An investor’s due diligence checklist for changing property managers
There could be many reasons why an investor might decide that it’s time for the management of their property to change hands. When that’s the case, it’s important to find the right fit and ensure a smooth transition, to eliminate any road bumps for all the affected parties now and down the line.
Property managers at PRD have recently outlined some of the important steps to take when transitioning a property from one manager to another.
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Do your own research
Just like when buying a property, it’s important to seek out informed, independent information to be able to make a good decision about how to proceed with a property manager.
Asking for recommendations from friends or family who also deal with property managers (either as landlords or renters) can be a good way to assess a business or individual’s approach to the job.
Online recommendations can also be handy resources for a landlord’s search for the right property manager to suit their needs.
With a few candidates in hand, it’s then important to meet with the prospective managers. PRD recommends that investors should ask about a property manager’s experience and qualifications, as well as the business’s fees and commission structure during these interviews.
The network also advises that investors should request references and follow up on any contacts that a property manager provides to recommend their work.
Get your records straight
Once you’ve decided on who you will entrust your property to, make sure to get everything that has been agreed upon in writing, including the property management agreement and the fees and commission structure. As PRD reminds: “This will help to protect your interests and avoid any misunderstandings in the future.”
Next, get prepared to transfer all of your property records and documentation to your new property manager.
Keep everyone informed
Given that a property manager can have a material impact on your tenant’s satisfaction, it’s important to manage the transition for them. PRD recommends communicating with your tenants personally throughout the transition process, handing the communication to the new manager once they are in place.
The firm also stresses that it’s important to give your existing property manager plenty of notice, so that they can manage the changeover as smoothly as possible.
Once a new property manager is in place, it’s important to keep track of their performance – this is for your benefit, as well as keeping your tenants happy. Read the reports they provide and communicate clearly if any concerns crop up.
