When it comes down to how to hire a property manager, it doesn’t matter if you have lived in Hawaii all your life or are relatively new to the islands. Hiring someone to care for your real estate property investment can be overwhelming.
Should I choose a large firm where I will primarily deal with the help rather than the person I hired or should I choose a smaller firm or individual Broker and hope they are all they claim to be?
When hiring a property manager a good starting point, once you have an agents’ contact information, either by recommendation (preferred) or research, send a quick email expressing your interest and looking for a follow up call from the agent. List several times that would be convenient for you.
If the call does not come within a reasonable period of time, say 24 hours, mark them off your list.
If you get a call back set a meeting time and place, preferably at the property you wish to have them manage. Give them a bit of information on the property when you are speaking with them so they can arrived prepared.
Being on time is important for both of you; it shows respect for everyone's time.
When you are going to hire a property manager arriving at your meeting with a list of questions will keep you on track and help you make this important decision.
You will also want to take along a notebook with any specific interest and concerns to address with the agent. *See list below!
My motto has always been “clarify now or relent at leisure”.
Most of us are in love with our property. After all it took a lot of time, money and taking a chance to acquire it. With that in mine it is important that you keep in mind this is a business meeting. The agent is not emotionally attached to your property, which is to your advantage, so please do not be insulted if some of the information you receive is less than flattering. The agent is speaking from a business perspective and will tell you what his/her experience tells him/her will be required to get you the greatest return on your investment.
A good check-list should include but
is not limited to
(feel free to use mine and add to it as you think of things):
How do you select the tenant's?
Do you do background checks/credit checks?
Do you check their references?
Do you check with their employer?
What does your rental contract with me look like?
What does the tenant’s contract look like?
What do you require of the tenant?
What do you require of me?
How do you collect the tenant's rent?
How and when do I get paid?
What are your charges?
Will I receive monthly accounting statements or on a yearly basis?
Will I get copies of receipts and repair bills?
General Excise Tax: See below "Other Professionals"
Will I need to file taxes in Hawaii if I live in another state?
Will I need a Tax License?
Do I pay the General Excise Tax or can I hire you to do this for me?
Do you hire a repair person when needed or do I?
What is the timeline for handling a repair?
If you hire the repairman will you inform me of the
expense before having the repair done?
If I choose, can I do the repairs myself?
What is an appropriate timeline for me complete the project?
There are many more questions you could and should ask when you hire a property manager, however, this is a good starter list. Be sure to take the time before your meeting to give some thought to what is important to you concerning this property.
This is a good place to mention, do not be pressured to sign on the spot. A good agent will understand you need time to go over the information and paperwork provided to you.
Now to the money--an item you will want to consider is the commission. However, it should not be the basis of your decision. Some agents charge more because they give better service. You are looking for an agent who knows your market, has rental and/or sales experience and is professional with their business dealings.
Some agents will quote you a higher number, for rent and/or sales commissions, without supporting the number with facts just to get you to sign; it rarely works out well. Others will quote a lower price and not carry through on their promises.
Obviously there is much to consider, after all this is a big decision.
Note: Your CPA will be able to advise you of your tax obligations and talk to you about...
Note: You might want to seek out an Attorney for legal advice on things to look out for when renting your property.
Note: It is worth considering having a Professional Home Inspector to set a basis for the condition of your property and if there are any safety issues that need your attention.
PS: There are others that might be specific to your property; be sure to ask when interviewing an agent.
If you have questions not covered and would like answers please email me. I am happy to help you and am always looking to improve my service.
Aloha & Mahalo From Propertymanagerohau.com