There are many different property managers to choose from all saying they are the best. How do you determine which really are the best? Here are 6 helpful financial questions to ask during your search.
1. How much do they charge?
Property management companies typically receive a percentage of the gross monthly rental income. A majority of management companies on Oahu charge a 10% fee. There are a handful of companies that charge upwards of 12% per month. In addition, there are also a few firms or individual real estate agents that offer property management as an additional service and are able to charge lower rates around 8%. Visit www.redmontgroup.com to learn more about all the services Redmont Real Estate Group offers to help ‘Simplify Life’ for real estate owners.
2. What fees are not included in the monthly management rate?
Management companies may charge a reduced monthly management fee below 10%, but then include additional fees for other services such as advertising the units, set up fees, management fees even if a property is vacant, and an array of other types of fees. Be sure that you know which fees are being charged for all of the services that you require in the management of your property.
3. How many properties are being managed by the company?
On Oahu, a lot of companies and individuals offering property management services are mostly involved in the buying and selling of real estate but offer property management as well. Some may manage just a handful of properties, others will have a robust management division. Be sure to ask how many properties the company is managing so you can have a better idea of their level of experience
4. How are the vacancies being advertised?
Some management companies struggle to lease out their properties because they do not effectively market the vacancy or rely on the same advertising and marketing strategies used when marketing a property for sale. The more experienced property management companies will utilize specialized marketing and advertising methods to list a property for rent. These tools and methods are different than when properties are listed for sale. In order for you to have the highest quality tenants for the best rate, make sure the property manager is advertising in all of the areas where prospective tenants will be looking; not just craigslist.
5. What is the average number of days your rental is on the market?
Having your property vacant costs you money. The average rental property in Honolulu is vacant for approximately 56 days. A professional property management company can likely rent your property in 30 days or less depending on the time of year and quality of the property. Choosing the right property manager, that can get your properties leased quickly, will earn you thousands more a year.
6. How quickly are the monthly rents paid to you?
Some property managers utilize sophisticated management software that allows them to collect rent from the tenants online. Others still rely on their tenants to mail in checks or deliver cash to their office. Often times, these rents will not be paid to the owner until the end of the month. When choosing a property manager, make sure you choose one that is utilizing the latest management software and that your monthly rents are deposited in your account with a few business days after the tenant’s rent is due.