Realty411 Magazine Featuring Eric Counts, Credit Nerds | Page 88
Interviewing
Attached is an appendix of Leading Questions that need
to be asked at the interview. They should be sent a couple
days beforehand so the potential manager can prepare
properly. This also projects a businesslike image of the
investor to the manager. This list of questions is not
exhaustive as these will lead into others as the interview
progresses.
Managing the Managers
Property managers typically charge 810% of collected
rents. In other words, they don’t get paid during vacancies.
This motivates them to get vacancies filled promptly. Some
managers charge a “turnover” fee when they rerent a unit.
This is fair because it’s extra work for them.
Some investors see a challenge in grinding the manager
on their pay. This is not an area to push the limits.
Managers who feel wellpaid will manage better. All it
takes is one $6,000 damaged unit to wipe out any perceived
savings. So, pay your managers well.
Another thing is to remember that the manager works
for you. Some managers are firm with their clients about
what they will and won’t do. (They try to treat you like a
tenant!) When they try this, be polite but assertive. THEY
WORK FOR YOU!
Talk to your manager about inspecting your unit(s)
quarterly. They need to get inside, ask about needed
repairs, and assess how the unit is being treated. You don’t
want a $6,000 rehab in two years because the tenant paid
well but ran the place down.
If possible, try to visit the manager from time to time.
Drive by the property first. Try to find a scraggly lawn,
broken window, inoperable car, or something to ask the
manager about when you get to their office. This “surprise
audit” will help keep them from going slack handling your
account. Remember, they work for you, and you are paying
them well.
A final issue is the report(s) you will receive monthly.
Large management companies have professional reports
which load easily into income taxpreparation software.
Parttime managers usually do not. So, you will need to set
up an EXCEL spreadsheet or purchase your own software
and load it monthly. Do not wait for “tax time” for this.
GOOD LUCK!
Bruce Kellogg has been a
Realtor® and investor for 38
years. He has transacted about 800
properties in 12 California
counties. These include 14 units,
5+ apartments, offices, mixeduse
buildings, land, lots, mobile homes, cabins, and
churches.
Mr. Kellogg is a contributor and copy editor for two
national real estate wealthbuilding magazines:
Realty411, and REI Wealth Monthly. He is a recipient of
an Albert Nelson Marquis Lifetime Achievement Award,
listed in Who’s Who in America – 2019.
He is available for consulting with syndication,
turnkey, jointventure, and other property purchasers and
note investors nationally, and other consulting
assignments. Reach him at [email protected],
or (408) 4890131.
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