5 Mistakes Made By Property Managers

April 20, 2016 by Michael Brown

katy property managers must obey equal housing opportunity laws
As a landlord, you rely on your property manager to handle the day-to-day tasks of managing your investment property. While the responsibilities of a property manager can vary depending on the terms of your contract, you likely expect him or her to:

  • Set or suggest fair rental rates
  • Be the point person for any question or concerns raised by tenants
  • Take care of repairs and purchases needed for the property
  • Find and screen new tenants
  • Maintain tenant records

Unfortunately, finding a property manager who can be counted on to take care of all these tasks can be a challenge. A property manager must essentially be a salesperson, marketer, accountant, and customer service professional, all rolled into one!
katy texas property management company and property managers

This post will look at 5 of the biggest mistakes we see property managers make. When working with a property manager, be sure to inquire about how he or she handles the following issues and processes to ensure the best possible results from your investment!

  1. Not having a proper screening process in place

It’s not enough to rely on instinct when taking on new tenants. A formal screening process will help ensure you find tenants who will respect your property and pay on time.

Some of the most important components of a proper screening process include:

  • Criminal record check
  • Credit check (here’s a great primer on how to do this)
  • Character and/or landlord references
  • Rental history (Experian can give you access to rental payment history)
  • Proof of employment/income

This process should be carried out consistently for each new prospective tenant. If you’re working with a property manager, ask for a copy of the screening process they use, and point out any procedures that might be missing.
katy texas tenant criminal background check

Remember that while your manager might be the one responsible for day-to-day tasks, you’re the one who will ultimately have to deal with the fallout from taking on a bad tenant.

For more tips on devising your own screening process, see our post: How Tenant Screening Works And The Things You Must Look At.

  1. Getting too friendly with the tenants
    katy texas realtor relationship with tenants and home buyers

It’s a property manager’s job to maintain a friendly and professional relationship with your tenants. Having this open line of communication is priceless, and can help mitigate the possibility of disagreements and misunderstandings.

However, some property managers fall into the trap of getting a little too friendly. They may even decide to rent to friends or family members. Unfortunately, this can make it difficult for them to enforce rules, and can lead to the tenants’ interests being favored over your own.

Have a policy in place that your property manager may not rent to friends or family members; or, if you work with a property management company, require that another team member be the point person for those friends or family members.

  1. Not following fair housing laws
    katy texas equal housing opporunity

A good property manager will be well versed in fair housing laws. Without an understanding of these important laws, he or she could be acting in ways that put you at serious legal and financial risk.

Fair housing laws require that landlords not discriminate based on race, color, nationality, familial status, religion, etc. Sounds basic enough, but property managers need to be aware of how discrimination can seep into every stage of property management – from advertising all the way to eviction.

For instance, advertising a unit as ideal for “a single professional” may be considered discriminatory against families with young children; as can policies which use age-specific terms (e.g., “No children are permitted in the games room”).

Not sure of your roles and responsibilities regarding fair housing laws? Here’s a great primer from the American Bar Association: 10 Things Landlords Should Know About Fair Housing.

  1. Not keeping proper records/notes

Being a property manager often means putting in long hours, and it’s easy to get caught up in putting out fires (figuratively speaking, of course!). So it’s not surprising that many managers fail to keep written notes or records regarding their properties.

Keep in mind that keeping proper documentation goes beyond the initial application forms and lease or rental agreement. Property managers should also maintain files for:

  • Payment records: This can prove particularly important if a tenant consistently misses payments or makes late payments.
  • Receipts and warranty information for purchases and repairs.
  • Emails/phone calls made: Written communication (email) is always best, as it provides the best backup in case of any legal action.
  • Formal written notices, such as notices to enter the premises, rent increases or eviction notices.

In general, it’s a good idea to keep these records – particularly your legal documents – for a period of 6-7 years. This will help provide you the greatest protection should legal action ever arise.

Looking for a full list of documents you need to maintain? Check out our post: 9 Essential Items Landlords Always Need In Writing.

  1. Not maintaining open communication with tenants
    katy realtor handing keys to tenant moving into home

As a landlord, you count on your property manager to be the main point of contact for your tenants. Many landlords hire property managers for this sole reason: to avoid having to maintain day-to-day communications with their tenants.

Being responsive to questions and concerns will help ensure little problems don’t turn into big ones. For instance, a small water leak can quickly lead to thousands of dollars in repairs if not dealt with quickly.

Here are a few tips your property manager should follow to ensure the best possible communication with your tenants:

  • Ask new tenants what method of communication they prefer, particularly in cases where an urgent issue needs to be addressed.
  • Always return phone calls and emails promptly. This is a huge problem in the industry, and is one of the biggest complaints tenants have about property managers.
  • Set aside time each day to return phone calls and emails. This will ensure urgent issues get addressed as soon as possible…before turning into big issues.

With over 30 years experience, we’ve learned a thing or two about effective property management. We take the stress out of property management, providing tenant screening, rent collection, repair coordination and much more, all for an affordable flat rate fee. Contact us today to find out what a difference professional property management can make.

Michael Brown

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