If you go to Google and type in “property management”, you will quickly be bombarded by thousands of companies that claim to be the best. So how do you figure out which one is right for you?
There isn’t a one-size-fits-all solution when it comes to property management. Each property and each person will have different needs. But that doesn’t mean there aren’t some universal principles for choosing the one that’s right for you. We have put together some things to keep in mind as you make up your mind.
TRUST YOUR GUT
Ok, so let’s be honest. You probably don’t need someone to tell you to trust your gut. But all too often we start doubting our first impressions and overthinking our decisions. Our intuition isn’t everything, but it’s an important tool in finding business partners that we will work well with.
Investment properties are a huge investment, so you want to know they are being managed by someone that you trust. Even more, you want to know that your manager is actually someone you enjoy working with. For most of us that means someone that reminds us a little bit of ourselves, but with the time and experience to take care of your properties in ways you can’t.
One of the reasons there isn’t one perfect property manager for everyone is that we all have a different idea about who we WANT to work with. Don’t stop here, your instincts aren’t everything. But when you are talking about entrusting an investment worth thousands or even millions of dollars to someone you barely know, then trusting your gut is a good first step.
CHOOSE SOMEONE THAT KNOWS YOUR NICHE
There is a nearly endless variety of property markets and niches. What works in New York may not work in San Diego. The company that manages a giant shopping mall may not be the right company to tend to your bungalow on the beach. You want to find a management company with lots of experience managing properties just like yours.
This will almost always mean starting with a locally based company. It doesn’t matter if they manage 50 properties or 5,000 properties — you want someone that focuses on one area. Real estate markets change drastically from state to state and even city to city. Our company focuses on a few select neighborhoods within San Diego, and in most cases, we won’t even accept clients outside of them for this reason. Choosing someone that knows your area will help make sure your properties are being listed for the right prices, marketed to the right people, and taken care of the right way.
Even if a company knows your area, they may not understand what makes your property unique. This can be especially important if your property is in a particularly unique niche such as a retirement home or luxury beachfront home. When you are getting started, it’s always a good idea to check out the other properties a company manages, and see how they compare to yours.
OPT FOR THE COMPANY WITH CLEAR, AND SIMPLE FEES
We would like to say choosing the company with the lowest fees is always best, but we know that isn’t the case. A discount company may save you money in the short-term, but it’s possible there is a good reason their prices are so low, and you may pay for it in the long run. Instead, we think it’s really important that the fees are clear and predictable so that your investments are stable.
Watch out for companies that advertise low management fees, but add on extra charges for leasing, renewals, etc. We have added up some of the fees these companies average, and they can more than double the actual amount you will owe. If your property is in a high rent area like San Diego where we are located, this can mean thousands of dollars in extra fees.
Keep in mind, no matter who you choose, there will always be extra costs. Maintenance, remodeling, and legal fees are usually all things that will be your responsibility. But why add on to these things with unnecessary charges for things the company should be doing anyway? You want to see steady profits from month to month, so we suggest choosing a company with one, fully inclusive fee.
In any industry, referrals are one of the most valuable tools to make your decision. Online reviews can be helpful, but they can also be deceptive. Hiring a company with flashy marketing may feel nice, but doesn’t promise you will find a company that is actually good at managing properties.
In the last several years, there has been a huge influx of fake reviews posted online, making it nearly impossible to sort through what is true and what is false. Moreover, in property management, if you read through online reviews, you will also quickly find that most reviews are from tenants, and not from other property owners. Reading comments can give you valuable information about the company that’s hard to find other places, but resist the urge to start counting stars.
Instead, try to get in contact with people that you can talk to in person or on the phone. Even if you don’t know anyone using a property manager yourself, you can ask companies to send you referrals of their own. Don’t just ask if they like the company or not, because they will obviously just send you the best referrals. But if you plan out some questions specific to your property, you can get a great window into how well they will fit your needs.
MAKE SURE THEY UNDERSTAND THE NUMBERS
It’s not hard to find a company that can find renters on Craigslist and fill out tenant forms. But finding a company that understands how to maximize your property value is a whole different story.
One of the things you are paying money for is a real estate expert that knows how to make you money. A good property manager will be to there advise you on how to maintain or modify your property to get the highest return year after year. There isn’t a simple formula that can do this for you, so make sure your property manager can. When you are interviewing a company to find out if they are a good fit, prepare lots of questions that will help you understand how they will protect and grow your investment.
Choosing a property manager may seem like a daunting task, but if you understand which things to look for, it’s really not so bad. Remember, no two properties are the same, so make sure you find someone that meets the needs you have.
Take it slow and do your research, and we are confident you will find someone that is trustworthy, transparent, and that you will just enjoy doing business with.
Still Looking For More Info?
Call us today at (858) 274-3500 or fill out the form below to set up a free rental consultation.