How to Hire a Property Manager: Questioning Before Hiring

Owning a rental property can be a lucrative way to build wealth, but it also comes with its own set of challenges. Professional management is especially important for anyone with an investment property, as it helps maximize returns and minimize hassles. Whether you’re a first-time landlord or a seasoned investor, finding the right manager can make all the difference in your experience and success.

Hiring a property manager can save you time, reduce stress, and help you avoid costly mistakes. However, not all property management companies are created equal, so it’s important to compare their services and fees before making a decision. A good property manager will handle everything from tenant screening and rent collection to maintenance and legal compliance, allowing you to focus on growing your investment property portfolio.

Introduction to Property Management

Property management is the backbone of successful rental property ownership. At its core, property management is the process of overseeing and maintaining rental properties to ensure they remain profitable, well-maintained, and compliant with all relevant laws and regulations. For landlords who want to take a more hands-off approach, hiring a property manager or property management company can be a game-changer. These professionals handle everything from marketing your property and screening tenants to collecting rent and responding to maintenance requests. By entrusting your investment to the right property manager, you can streamline the entire process of managing your properties, reduce stress, and ensure your rental business runs smoothly. Whether you own a single rental or multiple properties, a reputable management company can help you maximize returns while minimizing the day-to-day hassles of property management.

Benefits of Hiring a Property Manager

Choosing to work with a property management company offers a host of advantages for landlords. One of the most significant benefits is the potential for increased rental income, as experienced property managers know how to set optimal rent rates and keep vacancy periods short. By hiring a property manager, landlords can also enjoy reduced stress, as the company takes on the responsibility of navigating complex landlord-tenant laws and ensuring full legal compliance. Property managers handle essential tasks such as property inspections, lease enforcement, and detailed financial reporting, freeing up landlords to focus on other aspects of their business or personal life. Outsourcing property management also helps minimize costly mistakes and legal issues, providing peace of mind and a more efficient, profitable rental experience.

Before You Choose: Get Clarity From Your Potential Manager(s)

You’re trying to evaluate which manager you should entrust with your property. You’ll be charged a fee for the service after all, and you want to ensure they are both effective and reliable at managing your property. Now, I will say right off the bat that I am biased toward Streamline for the Montgomery area in Maryland; they are an amazing team full of hardworking and effective managers and administrators. But I strongly suggest that, with whichever manager you do end up speaking with, don’t be afraid to press them for assurances of their quality and consistency in service. If you can’t get the clarity and confirmation you want for your questions with the manager, put them on the short list.

When evaluating managers, careful decision making is crucial to ensure you select the right property manager for your needs. Reading online reviews can provide valuable insights into the experiences of other property owners with specific management companies. Consulting real estate agents and other property owners for recommendations and references can also help you assess the quality and reliability of potential managers. Some property owners choose to outsource property management, and gathering feedback from those who have done so can be especially helpful. Make use of available resources, such as comparison templates and industry guides, to support your evaluation process.

It’s your property, you own its revenues. So where should you start? First, determine your specific needs and criteria for property management before interviewing potential managers. What are the questions you should ask?

Cost-Effective Property Management

While some landlords may hesitate at the thought of paying management fees, hiring a property manager can actually be a cost-effective solution in the long run. A skilled property management company can help you save money by leveraging their network of reliable contractors, negotiating better rates for repairs, and reducing tenant turnover through effective management. Additionally, property managers are experts at setting competitive rental rates and implementing strategic marketing to attract quality tenants quickly, which helps optimize your rental income. By selecting the right property manager, landlords can achieve a higher return on investment, lower their overall expenses, and ensure their properties are managed efficiently and profitably.

Stay Organized in Your Review: Build a Template

At a minimum, build a document or template that lists all the questions and fields you need to fill out to perform your comparison, with a new copy of that template for each PM you interview.

I want to remind you that, despite what others may sell to you, the industry is not yet in a state where you can just evaluate the first PM and move forward with them (For example, you may end up working with the franchisee of a major PM that ends up being a lemon). Engaging a review of multiple property managers is prudent for protecting your personal interests. You should engage five to six property management companies before your comparison.

The Template

01 General Information

Manager’s Name:
Contact Information:
Company/Firm:
Number of Properties/Units Managed: (Knowing how many properties a manager oversees helps assess their expertise and ensures they can provide adequate attention and legal compliance for each property.)
Years of Experience:
Types of Properties Managed (single-family, multifamily, commercial, mixed-use):
Geographic coverage: (Location can impact management fees, cleaning costs, and service requirements, so it's important to understand the areas the manager covers.)

02 Owner Relations & Transparency

How do you proactively update owners on property performance, and what steps do you take to ensure effective communication throughout the process?
What’s your process for gaining owner approval on large expenses?
Do you provide detailed invoices and receipts for all work?
Can owners choose their own vendors if desired?
Do you conduct regular owner review meetings?
How do you handle owner disagreements with your decisions?
In what ways do you help property owners be a good landlord by promoting transparency and offering ongoing support?

03 Communication & Responsiveness

Note: Poor communication is a prevalent issue across property management companies of all sizes. Treat this portion of questioning with special attention.

After confirmation of receipt, how quickly do you respond to owner inquiries? (hours/days)
What communication channels do you provide? (phone, email, portal, text)
Do you provide after-hours/emergency support? How?
Unprompted, how often do you communicate with owners (weekly, monthly, only when issues arise)? Is it an automated message? What is the usual content of this message?
How often do you proactively communicate with the tenant? How quickly do you follow up with tenant complaints?
How do you manage communication with both owners and tenants to ensure responsiveness and effective resolution of issues?

04 Leasing & Tenant Management

What is your average time on market (vacancy period) for rentals?
What leasing fees do you charge for finding new tenants? Are these flat fees or a percentage of rent?
What is the typical turnaround time for cleaning and preparing a rental between tenants?
What’s your screening process (credit, background, employment, landlord history)?
How do you handle lease renewals?
What is your eviction rate in the last 2 years?
How do you market vacancies (platforms, photos, staging)?

05 Maintenance & Repairs

How are maintenance requests submitted (portal, phone, email)?
Do you use an in house maintenance crew or do you outsource maintenance tasks?
What’s your average response time for non-emergency maintenance?
How do you minimize make-ready costs between tenants?
Do you do preventative maintenance inspections? If so, how often?
How do you ensure the house is kept in good condition through regular maintenance?

06 Professionalism & Reputation

Can you provide references from current owners?
What is your average owner retention rate?
Do you hold any professional certifications (CPM, ARM, NARPM, IREM)?
Are you certified by a national association of property managers, such as NARPM or IREM?
What’s the biggest mistake you’ve made in property management, and how did you fix it?

07 Performance Metrics (Quantitative)

Average Vacancy Rate:
Rent Collection Rate:
Average Time to Lease (listing → signed lease):
Owner Turnover (how many owners stop using your services yearly):

08 Technology & Efficiency

Do you offer an online portal for owners and tenants?
How do you track maintenance requests and vendor performance?
Do you provide performance dashboards (vacancy rates, turnover costs, ROI)?

09 Financial Management

How often do you provide financial statements?
Which software do you use for accounting and reporting?
Do owners have real-time access to financials?
How do you handle late rent collection?
Do you provide year-end tax documents (1099, expense reports)?
What is your fee structure (management fee, leasing fee, renewal fee, markups on repairs, hidden costs)?

10 Legal & Compliance

How do you ensure compliance with local landlord-tenant laws?
How do you stay updated and compliant with changing legal regulations affecting rental properties?
How do you handle security deposits (escrow, compliance with return timelines)?
Do you stay current on fair housing regulations? How?
How do you handle eviction processes (timelines, legal partners, cost management)?

11 Final Evaluation

Weaknesses:
Red Flags:

Overall Satisfaction: [#]/10

Would you continue with/recommend this manager? (Yes/No)

What to Expect from a Property Manager

When you hire a property manager, you should expect a comprehensive suite of property management services designed to protect your investment and maximize returns. A reputable property management company will handle tenant screening, rent collection, maintenance coordination, and provide regular financial reporting. They should be well-versed in local landlord-tenant laws, ensuring your property remains compliant and reducing the risk of legal complications. The best property managers also excel in communication skills, keeping you informed about your property’s status and addressing any concerns promptly. By understanding what a property manager should deliver, landlords can make informed decisions and select the best property manager to meet their unique needs.

Red Flags: Stop Considering Them if You See These Signs

Be cautious of companies that:

Cannot clearly explain their fee structure. Always ask about the property management fee, monthly fee, property management fees, leasing fees, vacancy fees, and any additional fees. Make sure you understand exactly what you will pay and what services are included.
Do not clarify how fees are calculated—whether based on monthly rent, rent collected, or other methods. Ensure the fee structure is transparent and designed to help you make more money, not just cover costs.
Have hidden or excessive fees, such as vacancy fees or additional fees for services like maintenance, tenant renewals, or rent collection. Clarify all costs upfront before signing any agreement.
Pressure you to sign lengthy contracts immediately, or present a property management contract or agreement that is unclear or overly restrictive. Always review the property management contract carefully, paying attention to terms, duration, termination clauses, and your legal protections.
Are difficult to reach during your initial inquiries
Have frequent staff turnover
Show reluctance to provide references
Demonstrate poor knowledge of local rental regulations
Have vague policies for handling maintenance or emergencies

Working with a Property Manager

A successful partnership with a property manager is built on clear communication and mutual understanding. Landlords should establish open channels with their property management company, clearly outlining expectations, investment goals, and any specific concerns. A good property manager will provide regular updates on your rental properties, including financial reports, maintenance requests, and tenant-related issues. By maintaining transparency and fostering trust, landlords and property managers can work together to achieve the best possible outcomes for their investment properties. With the right property manager, landlords can enjoy a stress-free, profitable rental experience and focus on growing their real estate portfolio or pursuing other interests.

Afterword: Making the Comparison

The standards set in this document are aimed at being comprehensive and exhaustive. So it’s quite possible that (exclusive of the red flags) each property manager you interview won’t answer each question impeccably. For this, I advise you to compare the total overall satisfaction score across the managers you interview.