Imagine taking your car to a shop and the mechanic quotes you a repair before he ever opens the hood. He has not looked at the engine, he has not put it on a lift, and he is already telling you what it will cost and how long it will take. You would walk right out of there.
Now think about how some owners hire a property manager.
They call, they get a rate, they hear a rent number, and they sign. Nobody walked the house. Nobody read the lease that is already in place on the tenant who lives there. The manager is making promises about a thing they have never actually looked at.
What that tells me
When a manager tells you what they can do with your property without seeing it, there are only two explanations, and neither one is good for you.
They are new and do not know enough to know how risky that is. They have not been in the game long enough to know what could go wrong.
They do not care, because they are trying to sign you up. The goal is the signature, not the results that the client needs and is paying for.
Either way it is a quantity play. They onboard you fast, and they will off board you just as fast when the house gets hard. And old houses in our market get hard.
What should happen before anybody signs anything
Before One Focus agrees to manage a property, we look at it. Basement to attic, no locked doors. Every time. Here is what we are doing on that property visit:
Checking the condition of the property, identifying health and safety risks and deferred maintenance
Reading the existing lease, if there is a tenant in place, so we know what you are already committed to
Checking to see if the current tenants are compliant with the terms of the lease
Finding out whether the security deposit was collected, how much it was, and where it is sitting
Checking whether the municipality requires a rental license or an inspection, and whether the property has one
Checking whether the tenant has a lead-based paint disclosure if the property was built prior to 1978
Looking at the rent against what the house can really get today, not what you leased it for
Telling you what we see, even when it is not what you were hoping to hear
When we are done with the property visit, we should understand the investor’s goals and the condition of the property. We will write a stabilization plan that tells the owner exactly what we will do to stabilize the property if we are hired. Our definition of stabilized is “attracts and retains qualified tenants at market rent.”
Questions to ask the next manager who calls you
If you are interviewing managers, and you should interview more than one, ask these:
Will you walk the property before we sign a management agreement?
Will you read the lease that is in place and tell me what you would like to see change?
What would make you turn this property down?
What happens in month three if the tenant stops paying?
How many other properties does the person managing mine have on their plate?
The bottom line
A management agreement is not a subscription. It is a business partnership over a property you plan to own for a long time. A manager who will not look at the house before they say yes is telling you exactly how much attention the house will get after you sign. I made a guide to hiring and firing property managers that you should check out if you want all my advice.
We would rather take the time up front. If you own rental property in North Central Pennsylvania and you want someone to actually look at it before they make you promises, that is a call we are happy to take.
