How Property Management Companies can
outsource the responsibility
The purpose of hiring a property management company is to outsource
the responsibility of maintaining and improving your property.
As this task involves a lot of expense as well as delegation
of authority, deciding which company to go with and what sort
of contract to get into are hefty decisions. Some contracts e.g.
allow the manager to try and increase the value of the property
in addition to other services.
Before you make your choice, ensure that you are fully aware
of exactly which services you require, as not all those offered
will be of relevance to you. Typical services involve the collection
of rent, finding of tenants, repair work on the property or even
the handling of disputes. You must specify these services in
the contract so there is no room for argument in future. The
property management service will also solicit bids for improvements
and allow for easy communication between home owners, tenants
and the board. They will also stay on top of all changes and
developments in the law and understand the risk management process.
Property management companies or also often called letting
agents but are in effect the same.
The internet can be quite helpful in assisting you with finding
a property management company that matches your needs. Many companies
have websites online that provide essential information and provide
means of future contact. Other landlords can also give practical
advise and help with the decision by providing a personal or
rather experienced reference of companies they have worked with
previously. You should then agree to meet with your selected
property manager and discuss the tasks you wish to be assisted
in and clarify issues of pay and power. Always ask about their
experience, fees and what those fees cover, the type of accounting
they use and whether or not they will cover the insurance part
of the process.
Fees will likely be based on the location of the property, the
number of properties and the specific services that will be delivered
by the property manager. Often, a flat rate fee or percentage
of the rent is charged and adjustments are made for repairs or
material costs that are likely to occur in the future. You can
avoid future discrepancies by setting out a range for these extra
costs so you do not find yourself paying too much without prior
consent from the property management. Some companies avoid this
step all together by offering all-exclusive packages which already
account for any extra maintenance costs that could arise.
The ensuing contract will set out the fees, duties, period of
employment for manager, renewal procedures and procedures in
case of breach of contract. Some companies wait for cues that
signal the need for maintenance whereas others actively look
for problems and sort complaints out on their own initiative.