I put them in the driver's seat. As a result of walking into this relationship fully informed, I couldn't be happier with the results.

If you're looking for a property manager and you don't know where to start, I'd suggest contacting a few of them and asking the following questions…

General Background:

1. What types of properties do you manage? (single family homes, apartments, commercial, etc.)

2. How many units does your company currently manage?

3. How long have you been in the property management business?

4. How many rental properties do you own personally?

Regarding The Property You Intend To Purchase:

5. What areas of town would you consider to be good rental markets with a low vacancy rate?

6. If you were investing your own money into a rental property right now, what areas/neighborhoods would you be focusing on and what types of properties would you go for? Why?

7. (If you have a specific property nailed down) What is the average vacancy rate in this area?

8. Is there anything unique or special about this area? Are things getting better or worse? Does this strike you as a good investment property?

Management Related:

9. How many people do you have on staff? How much of your work is contracted out?

10. Describe how your company’s work is divided up between people and/or what is the number of units that each person manages?

11. Describe your tenant screening process.

12. Describe your eviction process from the first-day rent is late.

13. What do you define as the “tenant’s responsibilities” in your standard lease agreement (cleaning, furnace filters, yard care, etc.)?

14. What limit do you set for your property owners to approve expenditures?

15. Will the repairs and maintenance for each property be paid at cost or cost-plus?

16. Are there any ways you'll be able to improve my profits (e.g. – increase rent without losing tenants, share late fees, etc.)?

17. Describe your fee structure and what is included or excluded (advertising, leasing fees, etc.).

18. Is it possible for me to see a copy of your paperwork/reports/lease agreements? (note: if you get any push-back or resistance on this question – don't worry about it)

19. Can you give me 3 references?

Other Considerations

20. What kind of accounting statements will you provide me with for my properties?

21. How will you deposit each month’s rent into my account (direct deposit, check, etc.)?

22. Are you licensed to be a property manager?

23. Do you use contractors who carry their own liability and workman’s comp insurance?

24. How frequently will you be visiting my tenants and properties?

Depending on how many properties you own and what kinds of properties you're in the process of purchasing, you could expand even further on these questions – but in most situations, the information that comes out of this brief discussion will give you some very strong indicators as to whether or not you're talking to a competent property manager.

Note: If you're looking for an even more extensive list of questions to consider when looking for a new property manager, check out this blog post from Active Renter, which leaves no stone unturned.

Property Management Agreement

Some other things you’ll want to be wary of are the terms outlined in the Property Management Agreement. This is a contract between you and your property management company that lays out:

  • What THEIR responsibilities are.
  • What YOUR responsibilities are.
  • The level of authority you are giving them to manage and control your property.

In the agreement that I signed with my property manager, it states that they are authorized (by me) to market the property, screen and choose my tenants, pay for incidental expenses as they come up (up to a specified dollar amount) among other things. This is a very important document because it details exactly what the terms of your relationship will be, and what both parties can expect from each other.

Before you sign on the dotted line, I strongly recommend that you take the time to read through this contract and understand exactly what you are getting into. If you're dealing with a reputable management company, there shouldn't be any surprises baked into it, but more important than finding problems is simply ensuring that you understand the dynamics of what this relationship will look like. If any questions arise, you can address them upfront rather than trying to work out the kinks after you've given them the keys to your property.

About the author

Seth Williams is a land investor and residential income property owner, with hundreds of closed transactions and nearly a decade of experience in the commercial real estate banking industry. He is also the Founder of REtipster.com - a real estate investing blog that offers real world guidance for part-time real estate investors.

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  1. property managers says:

    Hi, I do believe this is a great website. I stumbledupon it 😉 I may come
    back once again since I bookmarked it. Money and freedom is the greatest
    way to change, may you be rich and continue to guide other
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  2. Jeff Curtis says:

    I agree with the importance of finding the right property management company. I find it interesting that a good background question to ask would be how many units their company currently manages. For what purpose would you want a company that has a lot of clients? Why would you want one that has fewer clients?

    1. Seth Williams says:

      Hi Jeff – I think it’s a good question to ask from the standpoint of understanding the property manager’s experience. It’s also a good indication as to whether they have good systems in place (because if a PM has a huge number of units, there’s usually not a good way to do this without streamlining things).

      Does that make sense?

    2. Wesley Colberth says:

      Jeff, I too thought it was quite interesting that background questions can be very helpful in determining the quality of the serve. I thought that some of the questions were quite useful like, “Why would you want one that has fewer clients?”. Overall, this article was quite helpful.

  3. Hazel Adams says:

    It is interesting for me to learn a little bit about how to find the right property. I did not realize that there were so many things that go into making that decision. I am excited to find the company that works best for me.

    1. Seth Williams says:

      Thanks for sharing Hazel! Best of luck in your search!

  4. James Bergman says:

    You should definitely know what your responsibilities will be and what the property managers responsibilities are. I would probably ask them right off what they would expect me to be responsible for. This way I can know if I want to use them or not right up front.

  5. Vivian says:

    All data added here were relevant and wise, will surely be recommending info to my connections.

    1. Seth Williams says:

      Thanks Vivian!

  6. Annie Frances says:

    I like your suggested questions to ask a property management company about the property I want to purchase. I’m looking to buy a commercial space and rent it out to businesses. Hence, knowing the vacancy rate is a good thing for me. I’ll be sure to ask the property management company. Great post, thanks!

    1. Seth Williams says:

      Good thinking Annie. Thanks for the comment!

  7. Nitu Sidhu says:

    Great post, having these questions are definitely helpful for landlords to be able to screen through for a quality property management company.

    1. Seth Williams says:

      Thanks Nitu! Glad you enjoyed it.

  8. Justin Knox says:

    Thanks for the help. My dad has decided to look for a property management service and I am trying to help him look. I definitely like the idea of knowing about the background, as you suggested. How many rental properties do you think that I should expect them to take care of already?

    1. Seth Williams says:

      Hi Justin, good question. It probably depends on how big their management portfolio already is. If they’re already managing hundreds, they should have the infrastructure in place to handle a lot of new business. If however, they’re only managing a few, they may have a difficult time taking on a dozen new properties overnight.

  9. Dean Cole says:

    Great information for finding a suitable property management company. Exactly what we want our clients to think about and ask when inquiring with us!

    1. Seth Williams says:

      Thanks Dean! Glad this resonated with you too. 🙂

  10. phil rakusen says:

    Great article thank you for the advice, found it really helpful. Keep up the good work

    1. Seth Williams says:

      Thanks Phil, glad to hear it!

  11. Portiqo says:

    These are some great tips that one should take into consideration when they want to select a property management company. making sure that you select the right company that specializes in your type of property will ensure that you have no issues in the future.

    1. Seth Williams says:

      Thanks for sharing Portiqo! Totally agree!

  12. Lisa says:

    Some great points to consider in your well written article Seth and I would agree that we all need to get this right first time. Property Mgt Companies range from cowboys just interested in getting paid, to those who actually care about the client and want to build a great relationship with you. Unfortunately the later are few and far between but they do exist and when you interview, probably many candidates, be tough, be serious and weed out any that are not super professional. Ask to speak with existing clients, talk to them, ask them about their experiences especially when things go wrong and in the end you will find that Business who share the same values as you. Not an easy process bu doable.

    1. Seth Williams says:

      This is so true Lisa – I was just talking with someone else about this earlier today. There are SO many mediocre (and bad) property managers, but the ones who are good are worth their weight in gold (and unfortunately, they’re harder to come by). Thanks for sharing your thoughts!

  13. Richard Mews says:

    Very informative article Seth. Really good questions that any new or experienced landlord should ask themselves. And the note about doing due diligence on management contract is so true.

    1. Seth Williams says:

      Thanks for the comment Richard! I’m glad you found it informative and spot on. 🙂

  14. John says:

    I think the article listed some really helpful questions to take into consideration when looking for a property manager. I think it makes a good point how it says that asking these questions will help you understand how competent a manager really is. Since owning properties implies a significant investment on your part, I can see why it would be extremely important to do you due diligence in the hiring process to find a manager that will provide the best service to you and the tenants on your property.

  15. Kyle Winters says:

    I definitely agree with the article’s eleventh question about tenants. After all, one of the major reasons people hire property management companies is to fill their vacant apartments and homes. Since this is usually the case, you’d definitely want to know how they plan to choose the people that will be living on your property.

    1. Seth Williams says:

      Thanks for sharing your thoughts Kyle! I’m glad that question resonated well with you.

  16. Annika Larson says:

    Right now my husband and I are looking to hire a property manager to help us with a home we are renting. We want to make sure they are reliable and will treat the tenants well. As you said, it’s a good idea to ask how frequently they will be visiting the tenants and properties. Thanks for sharing!

    1. Seth Williams says:

      You’re welcome Annika! Thanks for the comment! Best of luck with finding the right PM. 🙂

  17. Marcus Coons says:

    It really helped when you mentioned the importance of asking a property manager about the types of properties they deal with. I can see that doing this can help you find a company that knows how to take care of buildings like yours and can accommodate your needs and your tenants. As I see it, taking the time to compare several companies and read online reviews can help you know what tenants and owners think about their services and choose the management firm that has the best reputation in your area.

    1. Seth Williams says:

      I’m glad that question resonated with you Marcus! Thanks for reading and commenting. 🙂

  18. Ridley Fitzgerald says:

    These are helpful tips for finding a property manager. I like how you said that they are your eyes, ears, hands and feet at the property; that’s a lot of important stuff. We’re thinking of renting out our second home, so we’ll be sure to find the best manager we can.

    1. Seth Williams says:

      I’m glad it helped Ridley. Best of luck if you end up renting out your second home!

  19. Heather says:

    You should always come prepared with the right questions in order to get the best picture of a property management company and its properties. This is a big decision to make, so it shouldn’t be taken lightly. Thanks for sharing!

    1. Seth Williams says:

      I agree. Thanks for sharing your thoughts Heather!

  20. Jaynie Baker says:

    Great Job Williams, Questionnaire is fabulous, seems in am reading a question paper for property managers, will definitely help someone who is hiring a property manager for the first time or had previous bad experience.

    1. Seth Williams says:

      Thanks Jaynie! I’m glad you thought it was great!

  21. Joe Bailey says:

    Hey Seth,

    Great article, highly recommendable! You are really thorough with this article, including direct questions you should think about before hiring a property manager and that can often be overlooked. I know from personal experience how challenging it can be! Look forward to reading more Seth.

    1. Seth Williams says:

      Thanks for stopping by and checking out this blog post Joe! I’m glad you enjoyed it!

  22. Persephone de Vito says:

    What I really liked the most was when you mentioned that prior to hiring the property manager, it’s best to ask them about the types of properties they manage and how long have they been in the managing business. I’m not exactly the one in need of a property manager, it was my brother. He has recently started his own apartment rental business, and since he doesn’t how to handle the job very much, he decided he needs professional help. Thnks for sharing.

    1. Seth Williams says:

      Thanks for sharing your thoughts Persephone – I’m glad this stuff resonated with you!

  23. Ashley Turns says:

    I like your tip to ask the property manager you are considering questions like how long they have been in business and how many people they employ. My husband and I have just bought a new rental house and we are trying to find the best company to help us take care of it. We will definitely have to sit down with a few property managers so we can get a feel for their business and how much experience they have.

  24. It’s great that you elaborated on reading through the contract before signing. This is great advice for just about everything that has to do with signing a contract but arguably most important in this instance. I am sure that my aunt who has been researching property management would like knowing this.

    1. Thanks for sharing your thoughts Alexandria! I agree – knowing what the contract says is critical.

  25. I agree that you would want to consider how many people a rental management company has on staff. Finding this out would also tell you about how experienced they are. I’m looking for a rental property manager, so I’ll have to consider how many people they have on staff.

  26. I agree that you would want to consider what type of property a manager has worked with in the past. It would be smart to get this kind of experience because it would help ensure that they are qualified. I’m looking for a property manager to help manage my beach home, so I’ll have to check their experience first.

  27. Jay says:

    Confirming responsibilities with each other is really vital for success. I actually almost forgot that, so thank you! I also wanted to add that, when both parties know what the other is responsible for, then you can start helping each other out. I think that is especially true for property management!

  28. Thanks for the advice about asking a property manager how long they have been in the business. It would be good to consider their experience because this would affect how many connections in the industry they have. My husband and I are looking for a property manager, so we’ll have to consider how long they have been around.

  29. Thanks for the tip about finding out about what kind of properties a manager usually manages. It would be smart to consider this because it would show that they are qualified and experienced enough to help you out. My husband and I are looking for a property manager, so we’ll have to consider what they usually manage.

  30. I appreciate the advice about asking a property manager how many units they currently manage. Finding out how much work they already have would help you know if they will have the time for your unit. My husband and I want to hire someone to manage our lakehouse, so we’ll have to consider how many units they currently work with.

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