It happens very often. When I receive new business calls, people time and again go directly to asking the question, “How much do you charge?” Sometimes the question seems to be asked before I can even say hello.
I have learned how to handle the question without losing calls and turn many of the phone calls into new business for our company, because I know without a doubt it is not the only question that needs to be answered for the caller to make an informed decision.
In every downturn of a real estate market, many realtors will try to augment their income by doing property management on the side. Real investors know the difference between a bona fide property manager’s ability to manage property and the more often novice abilities of real estate sales agents.
Also, as in this current down market, which is symptomatic of millions of foreclosures, there have been groups formed which have bought millions of dollars of single family homes and started property management companies, and have little-to-no property management experience.
The result of these aforementioned scenarios is poor service, offered sometimes at premium fee structure, and sometimes at a discounted fee arrangement. Either way, experience and service should always be the primary concern for anyone seeking a property management company to manage their costly investment(s).
When looking for a property manager or property management company, ask these 4 questions:
- How long have you been in business?There is no “right” answer, but I believe it takes 5-7 years of experience to begin the understanding that property management is a tough business. The company or person you want should have staying power, stability, and solidity.
- How many properties do you manage?The answer can be 1, 10 or a 1,000, but the answer to this question gives validity to the next.
- How many people in your company deliver service for your clients?I believe the answer is 1 person for every 50-75 doors. This can vary by the size of the service area and if there is an in-house maintenance company helping with delivery. If the ratio is 1:100 or more, you’ll likely find the person or company hard to reach on the phone, slow in response, there’ll be mistakes in accounting and tenant retention percentages to be low.
- What are the costs of doing business with you?This will be the easiest question for a capable property manger to answer, if his service matches his cost. The lower the cost is likely to mean poor service. A higher cost can result in the same poor service, depending on the experience and integrity of the property manager or company.
You will be able to tell the experience, integrity and quality of a person or company by the conversation you have by asking these questions. While cost doesn’t always mean value, it is generally true that we get what we pay for.
Until next time,