In our previous article, What to Look for in a Property Manager - Part I, we looked at some of the ways investors can compare apples with apples to discover what the true cost of a given property management company is - versus just looking at the stated monthly percentage charge.
But that's just one side of the coin. With all services, there is more to consider than price, since the commodity on offer is not always the same. A seat on a plane is a seat on a plane. We all end up at the same destination. Yet when I fly to Europe, I usually fly Virgin Airlines if possible. I pay a little extra because it's worth it to me. And when I get my car fixed, I go to a mechanic that I've trusted for years. He's not the cheapest, he's not the most expensive, but I feel comfortable dealing with him. He's honest. Last time I was there for something I was told by another dealer I needed doing urgently, he sent me away telling me that he'd be happy to take my money, but it really wasn't something I needed to do at all. To me, that kind of integrity is priceless.
The truth is that simply being comfortable with the person who is looking after such a large asset should be a large part of making your decision.
Apart from trust, there are a myriad of other more technical issues to consider: How old is the company? Will they pick up the phone when you call and respond to emails? Are they members of well known property management organizations (like NARPM) that exist in our industry? Will they send you timely statements each month? Do they send out checks or pay by direct deposit? What assistance do they provide in the event of an eviction? Will they make payments to the the home owners association for you each month, if applicable? Is their office close to your property, so that the tenants can get things fixed etc.? You get the idea. Thinking through some of these non-price related questions before making a decision might help you from having to make a time consuming switch down the road.
So while it's relatively easy to compare some of the basic charges, it's much harder to understand the value that is being offered.
To summarize: Initial pricing is one thing, true cost is another, and overall value is what you're really looking for.