Top 4 Qualities to Look for in a Property Management Company
When looking for the right property management company for a multifamily asset, these are four characteristics investors should keep an eye out for.
There is a world of difference between owning a multifamily property and operating one. In most cases, multifamily investors don’t purchase properties with the intention of becoming landlords, and that is where property management companies come in. Property management companies are third-party entities that can be contracted to handle the daily operations of a property, or portfolio of properties.
Multifamily investors ultimately seek to make worthwhile returns from the assets they hold. That said, successful assets in the multifamily sector are quite often those that have high tenant satisfaction and a low vacancy rate. Hiring the right property management company is one of the most impactful ways an investor can work towards those goals.
Of course, in order to hire the right property management company, investors first need to know what to look for. With the reputation of an asset at stake, placing the management of its daily operations into the wrong hands can be a costly mistake. With that in mind, we’ve compiled a list of the four most essential traits that investors should look for when looking to hire a property management company.
The 4 Essential Qualities that a Property Management Company Should Have
Attention to Detail
Operating a multifamily property is no easy feat. The job often involves vetting and eventually assisting a variety of different tenants, a vast assortment of complex legal and maintenance processes, lengthy contractual agreements, and so much more depending on the property. Property managers and their teams must be able to maintain the asset, and ensure that the property can both attract and maintain tenants.
This may seem simple enough, but there is often plenty going on behind the scenes of some multifamily assets, typically increasing in magnitude the more units a property has.
With so many different things that require urgent attention occurring on any given week, it takes near inconceivable efficiency to see that everything remains in order while keeping all of the tenants not just simply satisfied, but legitimately pleased. A good property management team leaves no tenant concern unaddressed and takes great care with all matters pertaining to the operation and upkeep of the property.
Excellent Communication
When managing a property that serves as a home to an assortment of different tenants, some with families, having good communication skills is crucial. It is the job of a property manager to effectively communicate with tenants for a variety of different reasons. Tenants should always be kept notified of what’s going on at the property, particularly any major safety or maintenance inspections, repairs, or modification work.
Communicating any possible disturbances to a tenant’s way of life or enjoyment of their unit in a timely manner — that is, giving ample time for a tenant to prepare themselves — is more than a simple common courtesy. Tenants are less apt to get upset regarding even the most intrusive of processes when given notification well in advance. Honest and timely communication can sometimes be just enough reason for a tenant to renew their lease.
Strict Enforcement of Rules
Almost every property, at some point or another, becomes the home of a troublesome tenant or two. These tenants find it hard to obey the rules or can be an annoyance or source of discomfort to other tenants. While keeping a great reputation with the tenants in a market is of great importance, it is almost equally important to command strict adherence to the rules and regulations of a property in order to mitigate liability risk and to ensure that all tenants get to enjoy their homes.
Making sure that tenants and staff alike follow all rules and regulations is vital to the daily operation of a multifamily property. Tenant discomforts aside, multifamily properties are often subject to strict laws and detailed inspections — and failure to comply with or meet certain standards can become quite costly.
Personality
Though this quality is often easily overlooked in favor of some of the others, choosing a property management company that plays a larger role in the lives of tenants can do wonders for their satisfaction. Multifamily properties may lack the fabled white picket fence, but they should still feel like home to the tenants that choose to live there. A well-maintained property is one thing, but a memorable staff that feels like family makes a property feel less like a lease and more like a home to a tenant.
Ideally, a property management staff must consider the delicacy of working where people live. Staff should treat each and every tenant with respect, and there should be no exceptions when it comes to manners and politeness.
There are always tenants who can not be impressed, but the vast majority greatly appreciate it when the management team exhibits top-of-the-line service. The companies that aren’t afraid to go above and beyond, planning events and getting involved with their communities are the ones that tend to attract and retain long-term tenants.
Related Questions
What are the most important qualities to look for when selecting a property management company?
The most important qualities to look for when selecting a property management company are personality, professionalism, experience, and customer service.
Personality is important because it helps tenants feel like the property is their home. A well-maintained property is one thing, but a memorable staff that feels like family makes a property feel less like a lease and more like a home to a tenant. Ideally, a property management staff must consider the delicacy of working where people live. Staff should treat each and every tenant with respect, and there should be no exceptions when it comes to manners and politeness.
Professionalism is also important. Property management companies should be professional in their dealings with tenants and other stakeholders. They should be knowledgeable about the industry and have a good understanding of the laws and regulations that govern the industry.
Experience is also important. Property management companies should have a good track record of managing properties and should be able to demonstrate their success in the past.
Finally, customer service is essential. Property management companies should be able to provide excellent customer service to tenants and other stakeholders. They should be able to respond quickly to inquiries and complaints and be able to resolve issues in a timely manner.
These are the most important qualities to look for when selecting a property management company.
What are the benefits of hiring a professional property management company?
Hiring a professional property management company can provide a number of benefits for landlords. According to Apartment Loans, these benefits include taking away the hassle of managing the property, as well as providing services that landlords may not be able to do themselves. Additionally, Commercial Real Estate Loans states that a great management company can help maximize leasing income and ensure that tenants are happy, which can help prevent tenants from moving out.
What should I consider when evaluating a property management company?
When evaluating a property management company, you should consider the following qualities:
- Personality - The property management staff should treat each and every tenant with respect, and there should be no exceptions when it comes to manners and politeness. Companies that go above and beyond, and plan events and get involved with their communities tend to attract and maintain long-term tenants.
- Experience - Look for a property management company that has experience in the type of property you own. They should have a good understanding of the local market and be able to provide you with the best advice.
- Reputation - Check the company's reputation by reading online reviews and talking to other property owners. You want to make sure that the company is reliable and trustworthy.
- Cost - Compare the cost of different property management companies to make sure you are getting the best value for your money.
For more information, please see this article.
What are the risks of not hiring a professional property management company?
Not hiring a professional property management company can be risky for landlords. Without a professional property management company, landlords are responsible for all aspects of running the property, such as maintenance, rent collection, tenant screening, and more. This can be time consuming and require a significant amount of energy and money. Additionally, landlords may not have the expertise to handle all of these tasks, which can lead to costly mistakes. For example, landlords may not be aware of all the local laws and regulations that apply to their property, or they may not have the experience to properly screen tenants. Without a professional property management company, landlords may also be unable to respond quickly to tenant requests or emergencies.
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What are the advantages of hiring a property management company?
Hiring a property management company can be a great way to take some of the hassle out of being a landlord. Property management companies can handle all of the aspects of running the property that you don’t want to do, such as tenant screening, rent collection, maintenance, and more. Additionally, they can help maximize your leasing income and ensure that your tenants are happy, which can help reduce tenant turnover.
For more information, see 5 Tips for New Landlords and 5 Proven Tips for Your Next Value Add Investment.
What are the best practices for selecting a property management company?
The best practices for selecting a property management company include looking for a company that has a good personality, treats tenants with respect, and is willing to go above and beyond. Additionally, it is important to look for a company that is involved in the local community and plans events for tenants.
For more information, please see this article from Multifamily.Loans.