Searching for a great property manager takes time for many real estate investors, especially for those who have recently purchased a property and converted it into a rental home or those who own property's out-of-state. Landlords need to know many important details to make a decision that works for their rental property.

When interviewing potential property management businesses, you should know what questions to ask that will give you a good idea of what the property manager offers. At Peak Residential we have many years of industry experience, so we’ve created a list of questions that you can ask potential property managers before engaging their services.

Is Your Company Insured?

A firm that’s insured is able to provide insurance coverage should an unfortunate situation involve your property. You will want to work with an insured property manager as you can always get a form of compensation when insurance is available. This will also help when managing any maintenance proceedures.

What Happens if I Pull Out of Our Contract?

Its important to understand the terms and conditions of a property management contract. In particular what happens should you look to pull out of it.

When you’re interviewing a property manager make sure you understand the term of the management contract as well as any clauses that may spring into effect should you look to end it early. 

How Do You Set a Rental Price?

Assigning the right rent is critical. If the monthly rent price is too low, you risk suffering from losses. On the other hand, if it’s too high, then it could lead to vacancies.  So, you must set the right rent rate.

It’s vital to know the significant factors that the property manager considers in coming up with the rental fee for your unit. Experienced property managers know the steps to take in determining the optimal rent charge.

What is your Rent Collection Process?

When you hire a property manager you don’t have to chase after your tenant’s rental dues. Which is the reason it’s vital to find out the method for collecting rent a property management company uses. You can then be aware of how efficient their system is and its convenience to you and your renters.

What are Your Pricing Options?

Some property managers collect a flat fee, while other charge a percentage of the income you receive. So, it’s important to determine how a property manager charges in management fees since each pricing approach has its own pros and cons that will be relative to your situation.

What is Your Lease Renewal Rate?

A low turnover rate and a high rate of renewal are two things any property investor should look out for, when considering which property management company to hire. So, if a company has a low turnover rate coupled with a high renewal rate, you can be assured they take care of their tenants.

How Many Units do you Manage and How Long are they Normally Vacant?

A property management company’s vacancy rate must be low. But not too low. Be aware of management company’s who have a vacancy rate below two weeks as these property management companies may price their units too low.

But if the vacancy time is more than a month, then the rental rate will probably be too high, or the marketing campaign isn’t effective. It could also be that the condition of your rental property isn’t generating interest from potential renters.

Additionally, communication skills are incredibly important when managing market properties and vacancy frequency and legnth are directly tied to a property managers ability to communicate.

Will I Need to Pay any Management Fee in Case my Unit is Vacant, or You’re Unable to Collect Rent?

Evaluate if companies collect a fee even when they fail to meet the obligation of collecting the rent on your behalf. Some companies are accountable with their duties and won’t ask their clients to pay them when a rental income hasn’t been collected.

Make sure to check your individual property management agreement for this critical piece of information.

What’s your Property Marketing Strategy?

Various strategies may be adapted to market your rental property effectively and different marketing techniques have their own advantages.

As the success of a specific marketing method can be observed through its results, you should pick a property manager who has solid marketing experience and is equipped with great marketing skills. 

What Is Your Understanding of the Fair Housing Laws?

The FHA protects certain classes from being discriminated against. It’s crucial then for the property manager to have in-depth knowledge of the housing laws to avoid difficult legal problems.

What is Your Tenant Screening Process?

Attracting high-quality tenants is the key to the success of your property investment, and this requires performing an extensive screening procedure. It’s important to find out the company’s criteria in tenant selection, the standards they’ve set, their process when running a background check, and the protections included in the lease agreement.

Tenant screening is one of the most critical stages of managing a rental, and you need to be aware of how a property manager handles screening tenants.

How Frequently Do You Evict a Tenant?

If a lot of tenants are evicted or moving out before the tenancy period is over, then it’s likely that the property manager’s tenant screening procedure isn't great. Leaving clients with tenant turnover and some potentially lost income.

A good property manager will have an exceptionally low eviction rate, so you should consider that before hiring a property management company.  

Bottom Line

Hiring a property manager can be among the best things you can do for your rental business. But you need to make sure the property manager offers competent services, with a low vacancy rate and little in the way of evictions. 

If you have any questions, or would like more information from one of the leading property management companies, Peak Residential, then call us today!