BBB Tip: Property management

If you own a property that you want to rent out but do not want to be a landlord, a property management company can take care of the responsibilities for you. Property managers handle advertising, interviewing and screening tenants, collecting rent, checking the property, and doing routine maintenance. Here are some things to keep in mind when looking for a property manager.

• Get referrals. Decide if you are more comfortable with a small, local business or a large property management business and ask your realtor for referrals. Look for a property manager with specific expertise in the type of property you own. Be sure to check bbb.org for business profiles and to read the complaints and reviews for any company you are considering.
• Interview potential managers. Meet property managers in person to see if you feel comfortable with them. Make sure they address all your questions and concerns. Be sure to ask how many properties they manage and if they own any of the properties. When the property manager owns their own property, you may be competing for tenants. Find out how often they check on their properties and how they handle maintenance.  
• Check out their work. Look at the property manager’s current rental ads. The ads should be professional and appear in numerous locations. If possible, visit a few of the properties they manage. Look at the condition of the building and surrounding property. Talk to current tenants to see if they are satisfied with the management and maintenance. Ask if the property manager deals with complaints and repairs promptly. 
• Check licensing and certification. Research the requirements to work as a property manager in your state or province. Check with the real estate or licensing division to see what licenses property managers need to have. Make sure all their required paperwork is up-to-date. Ask if the property manager has a certification from a professional trade organization such as the Institute of Real Estate Management (IREM) or the National Association of Residential Property Managers (NARPM). Those with certifications from IREM or NARPM have completed challenging training programs and participate in continuing education classes.
• Discuss price. Property managers usually charge between 5% and 10% for their managing services. The manager should charge their fee based on the rent they collect rather than the rent that is due. This will prevent you from paying for tenants who have not paid their rent. Ask the manager what services the fee includes. Find out if there are additional fees for advertising, evictions, or visiting the property for maintenance.
• Review the management agreement. The agreement should define the property owner's and manager's responsibilities. Check that the agreement also details all included services, any extra fees, compliance with fair housing laws, and the cancellation policy. Make sure the agreement includes any oral promises made during the interview. Read everything thoroughly before signing, and do not sign if there are any blanks in the contract.

Find more tips and local results on BBB's property managers near you page.

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