As a landlord, before you turn your property over to a management company, there are several questions you should ask.
1. Are you aggressive with marketing? You want revenue coming into the property as soon as possible, and the best way to make that happen is to advertise it aggressively once it’s on the market. Your property manager should place it on several high profile rental websites, use yard signs and get it on the Multiple Listing Service (MLS) so any Realtors helping their clients find a rental home can see it. Make sure your property manager networks with business and community leaders and has an excellent reputation.
2. Do you do property inspections? A mistake a lot of people make, including property managers, is turning over the property’s keys to a new tenant and thinking everything is fine, then finding out everything is not fine when the tenant moves out. The last thing you want is to be surprised by two or three thousands of dollars in damages. The security deposit will get used up quickly in a situation like this. Nothing affects your cash flow more than finding unnecessary repair work. Find out what a property management company’s inspection policy is. At Sarasota Management and Leasing, we do a videotaped inspection before the tenant moves in and then we make an appointment three month into the lease term to check for any maintenance needs and check for lease violations. In all, we do a minimum of four inspections during the course of a one-year rental. This helps us to be proactive with upkeep.
3. What are your protections against abusive tenants? There may be some wear and tear on the property, which is normal and always going to happen. If there is abuse, it can be very expensive and harmful to your bottom line. At Sarasota Management and Leasing, we have a property condition guarantee that we offer our landlords. This protects our owners from excessive property damage. If a tenant causes more damage than their security deposit, we pay the difference up to $1,000. It speaks to our diligence when it comes to oversight.
4. Do you have an eviction protection plan? Some property managers have such a plan in place to protect owners against eviction costs. If a tenant stops paying rent and promise to pay dates come and go, you can find yourself a month behind in rent. We have had landlords come to us after a tenant has fallen three months or more behind in paying rent, and at that point you have already lost a lot of money. You might want to pay a small amount every month for eviction protection so you can save on court costs and legal fees if you do have to evict a tenant.
5. What is your average days on market? This is a good indicator of how effective a property manager’s marketing is. For example, our average is 23 days on market. The average for the Sarasota area is 60 days on market. Imagine the difference; two months of lost rent waiting to lease your property is significant.
Ask all of these questions before you hire a property management company. If you’d like to discuss other things your property manager should do for you, contact us at Sarasota Management and Leasing.