If you’re new to real estate, you know there’s much to learn about the business—especially if you’re looking to rent out your property. To lighten the burden, you might consider hiring an individual or third-party company to help you manage your rental units. However, you’ll want to be exceptionally careful and considerate with your decision, as this person will be a reflection on you to your tenants.
If you’ve never hired a property manager before, you might not know the right qualities to look for. To help you make a smart decision, 12 members of Forbes Real Estate Council, below, discuss some key traits a good property manager should have. Here’s what they said:
Members share a few traits to look for when selecting a property manager.
Photos courtesy of the individual members
1. Trustworthiness
First, ask yourself if you would trust that person to stay in or rent your home. Trust is often overlooked in business and I believe it should be the foremost thing we look for. – Joshua Fraser, Estated
2. Experience With Your Type Of Property
Hire a professional who has experience with the type of property you acquired. Commercial properties and tenants have different nuances than residential. Even retail will have different issues than an office. An individual with experience will be able to identify value-add opportunities and help increase your NOI due to their knowledge of rent and expense benchmarks for this type of property. – Catherine Kuo, Elite Homes | Christie’s International Real Estate
3. Financial And Accounting Acumen
It is now common in many commercial real estate companies to completely separate accounting and property management responsibilities. Unfortunately, this means there is a large pool of professionals with little to no understanding of financial statements and accounting. Investors should carefully interview potential companies and, if needed, engage the assistance of their CPA in selecting a firm. – Bethany Babcock, Foresite Commercial Real Estate
4. Their Tenant Screening Process
The best property managers are ones who screen tenants by conducting background, credit and reference checks. It’s important to find property managers who are professional, reputable and well-established to keep both the landlord and tenants happy. – Beatrice de Jong, Open Listings (YC W15)
5. Their Turnover Rates And Cost Of Vacancy
Investors often focus on the PM fee. Instead, focus on the turnover process. If your rent is $1,000 and PM is 10%, you pay $100 per month. At 9%, you only save $10 per month. Consider the cost of vacancy. The same unit cost $30 in lost income per day when vacant. “Become” a tenant, schedule a showing and see what this process looks like. If it is cumbersome for you, it will be for your customer. – Timothy VandenToorn, United Properties of West Michigan
6. Their Technology Stack
More property managers than ever before are using technology. But look for the company or individual that offers a full stack of service integrated with technology. You want a property manager who knows how to leverage the data about your property to make precise and proactive recommendations. Plus, if they’ve integrated on-site services, they’ll execute to maintain and protect your investment. – Chuck Hattemer, Onerent
7. Local Knowledge
Despite advances in technology, only so much can be done behind a computer screen. It is important the company or person you select to look after a property has “boots on the ground” and can check on the property in-person. Even better if someone can regularly drive or stop by, as this could catch any issues with the building or community before they become problems. – Joshua Lybolt, Lifstyl Real Estate
8. Ability To Communicate
Pretty much everything other than communication skills is either math, law or logistics which can all be taught and learned, but communication or people skills is the number one thing I look for in anyone representing my interest in a business or property. – Frank Deluca, DCL Healthcare Properties Inc.
9. Billing Transparency
On top of a rate to manage an apartment building, it is important to know the company’s policies for other charges including maintenance, leasing and other activities. Do they send you the bill directly or do they mark up maintenance or other orders? Do they take a fee or percentage for leasing units? Understanding upfront how they charge will alleviate common misunderstandings later. – Lee Kiser, Kiser Group
10. Availability And Responsiveness
Want to be awoken at 2 a.m. by a tenant claiming their toilet is broken? This is why you hire a property manager. Hire a PM that has systems in place to answer and handle calls 24/7. Is the PM answering your calls quickly? You need a PM that dedicates their time to making sure your tenants are happy and your property is being cared for, saving you precious time and preserving your investment. – Angela Yaun, Day Realty Group
11. Values Cost-Effectiveness
There are uncontrollable costs like insurance, mortgage payment and taxes. Then there are controllable costs like turn times, marketing and maintenance or upkeep. So instead of mowing the lawn less frequently, thus affecting your tenant happiness and retention, find a more cost-effective vendor. It is not about eliminating the cost but controlling the cost. PMs who get this win. – Noel Christopher, Renters Warehouse
12. A Long-Term Mindset
Make sure they have a long-term mindset because real estate is a long-term play, not a one night stand. It’s a marriage. So make sure to surround yourself with individuals, agents, property managers and accountants that all have the same mindset as you. Make sure they have your best interest at heart and want to help you accomplish your goals. – Engelo Rumora, List’n Sell Realty