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 questions that you should be asking your potential proprietary management team prior to hiring them.
1.) What percentage of monthly rent do you charge?
The first question to ask when you are shopping for a property management company is what will they be charging you?
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 the monthly rent received from the tenant. This should cover services rendered including rent collections, responses to maintenance requests, and the handling of other overall property needs.
At FYVE, we offer low flat-rate rates from $79-$199 per month to a monthly fee that includes an a-la-carte menu of add-on services so you can pay for what you want and not pay for what you don’t.
2.) How do you find and screen tenants?
Property managers and the owner do not get paid unless the tenant pays rent so it is important to ensure your property manager is taking the necessary steps to find an secure a qualified tenant.
Ask the property manager to walk you through the application and move-in process for a tenant. This includes how they market your property. The application process typically includes a credit check, criminal background check, employment verification, and calling the previous landlord they listed to understand their rental history. This helps ensure that the tenant, the property manager is placing, has been consistently paying rent on time or if they have been evicted.
3.) What is Your Eviction Process?
While eviction is something that no one wants to happen, it is sometimes unavoidable so it’s best to ask your property manager what their eviction process is when a tenant does not pay their rent.
As your property management team, they should be the ones who 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 long than others to complete.
4.) What is the Process During Tenant Turnover?
No one likes a vacant property, so ask the property management company what the tenant turnover process looks like. This includes asking the cost you, as a property owner, would be responsible for covering.
For example, are you getting charged for the costs of labor when turning the property (i.e. paint refresh, carpet cleaning, drywall restoration, etc.) or are there more to the cost?
Some property management teams facilitate the entire tenant turnover internally, so when a tenant moves out of a property, the property manager can prepare the apartment for a new tenant almost immediately.
5.) What kind of experience and reputation does the property manager have?
The last question is not only one you ask the property manager but research for yourself to ensure you are picking the best property manager for your investments. Let’s break down the questions to ask to help answer this question:
- How is the communication at your property management company?
- At FYVE, we have a customer service line to help answer any questions you have about your property. We also developed an owner’s app where you can view financial statements, performance dashboard, maintenance requests, and real-time support.
- Are your property managers knowledgeable on the market they are serving?
- Your property manager should know the ins and out of the real estate and rental market they are serving. While FYVE is a nation-based company, we have local experts in each location to ensure you are getting the best support for yourself and your property’s needs.
- Check the property manager’s reviews
- Another good resource to know how well your potential property manager is doing, is to check their Google reviews.
There are many things to consider when choosing a property manager but these five questions to ask your property manager are a great way to start narrowing down your choices to find the best property manager for your investments. You want to ensure your property manager is capable of handling your properties, no matter if you are new to real estate investing or have multiple properties.