Here's a great question to ask when hiring a Property Manager: “Do you own rental property?”
If the Property Manager does own rentals, you should feel much more comfortable.
Why, you ask?
I understand a common misconception out there: If the Owners of a PM Company own rental real estate, they will steer rental prospects towards their properties first. I get that fear but, in most organizations, it's truly unfounded.
The reality is that owning rental real estate is a huge plus for both the customer (you) and the Owner of a PM Company. I own a Property Management Compnay and I've also owned rental properties through Indianapolis for much longer. Without question, owning and managing my own rental properties has provided me with tremendous experience that I've been able to leverage with all of my customers.
We all understand that rental real estate is a real business. Cash flow, particularly with single family homes, is oftentimes extremely tight. So, you need a Property Manager that can make good decisions. Bad decisions can eventually lead to trouble and trouble often leads to a lot of wasted time and expense for both the Property Manager and Owner.
When members of my staff bring me conflicts, I always try to look at it from both the Owner and Tenant points of view. Specifically, I ask myself, “If this was my property, how would I want it handled?” Trust me, you will not get that kind of insight from a Property Management company that does not own rental real estate.
Again, back to making good decisions … there are very few times that my staff has brought my questions that I could not answer. Or, more importantly, bought me issues that I had not personally experienced with my own Tenants or properties. So, I can leverage that background to make the right decision quickly, which saves everyone time and effort.
Do not get me wrong … there's no question I've made my fair share of bad decisions, but most of those bad decisions were very early in my investing career and I only ended up hurting myself, not a customer.
As for steering prospects to my properties … well, that just does not happen. The real estate I own, in almost every case, does not compete, from a price point, with our 3rd party customers. So, if a Tenant prospect is looking for a 4 bedroom in Fishers, I will not have anything to offer.