Property Management

Residential Property Management Services Explained

residential property management servicesConsumers require residential property management services for a variety of reasons. As a result, some buy rental properties and need someone to look after the property. Other consumers will be absent from their homes for a long period of traveling. Look after your home. We will review these issues and others in the following post.

Residential Property Insurance Services Requirements

Many homeowners just close their doors and leave for their vacation. Many are very excited about getting away. They do not give a second thought about looking after their home. Many insurance companies have specific requirements about vacant homes. These requirements depend on the company, the time of year, where you live, and your heating system. Your insurance company may want someone to check your home every day. Call your residential insurance company to confirm their requirements to maintain insurance on your home. Also, condominium owners need to do this.

Temporary Absence Management

Many residential property management services companies will offer services to homeowners in this situation. Management companies can check your home for water leaks, power outages, heating system failures, and break-ins. Always have them check your home and report back to you after every visit. The report will be especially useful if you need to make a claim to your insurance company. They want to know that someone is checking your home for all potential emergency conditions.

Extended Absence

Arrange for residential property management services if you are leaving for an extended period. They will check for water leaks and heating system malfunction. For example, they may also provide landscape management, snow removal, and even water the plants. In other words, consumers can arrange for all of the services they need. Therefore they can leave their home with confidence.

Rental Residential Property Management Services

Many consumers purchase rental properties as investments. Some consumers will manage their own properties. However, others do not want to deal with tenants or some of the problems that arise. In other words, residential property management services can put your mind at ease. For example, services included are:

  • Tenant selection and approval
  • Rent check collection
  • Deposit to bank accounts
  • Property management services
  • Property repairs
  • Regular monthly reporting

Property management covers all of the things that most consumers take for granted about maintaining a home. In addition, this area of services may include the following depending on the building type:

  • Cutting the lawn
  • Hedges and shrub maintenance
  • Maintain watering system and watering the lawn
  • Routine repairs to appliances
  • Painting and cleaning after tenants leave
  • Management of special projects e.g. window replacement etc.

Residential property management services Summary

There is a property management solution for all situations. To clarify, decide how much time you will need a property manager. Subsequently, give your insurance company a call to confirm their minimum requirements. After calling your insurance company calls the management company. In addition, make sure that you will receive appropriate documentation from the residential property management company. After that, if you have to file a claim you will need these documents to make an insurance claim.

Stopping Dresser Drawers Falling

dresser drawers fallingA wall strap, an L bracket, screws through the backboard of the dresser all could have prevented this accident. Kids will be kids. They love to climb and they will whenever they get the chance. If the dresser is top-heavy either because of the child climbing on extended drawers or the contents, it is going to fall over. No matter how many times you tell them they will climb. Stopping dresser drawers falling is actually quite easy. You just need to take the time to properly secure them. It does not even cost that much either.

Stopping Dresser Drawers Falling

There are several ways to secure the cabinet so that it will not fall over. One way is to securely attach a cord to the wall and to the back of the dresser. Make sure you screw a strong hook into a stud and not just into the drywall. A screw will easily pull out of the drywall. The same goes for the back of the dresser.

Some people like to use L brackets which work really well. The cabinet cannot be moved at all once installed.

Another approach is to use long screws through the backboard of the dresser into the wall. Again make sure the screws are screwed into the studs and not just into the drywall. Most people will use a stud finder to help them locate the studs behind the drywall. Usually, they run vertically up the wall.

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Building Manager Training

Property ManagementWhat training does your building manager need? How much past experience does your property manager have? Does he have experience with the systems that you use? For example, maybe you’re using a new computer system to keep track of all work activities. As well as reporting of expenses. You may want to train him on these items. There may also be training required on specialist pieces of equipment.

In addition a building manager is interfacing with your customers all of the time. They represent the owner of the building in all things. Items such as customer relationship management. If you are getting lots of complaints from tenants, you may want to find out what the fundamental issues are. Consequently you may want to initiate some sort of training to deal with it. The building manager really represents you to your customers. As a result as a property owner, it makes sense to hire the best!

Building Manager Training – What is Needed

Every buildings needs are different. High rise vs. townhouse condo. Residential vs. commercial buildings.  All have different kinds of equipment that are used to maintain the property outside. As well as to maintain the indoor common elements of property. This could be as simple as making sure that they’ve read all of the instruction booklets and maintenance booklets. Have they developed and adhere to a maintenance program.

Local by laws as well as State or provincial laws change from time to time. It could be as simple as making sure that they read all of the notices. Or for a particularly complex piece of legislation, there may be a one-day seminar training session.

Accounting software updates occur all of the time.

Building Manager Training – CRM Systems

CRM systems or customer relationship management systems are also upgraded on a regular basis. Anytime there is a change property managers who enter information into the CRM system should be re-trained. It could be as short as a one hour seminar. Or you may need a more in-depth session for more complex updates and changes.

Equipment training is also valuable to ensure that the equipment is handled properly. Focus on safety  for the operator as well as individuals that may be in close contact with the equipment.

Communication skills on the job are extremely important in dealing with prospective clients, clients and owners. Can your property manager use better communication skills in terms of verbal and written activities? There are one-day training seminars available.

There are always special needs of the job that require training from time to time. Hence you have a choice of either letting the property manager or the person operating equipment etc. experiment. Also you can train them properly so that they will operate it in a safe manner. In addition avoid accidents that could damage the property. Train the operator.

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Property Manager Online

Many customers can now have access to online reports from their property manager online reports to view their online statements, progress on various projects and overall status of a property or a unit. This is a huge time saving tool. If managed properly can actually improve customer service to tenants. In addition reduce the overall cost of managing the building. But not all property managers are providing online information for their tenants. Or their owners of the properties that are being managed. Their focus is on property management. Also avoiding added investment in costs that are not deemed to be beneficial from a return on investment perspective. However the more competitive property managers are considering this latest technology innovation. It is up to you as owners and tenants to place some pressure on these property managers to improve their online services

Property Manager Online – Up To date Reports

Superintendents can also update reports online to provide a status to their owners. As well as to the tenants to show them when various repairs will be made and what projects are ongoing. For large companies this is particularly useful information. Especially when tenants call to find out about the status of their project. They can logon to the online site and review the latest status about issues they may be concerned about. The same applies to owners and other interested parties that have access to the system. There would be many less phone calls as a result.

This saves everyone a great deal of time. Reports are automatic and people only need to discuss details if there are questions on any updates. This is customer relationship management for property managers and owners. CRM in short for PM. Large apartment buildings with many units and property managers managing many dispersed buildings will find they can save a lot of time by being online and reporting information quickly and easily.

Using Smart Phones Online

Use smart phones to do updates and trigger reports. As long as you have a data connection or Wi-Fi connection, smartphones and tablets can be used to create updates as well as view results online. This is particularly important. You can immediate answers on site or during a phone call based on a report you can pull up on a smart phone.

We are writing this report using a smart phone for this post about online property management. In fact we are using an iPhone, using the dictation Siri feature to dictate the text of this post. It is an awesome feature. Use Siri to update reports and results of repairs or projects.  There is no need to type, just dictate your status update!

The Way of the Future

This is the way of the future for this industry and others. If you are not already using online reports, with access by tablets and smartphones it’s time to get on the bandwagon. Significant savings can be achieved as well as significant improvements in communication between owners property managers and tenants. Although there may be an initial up front cost to get started and you may also want some customization, there will be a net savings overall with better customer relations thrown in which can be invaluable.

There may be some resistance to using these new tools by the property manager or the onsite superintendent. Once they learn that it can actually save them time and communicate more easily,  they will be willing to quickly adopt online property management techniques. We also find that the larger companies are more likely to embrace these new technologies as compared to small rental companies. They simply do not have the resources to devote to developing, implementing and managing online property management systems. If you are a renter, this might be something to consider when it comes to renting a property.

Changing Condo Board Members

Changing Condo Board MembersCondominium board members are usually elected for one year terms or sometimes two year terms. They usually rotate through positions such as president, treasurer, vice president and secretary. Changing Condo Board Members is usually very difficult. Most people are reluctant to become members of the condo board. They may be frightened about the responsibilities. They may be concerned about the amount of work that they will encounter.

Many people may just not want to deal with the hassles that they feel a condominium board must deal with. They simply might not be interested enough to get involved. The condo is running properly and no one is too upset. Most people are satisfied to let someone else do the work.  When there are issues, it can be time for changes to the condo board. The single biggest issue for most condo owners is when a special assessment is levied for some major repair work. As a result this usually gets everyone interested and attending meetings. If people feel there is mismanagement involved or things could be done better, they sometimes will be upset enough to get involved.

The bottom line though is the condo needs volunteers to fill these positions. They assume responsibility to manage the condo building. The condo board is also responsible for managing the  the property manager and all issues that may arise from time to time. Issues can be raised by either the owners or the residents or the property manager.

Do Board Members Overstep their Boundaries

Occasionally some condominium board members overstep their boundaries becoming too dictatorial. Sometimes they avoid or not take into account other owner requirements and generally not doing the job they are supposed to be doing. This is the time for changing condo board members. Other owners must step up and run against them to become members of the board through the democratic election process.

If you do not get involved and deal with some of these issues then you really have nothing to complain about. A condo board member must also be a an excellent communicator to get their ideas across other wise they risk being perceived as overstepping their boundaries or not listening to the complaints of the owners who are not on the board. It can be a very political position at times.

Changing Condo Board Members: Something to Think About

The following is a summary of points the condo board members need to take into account. This is doing the job of managing the condominium building. Take a look at these and ensure that your are not over stepping your  boundaries.

  • Elected for one or two year terms
  • No one wants the job
  • Usually volunteers
  • Some on a power trip
  • Sometimes need to be changed
  • Need to be competent
  • Must be able to listen
  • Need to be responsive
  • Be professional

Another point is that we recommend that all decisions are documented including proper motions. Also who seconded the motions and how many people voted in favor of the motion. If these decisions are properly made, then it is pretty tough to disagree after the fact.

On one board that we are familiar with, the president of the condo board has been in place for 17 years. This is far too long for many reasons. It is clearly time for changing condo board members so that the president along with other members are changed. They can become stale and outdated and even burned out. The task of changing condo board members may not even be that difficult. Owners must be willing to step up to their responsibilities.

Condo Boards Role in Property Management

Condo Boards RoleThe condo board has the primary responsibility for managing all aspects of the condo on behalf of all of the owners. The condo board is usually elected for one or two years. Board members are rotated through the positions of the condo board. The condo board positions usually include a president, vice president, treasurer, secretary. Also any other special board members that may be required. An odd number of board members usually works best when it comes to a vote.

Their responsibilities are quite varied. However the main ones are to set a budget for the upcoming year for both the operating expenses of the condo and the reserve fund. Which is money to be set aside for all major construction and all major repairs. The timeline is over the next 20 years for the condo property and the building.

Additionally they have the responsibility to manage and hire the property manager. The property manager will implement and carry out all of the operations of the building. They also are responsible to report back to the owners collectively at an annual board and condo meeting. They report the status of the budget, the actual operating expenses. Also any special needs or issues that must be addressed or raised by any and all of the owners.

Condo Boards Role – Summary List of Responsibilities

The following is a partial summary list of all of the responsibilities that the condominium board will be accountable for:

  • Set a budget
  • Manage property manager
  • Monitor spending
  • Determine priorities
  • Call AGM
  • Resolve owner issues
  • Set reserve fund budget
  • Special assessments if needed
  • Gain approval for major projects
  • Interface with Owners and property Manager
  • Meet legal requirements for condo

Condo Board Size and Other Practical Issues

At a minimum there needs to be at least three members on the board. In addition the members of the board from a practical perspective need to hold the positions of President, Treasure and Secretary. The board members hold their positions for at least one year. They often will rotate through the positions if they are on the board for longer periods. Some condo boards will have added members on the boards. They will be there to represent various factions and have a variety of responsibilities on the board. There should always be an odd number on the board so that there is never a stalemate on a vote.

From a practical perspective it is often very difficult to get people to go on the boards of condos. As a result some people will remain on the board for years. This provides for lots of experience and for entrenched positions on various topics. Owners participate. Ensure that their investment is being properly managed. Occasionally new people will offer their services on the board. Elect new board members to replace the board.

Rotation of Board Members

Rotate board members on a regular basis. But never all of the board members at the same time. It is very helpful to have experience on the board. Particularly on large complex properties with a combination of rental units and owner occupied units. These situations represent a more complex arrangement. Sometimes require unique solutions for various issues that manifest themselves between tenants and owners. Often there will be two sets of property managers as well. Which further complicates the situation. One Property manager is responsible for the building and all of the common elements. While the other is responsible for the tenants and the interiors of the rented units.

Condo board members are never paid for their services. However any expenses that they might incur as a result of their duties is usually paid after submitting an expense form covering the cost and explaining what the charges are for. This is a pretty standard procedure with most condo boards.

Property Management Online

Property Manager OnlineAs with all businesses these days, the property management business is also going online for both employees as well as tenants and investors. Property Management Online is a major trend. It is impacting all businesses and if your property manager is not heading in that direction it is time to find out why. You could be receiving much more up to date information in real time. This also decreases costs over all and allows the owners to keep closer tabs on just about everything.

Online Information for Investors

Investors can look at all of the reports on line regardless of where they are simply by logging on a server or CRM system that the property management company will provide access to. They will be able to see their income statements, expense statements, and all reports. The modern property management online company is now providing these kinds of services. In addition they should be able to review work orders and the status of these orders. In situations where there are multiple investors or owners, a limited number of people may have access to ensure security and privacy levels are maintained. For example the board members might be the only ones with access or someone who is designated the job of keeping tabs on the property manager.

Online Information for Employees

Property management employees can also update the CRM system so that management can review the results. Review work orders that need to be completed. In addition review the status of all of these work orders. View all  information associated with an apartment or facility. This makes it easier for everyone to understand what is happening.

This also provides a record of the activities associated with a particular unit. Review at one glance all work orders for a given unit. In addition review the history of the work completed. This is a good way to determine if a rental unit has had more work than others completed. The same applies to common areas or the outdoor facilities. It is information that many owners and investors find helpful, but for property managers it is invaluable to them. This information helps them do their jobs better and reduces the cost to manage the building over all.

Corporate memory has long been relied on to manage apartment buildings and town houses as well as commercial properties. There may have been lots of paper records available for someone to dig through. However when it came to finding out what was really going on, you spoke to the superintendent of the building. He or she could always provide anyone with an up to date report of just about everything that was happening.

What If You Lost Your Superintendent

But what happens when the superintendent leaves for whatever reason. All of the real time corporate memory goes with them. This can be a large problem if there are also no accurate records to fall back on. Accommodate many small invoices for repairs. If there is no record of them how is anyone really other than the tenant supposed to know.

Also if a tenant was asking for something to be completed in their unit and was turned down for some reason,  there is an online record for a new superintendent to look at. They can make a decision on better information, rather than just listening to the tenants side of the conversation. There might have been a good reason the request was turned down by the previous manager.

Tenant View of Online Property Management

In some cases tenets of property buildings apartment buildings will also be able to log on the CRM system and view the status of work orders associated with their unit only and any common areas of the building. This provides him with a status update and helps to manage the expectations associated with the apartment.

Estate Manager

Property Management InformationAn estate manager typically looks after the financial planning of the estate and the administration of the estate of the deceased person. Specific types of estate managers may also look after significant property assets. These assets may consist of investments in the markets. They may consist of property that must be managed. Or they could consist of business interest that must be kept running. We may not all have a home like this one. But our estates are still worth something. Manage these assets properly according to your wishes. Many employee jobs may be at stake. Along with their livelihood and their families if there is a company of some kind involved.

Estate Manager – Property

The property manager or estate manager must account for all income from tenants. Account for all expenses for the property. Provide reports showing the income statement. Which outlines the income and expenses and the resulting profit and loss situation for the property. Delegate work to the property management company that was originally in place. The estate manager may only need to liaise with them to keep everything running smoothly.

They must also be well acquainted with the estate planning techniques. As well as property management in the city or state or province that you live. There are significant requirements for estate managers who are also property managers.

Hiring Property Managers

Many estate managers will hire property managers to look after the property assets. There may have been a contract in  place for example with the deceased and the property manager. Update contracts as needed.

The skills required are typically not something that many estate managers possess themselves or within their company. The services will be contracted out and it is important for the administrator to understand this. It is also important for the heirs of the estate to appreciate the complexities of the estate.

Who Can Be Estate Managers

In the vast majority of cases, the estate manager is a member of the family. Wind the estate up in an organized fashion with the guidance of the lawyer for the family. Also the accountant if there is one. Pay all taxes from the estate. As well as from the deceased income prior to their passing.

If the estate is complex and significant value, some families will opt for an unbiased estate manager. The fees associated with this sort of service is expensive. But sometimes warranted based on the skills and services that are provided. If there are many assets it may be necessary to hire an estate manager. They will look after all of the details. Families need to be prepared to either do the work themselves. Or to hire a professional and pay the required fees.

It is also an emotional time. It is difficult to make decisions that involve family heirlooms as well as investments and property. Someone who is separate from the family and not emotionally involved is sometimes better equipped to handle these affairs. They can make recommendations regarding various decisions that need to be made.

Finally the services that many people need are legal advice. They also need accounting advice, investment advice and tax advice. The advice should cover the best approach to managing the estate as well as winding up the estate. Pay the tax man as well. Unfortunately this is one of the things that a lot of people forget about. They then find the estate owes more money than everyone thought.

Property Manager Qualifications

Property Manager QualificationsWhen you hire a property manager, property management qualifications must be taken into account, in addition to many other attributes. For example the cost is an obvious one. The experience level of the property management team is another. The services that they will offer to you are another. This assessment can sometimes be quite difficult. It can take a lot of time with competing interests and different opinions on the board. However the important thing is to do a thorough job. In the end everyone agree on the best company for the job. Ask for other properties that are being managed by this company. Interview the owners to confirm service levels etc and other areas that you may be interested in.

Condo Board Decisions – Property Manager Qualifications

Prepare for interviewing property managers for the job of managing your property, or condominium as part of a board decision. It is important to make sure that you list all of the criteria that you are going to use to rate each property management firm.  The board must review and agree to the requirements. Everyone will have a variety of opinions. It may be difficult to reach a consensus. But better to do this before the request for proposal is issued than after. The board needs to make sure that all of the requirements are included that satisfy everyone. Otherwise it is back to the drawing board and a waste of everyone’s time.

Property Manager Qualifications

The property management qualifications include services offered. Also price for those services, experience levels and knowledge of the current conditions of your property. There are also legal requirements in the jurisdiction where you live.

Some board members, and owners will prepare a spreadsheet listing all of the services and features and costs. They will write down all of these requirements. They will rank the level of adherence to each of the criteria that they are looking for. Some issues have more importance than others. Give these a high-ranking. It is much easier when everyone has discussed and agreed to the rankings ahead of time.

Document everything including all decisions. They should  have a detailed list of criteria that they will use to rank and interview property management companies. This is protection for both the board itself, the property manager and of course the owners of the property. If the board does not take this step and the property manager they hire fails or does not perform, at least you can go back to the documentation to confirm where you went wrong. This is one way to avoid the same mistake the next time around.

Services Included

The services that are included will depend on whether this is an owner occupied building, a rental building or a mixed use building. Each group has different objectives and it helps to keep them separate.

For example the condo board is responsible to the owners, whether they live in the building or rent their units out. They may need a separate company to manage the rental of the units and the maintenance of the interior of the units. It is not a good idea to have the same management company managing the condo and managing the rental portion of the business. Sometimes there can be some cost savings, however the job of managing a condo is much different from managing a bunch of rental units.

In mixed use buildings there will often be a condo board to manage the condominium corporation and another board made up of owners who rent their units. This second board will be responsible for managing the tenants and the property manager responsible for the interior of the rented units. This board may also represent this subset of owners on the condo board as well.

There can be some conflict in these situations since rental unit owners do not have the same objectives at all compared to people who own their units and live in them.


Qualifications for Property Management

Weekend House WatchersThe qualifications for property management are pretty loose. Just about anyone can set themselves up as a property manager. The big companies and the serious companies will have trained professionals on staff and people with lots of experience. Some of the smaller companies will hire just about anyone who has had some experience. You need to have experience dealing with tenants. Someone who is handy at looking after property or is available for the job.

Smaller companies and startup property management companies may be light on both experience and qualifications. In addition the board or owners of the property may also not have a lot of experience. They are depending on the property management firm to have the qualifications. They need experience to help them  keep everything legal as well as run the property efficiently and cost effectively.

What are the Qualifications for Property Management to Look For?

The questions most owners of rental buildings and condo board members ask themselves is what should we look for when we hire a property manager. What services should we expect. On the other hand these companies have an objective to keep everything running smoothly since that maintains their income. But at the same time they want to keep their costs to a minimum.

Many condo or apartment management companies will charge a flat rate per apartment to rent out the unit, to manage the unit and collect the rent. Some will charge a finder’s fee for renting a unit while others will include this cost as part of their per door fee.

Attending board meetings or owner meetings may be included in the per door fee or they may be extra. Collection services and attending court proceedings may also be included for those situations where tenants skip town and do not pay the rent.

Your property manager’s expertise and qualifications may be a factor in this equation.

Qualifications for Property Management – Government Requirements and Restrictions

Some government jurisdictions are also enacting laws requiring boards and owners to take courses to train them in these areas. They do not always have much of a say in many decisions. The idea is to educate the board, investors and property managers on the functions of a condo board. This includes regulations regarding renting of units and the functions of property managers. The objective is to help everyone avoid costly mistakes. As well as misunderstandings that could cause difficulty for many owners.

Rent increase legislation is popular in many jurisdictions by politicians who are going after the popular vote. More people rent than there are owners. They do not really care about the investment needed to maintain a building. Rents will be allowed to increase by a calculated percentage each year based on many factors. Rent controls and rent legislation is another area that property managers need to have expertise in.

Smaller Companies

Smaller companies cannot afford to have someone on staff who is familiar with the methodology of how rent increases are calculated. As a result this could be another additional cost. The last thing a landlord wants to encounter is a charge by a tenant that rents have been raised too high. They do not want to have to rescind some of the rent increases. It is costly and looks bad for the landlord.

Check out the qualifications for property management carefully before you hire a property manager. Take the appropriate educational courses to set yourself in a good position.

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Real Estate Sales Management

Certified Property ManagerReal estate sales management involves many different aspects beyond the obvious of selling a home, setting it up for sale and managing open houses etc. for example some clients have to move right away and they leave the home vacant, which in some ways is a good thing since there is typically less clutter. The agent may request that the owner do a couple of things to improve the home. The objective is to enhance the opportunity of selling this house for the price they are looking for. At the same time they must also ensure that the home is looked after if vacant. It must all insurance requirements to keep the insurance valid.

A home should also looked lived in or at least taken care of even when it is vacant. Sometimes a real estate agent must also look after this activity themselves. Or subcontract these services if they want to get the house sold. This is just part of the job on the way to a successful sales career.

These steps include the following:

  • Making sure that the house is clean and neat
  • Possibly staging the home with rented furniture to make it look presentable
  • Arranging or causing to be arranged by the owner for someone to maintain the home while it is vacant

We will discuss each of these in a little more detail. Note that the person selling the home i.e. the owner will have to decide how much of this they decide to do. How much they will look after vs. how much they will ask the real estate agent to do on their behalf. Some agents will automatically include this effort and even furniture rental in their fee. While others will suggest that the owner pick up these extra costs.

Making sure that the house is clean and neat:

The last thing that buyers want to see is a messy home. Which they not only will have to clean if they buy it. But it also indicates a general attitude of not taking care of the home. Your agent will push you to clean up this situation. They may even arrange for cleaners at your cost to come in and clean up after you. The same applies to the outside curb appeal. Nice landscaping, a newly cut lawn and healthy plants indicate that the current owner cares about his or her home.

Possibly staging the home with rented furniture to make it look presentable:

if you have moved and the house is empty it is much harder for a prospective buyer to visualize what the home looks like with furniture in it. Some agents will place furniture and some pictures in the home to help buyers with this issue. They may already have furniture of their own they use for this purpose or they will rent them for you at your cost.  Real estate management may include this kind of staging to help sell a home.

Arranging or causing to be arranged by the owner for someone to maintain the home while it is vacant:

this item is particularly important for people who have been transferred and have had to move before the home is sold. In order to maintain your insurance on your home, there will be specific things that must be done. For example many will ask that the water be shut off and the house checked once a week. Checks more often may be required if the outside temperature is below freezing. Real estate agents want to ensure there are no delays in selling a home due to damage cause by water leaks and other problems that occur from time to time.

Real estate property management can encompass more than just these items, however we decided to focus on those associated with selling a home.

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Residential and Commercial Property Management

Residential and Commercial Property ManagementThe management of residential and commercial properties is similar in some ways and very different in others. If you happen to be a landlord you will want to consider hiring a property manager. Someone who is familiar with managing residential properties. It does not matter if they are residential properties, single family homes, town homes or apartment buildings.

There are various bylaws and government laws that are specific to residential property. Find companies that have the experience. They need to know how to deal with these requirements. The tenants are also very different and have many different needs. They come from various income strata’s and there are also many more of them as well.

Commercial Property Management

Commercial property management can be anything from large corporate malls to large office buildings. They require building upgrades and modifications to meet the customer’s professional requirements. Long term leases with rental guarantees etc would be the order of the day. Competition ruling the rent levels and the services provided. Managers deal with far fewer tenants.

Residential Property Management

Residential property management on the other hand is governed by the rent levels that the market will bear. Along with what increases the government will allow in many cases. There are many more tenants to deal with per building. Perhaps even many owners if it is a multi unit condo. For example with many owners for the individual units. In some cases there may be a group of investors who purchase a building. Then they hire a management company to manage the rental building for them. There will be multiple objectives on one side and multiple needs on the other.  As a result many property managers of residential homes to charge more per door than they would for a single owner building.

Professional Systems

In both cases professional level cash flow tracking systems, asset tracking systems are needed. Also a method of reporting that meets the needs of the owners and / or the board of directors of a condominium board. Condominiums represent another type of property management. The property manager is hired to manage all of the common elements of the building. They have virtually nothing to do with the interior of the units. Some units could even be rented and managed by different property management companies all together. This also adds complexity in terms of finger pointing on some issues.

Hire Experienced People

A property management company must have the right people in place to manage all different sorts of situations and buildings. If you are a customer, paying attention to the kinds of buildings currently managed and the level of skills, reporting etc is important. Talk to current customers of the property management company to confirm satisfaction levels.

The type of information that is needed and provided may be quite different depending on the owners and the property management companies. Also the number one objective is to provide excellent customer service to both tenants and owners. But sometimes you cannot satisfy everyone and that then becomes the biggest challenge of all. Property managers must first make sure they are following the laws, they must be fair and honest and they must answer to the person or group that pays them. Ultimately that is what it comes down to . Do what is right. Be fair to all parties. Make sure that to the extent you can everyone’s expectations are met. If they are not met, you had better have a good reason and a good explanation to explain why it is not the way they would like to be!

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Property Portfolio Management

Vacant Home Property ManagementProperty portfolio management must be considered for those organizations who have a large suite of properties to manage. This may consist of several buildings in several cities. Each city represented by a property portfolio manager. They are reporting as a unit on the set of properties they are responsible to manage. On the other hand for large companies managing properties that consist of rental properties for consumers as well as commercial properties. There may be a different organizational approach to managing these properties.

Divide portfolios into commercial, residential apartment, residential homes etc. It depends on the quantity and the location of these properties. There must also be on site or at least in city property management personal to take care of local details.

Property Portfolio Management

Divide into portfolios that represent types of rental properties. Depending on the size of the company and the amount of specialization that is desired, this could mean the portfolios are divided between commercial and residential for example. Divide commercial by the type of commercial property such as mall or big box type commercial properties. Office buildings that have predominantly office workers with a small amount of store fronts serving that office building.

The type of tenant varies a great deal and the needs of the buildings are very different as well. Note that the property portfolio management approach still requires an onsite property manager to deal with day to day issues and solve immediate tenant concerns and issues, including rental of units and approval of prospective tenants.

Increased Size Adds Complexity

It can become much more complex when you have multiple cities involved. Also a mix of commercial tenants with residential tenants. If a building is predominantly residential with a few commercial stores on the first floor, does the residential property manager look after the commercial tenants? Or does the commercial property portfolio management team look after them? Turns out the answer is probably yes to both.

Local superintendents will look after the entire building. Commercial property portfolio management will look after all contracts with the commercial companies. The residential property portfolio management will view this lease of the space by commercial customers. This is just another tenant in their predominantly residential building. Most companies will need to work through these details. While ensuring that they provide the best service to their customers and maintaining a profit for the owner.

Online Tracking

Online tracking of rents, expenses, work orders etc is further complicated when there are multiple buildings in multiple cities to manage. Senior managers want to be updated each morning with a dashboard.

These could include rent collection status, delinquent rents, outstanding work orders, value of the work orders in terms of cost and so on. They also want to be able to drill down and examine details on any given report.

Data networks that provide connectivity to these systems from corporate offices as well as remote superintendent locations. Rental managers must be able to have access to rental contracts. Also systems that will allow them to track tenants as well as report up the line to senior managers. For larger companies they may even have an IT department to manage everything. This includes email, data storage, accounting systems, PC needs, smart phone needs and telephone requirements.

Every rental property management company needs these services, however the size of the company will dictate how sophisticated the IT system will be. For more posts about property management topics, click here.

Property Management Systems

Property Management SystemsProperty management systems can make a huge difference. In terms of both managing multiple properties and providing information to your clients. Information at your finger tips has been the desired approach for some time for property managers and owners. Property management systems are available online on your smart phone. Many property managers can now answer questions instantly using their smart phones.

Access to rental contracts, work orders, setting up tracking lists and much more are available to the superintendent. But also to the management team responsible to manage the overall set of property investments. These sorts of applications save a great deal of time which in turn saves money.

Property Management Systems – Server based

These systems use to operate on stand alone computers. They now run on servers. Access the information from almost anywhere remotely. From systems that are located at the actual rental building on a wireless basis. Imagine you have a tenant with a problem in their unit. Log the problem immediately. Provide status updates immediately. Also issue a work order to have the issue dealt with right from your smart phone. Report the problem resolved. Also take pictures and transmit them immediately. Close the issue using a smart phone application. All information is available to management and their customers instantly.

Modern property management companies are adopting this software. They are providing their employees with the latest capabilities to their customers or clients as well. Now they can provide online reports that management has reviewed to their clients as well. This changes the total relationship with the customer and the tenants. It makes it much easier to manage all properties.

Dealing with Property Owners

Property managers also must report to their owners. Also to the investors that have invested in the property that they are managing. This is extremely important if they are to retain contracts, year over year based on relationships with the owners. They must provide real time summaries and answers to their issues. They provide up to date and accurate information regarding rents collected, expenses during the month. Also year to date comparisons to the budget are the usual kinds of reports that most investors will look for.

Property managers produce annual reports. It is one of the most important documents. It may be subject to an audit. They provide the information needed by owners to file their income taxes. This information must be accurate and meet all federal tax guidelines. Otherwise owners could end up paying more tax than they would normally have to pay.

Condo boards and property owners often request audited reports. This is to satisfy themselves that all transactions are accurate and allocated appropriately. This provides a sense of confidence to the owners and the investors that their assets are being managed properly. The tax department may also look on claims etc more favorably.

Property Management Systems – Tenants

Many people live in rented apartments. They are dissatisfied with the way their buildings are being managed. They report that some item needs to be repaired and then nothing is done. Not only is it not corrected. There is no record of any report being made. They do not have online access. Use smart phone access to online systems. As a result complete reports immediately. In addition pictures taken and uploaded. Track the issue easily.

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Building Management Services

Vacant Home Property ManagementWhy do owners of registered condo buildings need to have building management services? For both the condo building and building management services for the rental operation of the same building? This is a situation that is actually quite common. Anyone who is either an investor or resident in the building that is a registered condo should know the difference. We will try to explain the difference between the two. In addition hy you need separate building management services for each one.

Basically there is a business entity that is responsible for all of the common elements of the building. This is the condo or the strata as it is referred to in some locations. All owners participate and can vote on various issues that the board of directors will bring to them at a general meeting. In addition all owners are eligible to be on the board of directors as well.

They are responsible for setting a budget, establishing and maintaining an adequate reserve fund. In addition providing the owners with at minimum an annual report of all financial and operational status. The board will usually hire a building management service or property manager to look after all of these things on their behalf.

Building Management Services and the Board

It is up to the representatives of the building management service to fulfill and carry though all of the boards requirements. Provided that they are legal of course. They must comply with the bylaws of the property or condominium. This is a pretty standard example of building management service.

Some Units will be Rented

At some buildings a large number of units may be rented out to tenants. If one owner happens to own these rental units, they may hire a building management service. This company will manage the rental of their units, collect the rent and provide upkeep to the interior of the units. They have no responsibility of looking after the exterior of the building.

They work for each individual owner. In addition they are responsible for managing the tenant or tenants that rent units in the building they are in. Often there are multiple owners who own rental units in the building along with people who own and live in the building. The rental unit owners sometimes will band together to hire one management company. This company will manage all of the rental units in an attempt to reduce their costs overall.

These can be two separate building management services or sometimes they can be the same company. Usually there are different people within the building management company responsible for the condo side and the rental side of the business. There is no business or legal relationship between the condo and any tenants that are renting. Or between the various rental building management services. They are separate entities and all must abide by the condo bylaws etc. Separate financial reports are needed for both entities to ensure that there is no mixing of accounts and payments.

Tenant vs. Owner Issues

Many people find this confusing especially at meetings of the unit owners, however it is important to keep these things separate and distinct. For example if a tenant is causing problems in the building and other owners are complaining, the complaints must be given to the condo building management who in turn will contact the owner of that unit. It is up to the owner of that unit to deal with his or her tenant or the building management company that is managing his or her rental units. The rental building management service will need to then follow up with the tenant to ensure that no more complaints are received.

Hope this helps to explain one aspect of building management service. For more information about building management and property management services, click here.

Building Management Service

Vacant Home Property ManagementBuilding management services provided by property management companies can vary a great deal. If you are an owner looking to hire a company to provide you with this type of service, there are many issues to consider. We will cover a few of the building management service items that owners of single-family buildings all the way up to multiple-unit buildings should consider. You may want to prepare a complete list of services that you require. Then request quotes for these services before hiring a building management service company.

Property Management Service List

The list of possible service items that you may want to consider are as follows:

  • Rental of all units
  • Tenant selection
  • Place advertising to fill rental units
  • Collection of rents and collection of overdue rents including small claims courts
  • Review and check of all units pre-occupancy and post-occupancy
  • Administration of damage deposits and last month rents
  • Repair and maintenance of all interior items to the unit
  • Repair and maintenance of all exterior items of the building
  • Preparation of an annual budget
  • Report on monthly revenue and expenses
  • Emergency response to maintenance items
  • Hiring of on-site managers if needed
  • Management of on-site managers if needed
  • Other specific services to the building that you may require

We suggest that owners who are planning to hire a Building Management Service company to provide these services receive very explicit contract guidelines. They can review and understand them, prior to hiring a company of this type.  The contract should state the specifics of what will  be done in as many specific situations as possible. You may require the company to contact you prior to spending any money over $50 for example in an effort to control the costs. You might provide them with specific guidelines for the kind of tenants you want to have in your building. They will attempt to carry out your instructions provided that they meet local and state laws. Specifics such as time frames, cost, and actions to be completed by a specific date should be included as much as possible.

Property Management Reports

Building manage service and contracts covering these services can be very general. It is always a good idea to check with the company providing building management service to you on a regular basis. Request status reports and monitor financial reports on a monthly basis at a minimum. Once you gain confidence with the company you have hired, you may consider relaxing this level of vigilance. In our experience, it is a good habit to get into where you monitor the expenses and status reports once a month. Letting the building management service know that you review the reports etc will also help to keep them vigilant as well.

Less specific items should also include your rental strategy. For example what is your rent level going to be, how much will you increase rent each month? Will you rent to only seniors or people with kids or people with pets. There are all kinds of rental strategies to consider. You may decide to leave a unit vacant while you hold out for a tenant willing to pay a higher rent and take care of the place. This can mean less damages and lower cost to you the owner and to the property manager as well. Discuss all of these sorts of items with your manager and write them down so that everyone is clear on your strategy.

Building management service can be provided for individual homes, for apartment buildings that are condos. Also for rental units that make up the total building or part of a building. There are lots of combinations and we will discuss one example in our next post about the services that property managers can provide.

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Property Asset Management

Property Management SystemsProperty asset management is an important part of the property management job. Not only is property management responsible for managing  tenants, renting units, paying common expenses and letting contracts to complete repairs. They are also responsible for managing both fixed assets as well as non fixed assets.  Rent units and sign contracts with tenants. In addition collect rents on a monthly basis either by check or by electronic means.

This is the common most understood portion of property management. In addition keeping track of all of the assets is part of the job. Completing an inventory every year or more often if needed is also necessary part of the job. Replace missing items. This can represent an additional cost to the owners. As a result of an inventory audit of the asserts, further action may be needed to investigate chronic problems.

Property Asset Management

Property asset management is another major part of the job. Managers prepare asset reports on behalf of their clients. Management of fixed assets includes repairs, painting, and plumbing etc. this includes both interior and exterior portions of the building. Management of non fixed assets also is needed for assets in common areas of the buildings. Also assets in each unit that is rented and assets that are needed to allow for properly maintain the building.

These items could include tools, ladders, cleaning supplies and supplies typically needed for routine repairs. This also includes items such as refrigerators, stoves and cook tops, dryers, washing machines and dish washers. Common areas might have chairs and tables, a stove and refrigerator in shared common rooms or club houses etc.

Keeping Records

Record repairs and purchases as expenses. The larger items accounted for in the asset management system being employed by the property management income company. This is required to keep track of how much money is spent on various categories. Also for the larger items that  depreciate as well. This is necessary for tax purposes. Take the appropriate tax deductions to avoid paying too much tax under the tax law. Each asset may be in a different tax class. Reflect any repairs and changes accordingly.

Property managers need to have all of this material recorded in the asset management system. In addition contracts between the owner and the property manager must stipulate the requirements for tracking purposes. Don’t forget to include reporting of income and expenses. Make information available to the owners accountants for audit purposes. As well as for preparation of the tax statements at the end of each year.

Manage Contracts

Include  reports on a monthly basis as well as on an annual basis. Most will include rental income, rental expenses, rental records, lease records, and income statements. In most cases the report will include or report the value of assets at the beginning of the period. The additions and removal of assets during the period. Then the value of the final assets at the end of the period. The property manager should also be able to report an inventory of all assets as well.

This is pretty standard for property managers and expected by client owners. Many owners will review these reports regularly as part of their due diligence. They provide an over view of the property that they own. Owners will also query anything that looks out of place and any large expenses that may be reported.

Property managers should be prepared to deal with these questions. They should even provide a narrative report routinely addressing anything that owners may be concerned about. They should be preparing these exception reports as a matter of course. Hence, they should focus on questions that the owner is likely to have. This saves time for everyone.

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Assets Property Management

Property Manager QualificationsMany residential rental property owners are focused on the income and expense side of the equation since this is the primary cash flow that will impact their ability to pay all of their expenses associated with the property that they own. There is another element of property management that needs to be discussed. That is assets property management.

Some units will be rented without furniture. However there may be the basics such as fridge, stove, microwave and possibly a washing machine and clothes dryer. There will be screens on the windows, lights, faucets, toilets and chandeliers. This may seem extreme in terms of asset management. Some property owners have found much to their frustration that these things are missing when they come to inspect after the tenant has moved out.

Assets Property Management

Fully Furnished

At the other extreme, some rental units will come fully equipped with furniture. Beds and bedding, kitchen utensils and basically everything that a person needs to live. All you need to do is bring your clothes. This is a far more complex asset property management situation. As a result there are a lot of items to inventory and keep track of. Tenants look for cleanliness and good quality utensils, clean linens as basic requirements. Property mangers often hire cleaners to go in after tenants leave to clean the place. They will make the cleaning fee a part of the charge for renting the property. In addition to whatever is charged on a per month or daily basis.

In addition there may be other items in or around the property that must be tracked and included in the assets of the property. There are several reasons to keep track of all assets that are in and around a property. These are:

  • Track assets for tax purposes for deductions and depreciation purposes.
  • Track all assets for inventory purposes
  • Ensure nothing is stolen when tenants leave.
  • Track assets from an expense perspective to report on the books for income statements etc

Contract property managers  to track all of these items on behalf of a owner client. Or the owner client may track these things themselves. Use proper tools if the property manager is responsible for this element of asset management. In addition they must record the date of purchase or the date first entered into the record. Also the value of the item and a description of the item all linked to the unit that this asset is located in. Record all additions and removals as well.

Informal or Formal Asset Tracking

Some property managers will perform the function of asset property management informally and use a camera to record everything and perhaps focus on the major items in the home. Others may perform and maintain a very detailed asset property management function. Evaluate the benefits of a detailed inventory vs. the cost of maintaining such an inventory.

Most companies will focus on the major items and leave the details of smaller items to the owner. However asset property management is extremely important  for tax related reasons. Write off assets against income either from a depreciation perspective or from a total write off perspective.

Assets Property Management – Year End Reports

Year end reports will cover income and expenses for the property. These same reports will also show the total value of assets at the beginning of the year, the additions and deletions during the year and the final total assets at the end of the year.

Owners and clients will monitor all of these reports as part of their ongoing management of the property and the services provided by the property management company.

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Property Management Information

Property Management InformationOwners of rental buildings want a lot of property management information from their property managers. They look for regular reports at the end of each month. These include rent rolls, status reports on various activities, annual reports, tax reports for filing with the government. As well as rental reports to substantiate rent increases. Most of all they want to make sure that there are no surprises.

Property Management Information – End of the Month Reports

At the end of each month, property management information should include a total income and expense report. It should show the rental income for the month and the year to date numbers. It should also show the expenses in the same format for all categories.  Rental units rented and the rent collected, end of lease projections, empty units, and collection activities should also be reported. They also want to be made aware of any special issues that should be brought to their attention. For example renters that skipped on their rent. Also renters that are behind on their rent.

Status Reports

There may be various projects and upgrades that are underway. A status report is usually provided to give owners who cannot get to the property an update. Include picture as required. Discuss issues as required.  Some owners will want a monthly meeting to review this information. However more often it will be a quick conference call which saves everyone time.

Annual Reports

Annual reports summarizing the year and projections for the coming year are also needed. In addition these reports allow owners to budget properly. Review every line item and adjust based on inflation. In addition specific needs of the property and even specific agendas of the owners.

Tax Reports

Tax reports are also provided on an annual basis as part of the annual property management information flow. These reports can be provided to accountants. They will incorporate the appropriate cash flows into the owners income tax reports to the government. This is not an audit. It is a tax report based on the information provided to the accountant.

If there is only one owner, discussions and decisions are often very straight forward and can be conducted easily. If there are multiple owners, the decisions take longer. Often a board of directors will interface with the property manager. They will go over all of the property management information. The job of the board is to review all reports and make sure that results are in line with expectations.

Rental Manager

Investment Property ManagementA rental manager for a large property management company spends a lot of time advertising for tenants, interviewing tenants, approving tenants and setting rent levels as well as defending those levels to tenants and government authorities in jurisdictions that have rental controls in place. One of the worst nightmares that a rental manager can have is to rent to a bad tenant. They cause a lot of damage, do not pay their rent and it is hard to get rid of them. Screening of tenants is one of the most important things that a rental manager can do.

Rental Manager – Manage Rent Levels

Rent levels have to be set based on  market conditions. Also the type of tenant you want in your building, the amenities that are offered in your building. As well as the occupancy rate for your building. Rental managers must take all of these conditions into account when setting rental levels. They offer discounts in some cases to tenants as enticements at various times.

Low rents may attract the wrong type of tenant which means you get people who are not good at paying their rent. They do not have pride in the place they live. High rents can sometimes mean that units stay vacant for a longer period. You do not have the rental income. But then you do not have the damages either that many people cause.

Some governments have in place rental controls to avoid rent levels from increasing too fast. They will have prescribed increases that are approved each year. The rental manager must be able to justify their increases and show that they are within the level that has been prescribed by the government regulations. If the rent increases will be larger than allowed, sometimes they can be approved. However substantial documentation must be provided to substantiate the increases that are above the allowed limits.

Balance Income and Expenses

In addition the expenses must be covered by the rental income. There is a balance between income and what can be spent each year in terms of regular expenses to operate the building, maintenance, upgrades and a reasonable profit. This also must be taken into account by the rental manager when setting the rental rates for the coming year.

This is a significant balancing act that most rental managers must deal with in addition to dealing with tenants, reviewing applications and setting contracts / leases for units. There are good and bad tenants at all income stratas. The trick is to pick out the people who will always pay their rent on time and take care of the place they rent for you. No one wants a deadbeat renter.

You even have to be careful of rental managers who will say nice things about tenants merely to get them out of their building because they are in fact a bad tenant. This actually happens much more than you think.

Screen Tenants

Take the time to screen tenants and always use a screening service. The service may cost you some money, but it will be worth it in the long run when you avoid a lot of damage or lost rent when they skip town and do not pay their rent. This is money well spent. In one case we know of, a couple applied to rent an apartment and were in a bad credit situation.

They had over 20 credit cards and were not making he payments on these credit cards. Can you imagine if you rented to them. What do you think the chances are that  they would be able or willing to pay you the rent check on time? There is very little likely hood that they would pay your rent and then you would be facing court costs to get rid of them and collect what is owed to you.

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