Building management service 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.