So you just closed on your Phoenix investment property and are doing your due diligence to find the best property manager in your area. You've made some calls and everyone has given you a break down of their fees but what can you do to see who stands out from the crowd? Here are the top 5 questions to ask your Phoenix property manager contenders:
1. Do you manually process each applicant or do you let your property management software make the decision for you? Be careful of companies who relay on their property management software because unfortunately the computer can't pick up small nuances in credit reports such as an apartment collection in which only part of the name is listed. In this case you want to be sure that a qualified member of the Phoenix property management team is reviewing the credit so they can do further research with the partial name and previous addresses and/or cities where the applicant has resided to catch undisclosed past due rent and damages. Otherwise you can end up with a tenant who left damages in another city or state living in your home!
2. Can I speak with the leasing agent? If you leave a message do you receive a call back within 24 hours? What kind of questions does the agent ask as part of the screening process? Does the agent set up a time to meet you at the property to tour or are you just given a code? All of these questions can give you good insight into whether your property will be protected while on the market. If the agent doesn't do any screening then anyone regardless of their background (including criminals) can be pursuing your home AND if given a code they won't even be accompanied by an employee from the company.
3. Do they complete a move in inspection with the tenant or do you just hand them a form to complete? Many property management companies give new tenants the keys to your property at their office and then give the tenant a "move in form" to complete and mail back. The issue with this is the tenant can move in, create damages AND then send the form in with tenant caused damages claiming the house was that way when they moved in. You want to be sure that someone from the property management company accompanies the tenant through a documented move in and that both inspector and tenant sign off of the report. This way when the tenant vacates damages can be easily determined with tenant signed documentation of the original condition of the property.
4. How do they handle the Transaction Privilege Tax payments? Most cities in the Metro Phoenix area collect a transaction privilege tax (called TPT) so you want to know whether the property manager is going to file that on your behalf or whether the funds will be sent to you to take care of. Also, be sure to ask how the manager how the lease agreement is structured so you know whose pockets the tax will come from.
5. What is your lease renewal process? Most property management agreements allow for the property manager to execute lease documents on your behalf in your best interest. However, you want to be sure that the property manager is going to contact you first because your situation may change in a year and you may need to sell the property, move back into it or rents may have increased warranting a raising of the rent. If the property manager doesn't communicate options with you than a renewal may get executed without your knowledge.
It is important to remember that as with any service, price is just one component but the actual details of the services and the processes in which the manger utilize are way more meaningful in the long run. Good luck with your Phoenix property manager search!
