You’ve heard the rental nightmare stories. Maybe you lived a few.
Midnight phone calls that the tub is overflowing. Tenants who don’t pay the rent, and then leave behind hundreds of dollars in damage. Collecting 100 applications for one vacancy. Accusations of breaking landlord/tenant laws that you don’t even understand.
And this was supposed to be an investment and a source of income? After a while, it probably doesn’t seem worth the hassle.
You hire a property manager to take over for you. In your search, you went with the company who offered the cheapest fees. Since this is all about making money, you don’t want to pay too much.
It sounds like a good plan until you have tenants breaking leases and not paying their rent. When you receive your monthly statement, you barely understand it but no one answers the phone when you call with questions.
You know the saying – you get what you pay for.
Take a look at what you can expect when you choose a high-quality property management company and pay higher fees.
Without tenants in your home, you’re not making any money. When you have a string of bad tenants who don’t pay or damage your property, you’re losing money. A good property management company will do more than the bare minimum to put the right tenant in your home.
Cheap fees get you a rental history which can easily be faked and maybe a credit check. After years in recession, credit checks are no longer the best indicator of whether a tenant can or will pay. Instead you want someone who will look at a tenant’s employment history, their income-to-rent ratio, and their reason for renting as well as rental and credit history.
No property management company can guarantee you’ll never have a vacancy. With competitive pricing, aggressive marketing, and a thorough and consistent screening process, tenants stay in a property longer. An empty property doesn’t make any money, but it doesn’t pay to put just anyone in your rental.
The cheap property manager may not have the funds to advertise as well as they could. You already know they might not have the most thorough screening process. If they’re a portfolio property manager, they certainly don’t have time to devote to your property. Ultimately, you’re the one who suffers with vacancies that last for months at a time.
Repair Costs that Make Sense
When it comes to making repairs to your property, you want a company that will treat your rental like their own property while understanding that budgets are important. A cheap company will likely go in one of two directions. Either they hire the same contractor for every maintenance job, racking up hundreds of dollars in fees for the most basic repairs or they hire a cheap handyman who may not do the repair well.
What you need is a company that has established relationships with vendors around the area: plumbers, electricians, appliance repairmen, and handyman services. When a repair is needed, the right company for the job with competitive rates will be the one called. If you work with the property management team at ERA American Real Estate, you have the option of doing repairs yourself or allowing us to handle them for you. We communicate with you the entire time so there are no surprises.
You should expect to receive a monthly statement from your property manager to show you the income and expenses for each of your properties. If you have questions, you should be able to pick up the phone or send a quick email and get answers. When something isn’t correct, you have every right to expect it will be taken care of immediately.
Unfortunately, too often with cheap fees comes little, if any, communication. It’s almost impossible to get someone on the phone, and when you do, they don’t have time to answer all your questions. You may not even receive a monthly statement or when you do, it may not have all the information you need or want.
Fair Housing Law Knowledge
Anyone you hire to manage your property should have a basic knowledge of fair housing laws. They should be able to tell you what the protected classes are and know how to keep up with the different changes that occur nearly every year. They should know that you can refuse to allow pets in your rental but not service animals.
Why does this matter? If a tenant makes the accusation that their legal rights are violated, it’s not your property manager that pays. As the owner, it’s ultimately your responsibility. After you consider the quality of tenants or the amount of rent a property manager promises they can get for your property, you need to make sure they are on top of fair housing laws to keep everyone out of trouble.
The instinct to choose the property manager offering the cheapest fees makes sense. You’re in the rental business to make money. You don’t want to pay more than you have to for anything. We understand that need. However, the amount of time and money you’ll spend in expensive repairs, evictions, unnecessary vacancies, and legal fees for violations of the law will far outweigh any savings you see with the cheap company.
Here at ERA American Real Estate, we aren’t the cheapest in the area, and we don’t want to be. What we want to be is the best. In order to offer you valuable service, peace of mind, and help in achieving your financial goals, we set high standards for everyone we work with – tenants, vendors, and our employees. You pay a higher fee, but you get what you pay for and more.