One of the biggest roadblocks to real estate investment success centers around a lack of knowledge, expertise and experience as a landlord.
You got into the business because you were convinced that investing in real estate and renting out your properties provided the maximum number of benefits for your financial future.
But the problem for most people is the down and dirty, daily management aspect of investing.
Wouldn’t it be nice to buy a property, sit back, kick your feet up and watch those rents come in like clock-work for years to come?
Problem is, somebody’s got to respond to those late-night emergency calls with busted pipes, air conditioning unit stopped in the heat of summer, and more.
If you still work a day job but want to invest for retirement income, or you want to be able to leave your day-job and go full time as a property investor, you’ll soon discover that there are two distinct sides of your business – business administration side and the property management side.
If swinging hammers, fixing plumbing, dealing with tenants and their requests, and maintaining properties is not for you, you need an alternative solution to management.
The best way to focus on growing a profitable investment portfolio while keeping your time free and headaches to a minimum is to work with a property management company in Carrol, County.
Mixed Bag
Hiring a property management is the ideal solution to investors who want to focus on maximizing ROI from their portfolio without the headaches, time investment and expertise required to manage well.
The only problem is that choosing the right property management company to work with is tougher than it looks.
What makes it especially difficult to find a solid property management company is the fact that it’s not a regulated profession in the state of Maryland.
This means that any Joe who hears “there’s money in property management” can hang out a shingle with zero training!
That’s why there’s an unusually large number of fly-by-night property managers. The level of service you may expect is all over the place.
This is especially troubling given the fact that the property management company you choose is like choosing your business partner.
Choosing the right property management company then, is no small task and directly impacts your success as a real estate investor.
That’s why I’ve put together this essential top 10 list of qualifying questions for choosing the best property management company.
I encourage you to print these out, bring the list with you and ask them of your property management firm candidates before making a decision on who to choose.
TOP 10 List of Questions to Ask a Property Management Company in Carrol, County:
Number 1: Do you belong to any professional organizations or hold any designations?
In the State of Maryland you do not need to be licensed to do Property Management. That means there is no accountability for the person/company management your most valuable investment.
That is SCARY!
When you are interviewing a Property Manager, they should at least be a licensed Realtor.
But, they should not be doing this on the side. It shouldn’t be a Realtor by day, and Property Manager by night. You need to know your property is a priority, not just a part time job. At minimum, having a Realtor manage your property will guarantee you have the backing of the Real Estate Commission.
But that isn’t enough.
There are no classes or trainings through Realtor licensing that teaches you how to manage properties and rentals.
You need to take it step further.
A Property Manager should be affiliated with a National Association that provides classes and instruction, like the National Association of Professional Property Managers.
If your Property Manager is an active participant in an organization like this, you can trust that they are up to date with the latest guidelines, and they have a professional network of educators.
Number 2: What are the set-up fees, are there any other fees?
While some management companies offer a lower percentage for managing your property, they have additional fees they add on-that could get costly. Do they charge extra to do inspections, go to rent court, sending you money, or maintenance surcharge?
Number 3: How do they advertise your property?
You need to ask about the marketing strategies they employ and the success rate of those strategies to ensure that your properties gets leased quickly.
Number 4: Do they know their numbers?
- Do they run like a business or are they a mom and pop shop that fly by the seat of their pants?
- How much does a typical work-order cost?
- How much does a typical make-ready cost?
- What is their vacancy rate?
- What is their collection rate?
- What is their eviction rate?
- What is the average days on the market for their clients’ properties?
Number 5: Do they have a guarantee?
No hidden surcharges, everything should be clearly listed in their management agreement.
24-hour Business Day Response time
24-hour maintenance requests
Money wire to your account on time, every time.
Number 6: When do they send your owner payment?
We pay our owners on the 15th and 25th of every month.
Number 7: Are you insured?
Your management company should have E & O (Errors and Omissions) Insurance, Genera Liability Insurance, and Workers Compensation Insurance. You may also ask if they have Cyber Insurance, to help protect your information and tenants information from falling into the wrong hands.
Number 8: Do they have an owner and resident portal?
Technology is important to you as the owner, the tenant and also to a management company to keep proper accounting records. Managers who do this the old-fashioned way have a harder time responding to questions in a timely fashion, and is more difficult creating proper reports for the owner.
Number 9: How transparent are they?
Do you have access to all service requests, work orders, invoices and bills paid, along with photos of inspections, etc?
Number 10: Do you own or have you owned any investment properties?
This is very important for two reasons.
- They speak from experience and knowledge. There is nothing like having someone guide you who has never made the same decisions you are faced with.
- When they are making tough suggestions, you can trust that if they were in your same situation, they have already had to make these decisions before. Do you really want to trust your investment with a “Do as I say and not a do as I do” person?
Conclusion
Once you’ve asked all of these questions, you should have a pretty good idea of which property management companies you should X of the list and which one you should go with.
By choosing the right property management company in Westminster, MD, you maximize your chances of building your portfolio faster with far less headaches and hiccups.
This is the path to better investing, with less headaches, less unnecessary costs and a lot more time to enjoy success!
What’s the #1 thing you want to know before hiring a property management company?
