How to choose a property management company is one of the crucial questions that property owners need to have an answer for, before they buy a property or with a current property they own.
Owning real estate is great. But the responsibilities that come with it can be overwhelming, especially if you are professionally busy. From protecting the building to addressing guest needs and marketing the property, managing vacation rentals is a demanding job.
Owning real estate generates passive income, true. But only well-maintained properties earn more than your financial expectations. Without proper management, your building loses its value.
If you are busy and unable to focus time on property management, then hiring a vacation rental management company is the best way to get the most of your property.
But, how do you ensure that your property is in good hands?
How to Choose a Property Management Company?
When you choose a property management company, you are choosing a manager to represent you to your guests and other stakeholders. Your brand reputation resides in this company and the way it manages your property and serves guests.
It is crucial you choose a company that shares your values in maintaining guest relations, financial obligations and property management.
Here are some tips to choose a property management company that works with your interests and benefits in mind:
Start with Referrals
Referrals are often an excellent starting point to get access to the best property managers in the industry. If you are a recent buyer, then your real estate agent can be a great source of referrals. You can also approach your real estate investor friends for some good prospects.
An online search can give you a list of property managers within your area. People can be generous with referrals and honest reviews of property managers on social media platforms.
Go for an Experienced Company with Local Knowledge
An experienced manager knows its job. The company can handle things on its own without you having to intervene frequently.
A company with local knowledge can help you get the best returns on your real estate investment. The company knows the local regulations – the risk of losing money to legal fines for failure to comply with local norms is nil.
A company with local knowledge knows the region, including its geography and people. The manager can advise you on the best ways to prepare your property for maximum attraction.
For example, the company can guide you on upgrades that can capture instant attention of guests, which gives you a sharp competitive edge.
Looking for property rental management in and around San Diego? Haustay Vacation Rentals is a well-known name in vacation property management in Carlsbad, Solana Beach, Encinitas, and Oceanside. We have over 26 years of experience in the real estate industry.
We understand the value of excellent customer service and are experienced in business strategies that give you maximum profits.
Ask for the Company’s License and Certification Details
License is a legal confirmation that the company is authorized by the state to do the work it is doing. A license also means that the company is obligated to maintain high work quality and ethics. Hiring a licensed company ensures that you do not end up in a partnership with an illegal service provider.
Professional certifications are an indication that the company keeps itself up-to-date with the latest in the industry. Be it real estate management skills or technology, certified companies are more likely to implement processes and systems that improve tenant and owner convenience.
Get a Clarity on the Professional Standards of the Company
How do the company employees behave with you? How accessible are they for communication?
How courteous are they in their communications and in-person meetings? How do they maintain their own office and premises?
These details give you insights into the company’s service standards. If they are not civil with you, the property owner, you can expect the same treatment for your guests too. If their premises are poorly maintained, then the chances of them taking good care of your property are thin.
Check the company’s client relationships. How long have existing clients been with the company? Were there any contract terminations? If so, why? Talk to these clients, if possible, to understand the reasons behind the termination. The longer the client relationships, the better the company.
How your property manager conducts itself is representative of your own values and standards to your guests. So, ensure that you choose a company that best represents you in service, quality, ethics and standards.
Understand the Company’s Performance
If you are wondering how to choose a property management company, then another key parameter to assess is the company’s performance. Ask for performance details of properties under the company’s management.
Look for the following factors specifically:
- Property occupancy rate
- Property vacancy rate (gives insights such as the length of time the property remains vacant and the speed at which it becomes occupied again)
- Average period of tenancy
- Eviction rate
- Rental property turnover rate (helps you understand if the duration between a tenant moving out and another checking in, is huge)
- Frequency of rent collection
- Delinquency data
- Frequency of late payments
- Frequency of on-time payments
Find Out about their Tenant Screening Procedure
Looking for more practical tips on how to choose a property management company?
While studying the manager’s eviction rate, ask the company about its tenant-screening policy. Every company has its own screening process. Understanding how they go about the screening tells you the extent of protection you are likely to get from the company.
Some key questions to ask the company about their tenant screening:
- What are the basic parameters they look for in tenants while screening them?
The company must check the following:
- Testimonials of former landlords of prospective tenants
- Job and income details
- Credit reports
- Personal references
- Any criminal history or poor financial history, including bankruptcy notices, eviction notices and legal notices
- Does the company reserve the property for a promising tenant? Do they wait for the tenant to physically occupy the property? Do they pull the property off the market before the tenant signs a lease? Is there a fee to do so?
Charging a fee covers you financially in case the tenant fails to fulfill his/ her obligation.
- Has the company ever been victimized by rental scams? What are the preventive measures the company has in place for protection against such scams?
- Who has the final call when it comes to confirming a tenant?
If the company entrusts you with this responsibility, then consider it as a red flag. You are hiring the manager so that things become easier for you.
Choosing the suitability of a tenant is one of the key functions of the manager. Tenant choices are a demonstration of their expertise. If the company shies away from this key responsibility, then perhaps you should not hire it.
Also, an ill-informed choice arising from owner intervention in the tenant-screening process can result in lawsuits, which can be costly for you.
Assess the Company’s Technological Competency
Technology use and integration are essential to speed up management and rental processes, and improve customer convenience.
Check if the firm employs an automated process to simplify rental management. In addition, you should be able to access data pertaining to your account as and when required through the system.
Haustay Vacation Rentals is up-to-date with the latest in real estate technology. We employ the most efficient technologies to give your properties the best visibility. Our management processes are simple and highly efficient, leaving no room for careless errors.
Ask about the Company’s Approach to Handling Maintenance
How does the company execute property maintenance tasks? What is their response time to
address guest requests? Are there any additional fees for handling guest requests for maintenance?
How does the company maintain the property during vacancy? What is the extent of personal attention that guests get? What are the steps taken by the company to protect a property from wear and tear?
Ask for client testimonials to know how the company deals with owners and tenants.
At Haustay Vacation Rentals, client properties are maintained regularly to avoid damage by wear and tear, seasonal changes, and other factors. Property inventory assessment, and repairs, are part of annual maintenance. Preventive maintenance is performed 6 months after annual maintenance.
Know about Data Reporting Procedures
It is important to receive periodic reports of your property’s performance and maintenance. Ask the company about their reporting frequency. A monthly report delivered by the first week of the following month is best.
Getting regular reports is crucial if other investors have invested in your property. You would have to keep them apprised of details about the upkeep of the property and the profits being received.
Review the Company’s Contract Policies
Get a sample of client property management agreements to understand the company policy. Look for the following key factors:
- What is the monthly fee for vacation rental property management?
- What are the responsibilities of the company and the client?
- How are client-company disagreements handled?
- What is the contract period?
- What is their service cancellation policy? What is the notice period?
Ensure that all key points are established in writing. Review their tenant agreements as well. You could seek the guidance of experts such as lawyers or legal advisors for contract review.
A Reliable Property Manager Augments your Property Value and Income
Finding a professional property manager can be a task, but the results are worth it. Partnership with a reliable property manager can help you in the following ways:
Realize Steady Cash Flow from your Investment
A professional property manager comes with property management expertise, which ensures that your property makes profits it is capable of. From maintaining your property to finding the right tenants and maintaining good relationships, a property manager does everything for you.
A professional company gives the advantage of industry network, which maximizes the occupancy chances of your property no matter the season. A property manager sustains cash flow by maintaining the right balance between low vacancy and greater profits.
Leave the Stress of the Job to the Experts
Collecting rents, marketing your rental property, addressing emergency repairs, and handling guest requests, are not the only stresses of being a DIY landlord. There are sensitive aspects you need to handle with expertise so that you do not end up in the bad books of law.
For example, you may inadvertently end up going against the state or Federal laws of discrimination while screening tenants. Similarly, tenant eviction is not easy. You need to know the state and local laws to execute eviction legally.
Ignorance of specific laws can land you in legal trouble and cause financial stress as you may have to pay up thousands of dollars as penalty.
Experience Peace of Mind
Partnership with a professional property management company gives you complete peace of mind as you know every aspect of your property is being handled efficiently. From property marketing and maintenance to tenant relationships and legal matters, these experts will do the best for you.
A fair fee in return for this peace of mind is totally worth it.
It Is Worth To Work With Haustay And Your Vacation Rental
It can take a couple of months to study a company and assess whether or not you could have a working relationship with it.
How to choose a property management company? If this is a key concern for you as a property owner, then the above tips can help you find the right solution. An efficient rental management company can take over the stress of managing, and profiting from, your real estate.
You can focus your attention on your profession and family while your real estate investment keeps reaping the benefits of your timely decision.
