Wednesday, 24 May 2017

4 Things to Look for When Signing up With a New Property Manager

Written by Posted On Tuesday, 12 August 2014 13:56
Living room of a vacation rental near Disney World Living room of a vacation rental near Disney World image provided by www.orlandovacation.com

If your vacation home or condo is in a short-term rental program then you’d likely benefit from hiring a property manager. Here are 4 things to look for as you search for the right manager to hire.

1) Trustworthiness

Hiring a trustworthy property manager should go without saying, but since most vacation home owners don’t live near their vacation home, it’s truly a key component. The first step is to look around the community, identify which homes are well kept, and ask those owners for the name of the property manager they use. If they’re keeping your neighbor’s homes in good order, then it’s likely they’ll do the same for yours. Next you’ll ask members on the HOA board who they recommend. Finally, if the community has 24-hour guard services, talk to the guards and ask who the best property managers are. The security guards are on the front line and often known more about what’s going on in the community than anyone else, and their recommendations should be held in high regard.

2) Interview at least 3 property managers in the area

Don’t pick the first property manager that’s recommended to you. Here are a few of my favorite questions to ask during the interview process:

a)      Who is actually in charge of my house? Ideally the owner of the business should take full responsibility for the conduct of their employees, and should be clear that they are the person responsible. However, there also needs to be a plan in place, including checks and balances, to make sure your vacation home is kept in tip top shape.

b)      How does your company handle cleaning and repairs? Ensuring your house is clean for every guest should be one of the top priorities of the property manager. They should have a detailed plan describing their cleaning procedure and how they make sure it’s clean for every guest. There should also be an agreement between you and the property manager regarding repairs. In Orlando, we typically contact the owners if a required repair is going to cost more than $100. If it’s less than $100, then the property manager usually takes care of it and bills the owner on their next monthly statement. This conversation is important because you don’t want the property manager to make any and all repairs, no matter how expensive, without some safeguards in place. Remember – owning a vacation home is just like owning any other business: expenditures should be in line with revenue.

c)       If we don’t choose you, who would you recommend we choose? This is a great question because if I interview several property management companies and they keep mentioning ABC Management then I know I need to talk to ABC Management. The ideal answer to this question is for the property management company to recommend 2 or 3 other companies, but then state why they are better. I am a property manager myself, and I am confident enough in my company and my team to give out other company names for potential customers to check out. I am confident that the homeowner will inevitably return to me when all is said and done.

3) Put checks and balances in place to protect yourself

Most property managers will want to pay the monthly bills for you because they don’t want a guest in the house and have the utilities cut off in the middle of the night due to non-payment. Since they’re paying these bills for you, they’ll need enough money on hand to do so, and in some cases they’ll expect you to put $1,500 to $2,000 in escrow. Don’t do this! Pay your own bills and tell the property management company that you’re not going to put money in escrow. If you decide to leave the management company you’re likely to not get all your escrow money back, so it’s best to simply skip this step.

Paying your own bills is also a good check and balance system to ensure you’re getting paid for all the guests who are staying in your vacation home. Your booking calendar should perfectly match up with your electric bill. If someone isn’t in the house then the bill should be less than it is when a guest is staying there. It just takes one or two times of not getting paid for guests to make a huge difference on your profit / loss statement at the end of the year.

4) Start off with a short-term agreement

Tell the property manager that you want to start with a 3-month agreement, and that if it works out you’ll ante up for another 3 to 6 months. When you keep your property management company on short-term agreements, you’ll keep them on their toes and ensure they’re always doing everything they can to keep you happy.

The main thing I would like to get across to vacation home owners is to keep your property manager on a short leash, at least at the very beginning of the relationship. Most property managers are honest and do things the right way, but as in any industry there are a few bad apples out there. Remember, everything is negotiable before you sign an agreement. Be sure to have some check and balances in place to make sure everything is on the up and up. Also make sure you have a painless way to get of the agreement should you find the property manager turns out to be not as good as you first thought.

My name is Trey Duling, and I hope you found this article helpful. If you have a vacation home in the Orlando area, I would love to talk with you about managing your property. Please visit my website at http://www.orlandovacation.com/home-rentals or call me at 1-800-633-7108 ext 7007.

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Trey Duling

Trey Duling is the owner of Orlandovacation.com. He has been managing and renting vacation homes in Orlando since 2001. If you have a vacation home in the Orlando area and you are looking for a property manager give Trey a call at 1-800-633-7108 ext 7007.

www.orlandovacation.com
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