What should I expect from a property management company?

Question

I am interested in buying an investment property in PA. I would like to put in the hands of a property manager. The problem is that I am not sure of what to expect from these companies. I would like to know what is a good offer and what is not.

Answer 1

You want to make sure you go with a reputable company so ask around before you make your decision. You want to make sure there is a credit check on all potential tenants and possibly a background check as well. The company should do routine inspections of the property while the tenant resides there. I would say as often as every 6 months. The company should have reputable repairmen/companies with which to do repair work should something happen. The company should have no problem notifying or even suggest that they notify you before any major repairs, say over $200, are done. Every state and/or agency may charge differently but it's usually a percentage of the rental amount or $15, whichever is greater.

Answer 2

A good property management company will write a contract with you spelling out who is responsible for what, what their compensation is, etc.
They should work for a percentage of the rents collected, the actuall percentage depends on if it is comercial or residential property. In the contract, it should outline what steps need to be followed for tenant screenings, property repairs, court filings and so forth. The company must also provide you with a financial statement showing your account activity (minimums are set by law in each state)....
If you are curious as to the performance of a particular company, check with the state's realty board and see if complaints have been filed against it. One big plus when picking a company is making sure they are licensed and bonded.

Answer 3

if they go on a flat rate they will probably screw you, you want more of a company which will go on %. That way they will work for it.

Make sure you get your attorney to draw up a good contract, make sure they have clauses regarding incompetent action and options for you to dissolve the deal.

Good Luck, and do your research.