When hiring a property management company, it’s crucial that you ask the proper questions to determine whether or not they’re the right fit. While our team at FYVE volunteers as much information as we can during initial conversations, other companies may wait for you to ask the questions instead. That’s why we’re here to offer you five of the most important things that you should be asking your potential proprietary management team prior to hiring them.
1.) How Do You Screen Tenants?
It may seem obvious; but ask them to take you through how they screen tenants. If they’re like most property management teams, they’ll more than likely do a credit check, criminal background check, verify employment and call previous landlords listed as references., This helps to ensure rent was consistently paid on time or discover if the applicant has ever been evicted.
2.) What Percentage of Monthly Rent Do You Charge?
The second question you should ask them is what percentage of monthly rent they charge. With industry standard being between 8 and 12%; you may find you fall around that 10% mark, meaning you’ll pay your property management team 10% of monthly rent. This should cover services rendered including rent collection, response to maintenance requests and the handling of other overall property needs.
3.) What is Your Eviction Process?
Be sure to ask what happens before, during and after a tenant is evicted. While this isn’t something you want to happen, it something you need to be prepared for which is why it’s important you understand the process in place to handle it. As your property management team, they should be the ones ready to file paperwork as well as show up for any court dates if necessary. It also helps to know if you’re renting in a landlord-friendly city and how long the overall eviction process takes as some states take longer than others to complete.
4.) What is the Process During Tenant Turnover?
When discussing tenant turnover, find out how long the entire process takes and what you should expect to spend. It’s important to know what costs you’ll be responsible for covering. i.e. are you only charged for cost of labor when performing services such as paint refresh, carpet cleaning, drywall restoration etc.) Some property management teams facilitate everything internally, so when a resident moves out, they can prepare the apartment for a new tenant almost immediately.
5.) What is the city vacancy rate?
The last question you should consider asking is the city’s vacancy rate, as it can be a helpful indicator as to how quickly you’ll be able to secure tenants. If you don’t live in the area where your property’s listed, you may be unaware of rates that are higher than you expected. If this is the case, it might be an indication that you shouldn’t be buying in that location.
So, there you have it! The five most important questions you should be asking your management team before working with them. With these considerations, you can prepare yourself for a successful partnership with a team that’s ready to prioritize all of your property management needs.