Partnering with a property management company is one of the best decisions you can make in SFR (single-family residential) real estate investing. However, if your rental property suffers due to poor property management, it can severely damage your income, reputation, and the long-term outlook of your asset.
The rental property company you hire will essentially be representing you to tenants in the market. If they manage your property poorly, it reflects on you as a rental property owner.
What can poor property management lead to? What signs show that your rental property is being managed poorly? And what can you do in these situations?
We’ll discuss all of those topics below.
What Poor Property Management Can Lead To
Poor management of your rental property can cause a list of potential problems — ranging from relatively minor to extremely serious.
The repercussions were significant in the case of the husband-and-wife team of Jayce K. and Dilraba I. These out-of-state real estate investors owned eight rental units, and their prior property managers neglected regular maintenance for as much as 12 months.
That led to deteriorating property conditions, causing much dissatisfaction from their tenants. Luckily, they turned to 1836 Property Management to rectify the situation and turn around their outlook.
If property maintenance goes unaddressed for long periods, rental properties can — in extreme cases — crumble. Even in the short term, neglected maintenance can cause major issues such as mold, leading to bigger problems over the long term, including the potential for leaky roofs, burst pipes, and more.
This is just one example of poor property management, though. It can also cover other areas such as poor communication, late rent collections, and more.
Signs That Your Rental Property is Being Poorly Managed
If your property is crumbling or if your tenants are complaining about major issues with your property, then it may be obvious but a little late to know you have problems with your property manager. However, it’s not always so apparent that your investment property is being poorly managed.
So, what are some of the other signs to look out for if you’re concerned about your property management company? Some include…
- Poor communication: If your tenants complain that they can’t get in touch with the property manager, or if you don’t get responses in one business day, then you’re likely not receiving great property management. Constant communication is essential in real estate investing, especially if you’re an out-of-state investor like Dr. Christopher M., who came to 1836 Property Management after a major communication issue with his previous management company.
- Payment issues: If you’re having issues receiving payments from your property management companies, this is a big red flag when dealing with a property manager. This could stem from many factors, including simple bookkeeping practices that may lead to serious financial discrepancies.
- High vacancy rate: If your rental property is vacant for long periods of time, it’s possible that it could be due to a lack of oversight. Your property manager should be communicating things you need to do to decrease vacancy, including adjusting prices, considering upgrades, and more.
- Extra fees: Are you being hit with extra fees for services you didn’t authorize? With a reputable property management company, you should always know what you’re getting and exactly how much it’s going to cost you.
What to Do If Your Investment Property is Being Managed Poorly
If your investment property is being poorly managed, you must address the situation right away to prevent it from getting worse than it is. As a rental property owner, your primary concern should be protecting your investment to attract high-quality tenants and create sustainable, long-term income.
Take these actions right away if you believe your property is being managed poorly…
- Talk: Reach out to your current property management company to express your concerns. If they don’t address what you say in a way that’s adequate for you, consider changing companies.
- Keep records: Keep records of all examples of poor property management. This could include tenant complaints, response times, maintenance issues, and more. This will help in showing them that they’re not living up to their end of the contract.
- Read your contract: Check to see what the cancellation policy of your current property management contract is. This will help you meet the requisite notice periods of cancellation, and any other requirements, if there are any.
- Do your research: Start searching for a new property management company. Look for a local, experienced, and well-reviewed company like 1836 Property Management.
Work with 1836 Property Management
Poor property management can sink your investment property if you’re not careful. That’s why you must always stay in communication with your partners to ensure that they’re doing the great job that you hired them to do.
In the Austin, Texas, market, 1836 Property Management is a leading rental property management company. We have been helping real estate investors like you for years create impressive returns for their properties.
To learn more about how we can help you, contact us today.
