How to Pick the "Right" Property Manager

LOS ANGELES - Jan. 28, 2020 - PRLog -- Be Wary of "Mom-and-Pop" Operations

         I prefer to use a medium-size property management company, rather than a "mom-and-pop" company. These kinds of operations usually don't have the staff to do an adequate job. In addition to managing smaller units, they are typically involved with real estate brokering.   I've actually seen these operators give prospective tenants the key to a vacant unit, rather than showing it themselves. This type of marketing effort won't do if you're trying to keep vacancies down.

Be Just as Wary of the "Giants" in the Field

         Larger property management firms are geared to institutional investors. Midsize apartment buildings somehow get lost in the shuffle.  Individual attention suffers. The needs of your building might have to wait until those of a much larger complex are met. Your building might be assigned to a new or relatively inexperienced property supervisor to provide training.

Procedure Manuals Are Critical

         Ask to see the operations or procedure manual of the firm. Read it and ask questions. You'll get a clear indication of how a property management company manages apartment complexes from the manual. Be leery of the company that doesn't have one. In fact, do not consider using a company unless they have a formal plan on how they manage apartment buildings.

What to Expect from Your Property Manager

         Under no circumstances should you run the day-to-day management operations. Your role is to properly monitor the project in order to establish effective policies and to make management decisions.

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        If you want to give additional incentive to the property management company, offer them a bonus based on the building's performance. It could be based on net operating income or the overall improvement of the complex over a period of time, usually one year.

ABOUT THE AUTHOR: Eugene E. Vollucci,  is considered to be one of the foremost authorities on real estate taxation and  investing and has authored books in these fields published by John Wiley & Sons of New York. He is the Director of the Center for RE Studies, a real estate research organization. To learn more about the Center, please visit our web site at http://www.calstatecompanies.com