How to Deal with Bad Property Management

By: ROS Team

People buy property as an investment, oftentimes to serve as a source of passive income. However, property management can be time-consuming. Most landlords hire a property management company to handle the property instead, with the expectation that the property manager will be responsive and have the requisite experience to do the job.

But if you end up hiring the wrong manager, you run the risk of increasing your workload by managing the manager and the property yourself. Make sure you hire the right people as it has been observed that management companies make the rental of a home impossible to run.

Red Flags of Bad Property Management

Poorly run property management companies end up creating more problems than they solve. Be mindful of some common red flags when shopping for a property management company.

1. Communication

With the world’s current level of accessible technology, there is no good reason to be unresponsive to communication, be it via email or text message. If a property management company begins the professional relationship being slow to respond. It’s more than likely an indicator of how responsive they will be toward your tenants.

If a tenant has to constantly send emails to remind the company to fix an issue in their rental home, that’s a red flag that you’ve made the wrong choice. If you find your property management company is unresponsive or slow in responding to tenants. You should immediately notify the company that you are not happy with their services.

2. Follow Through

Sometimes, the issue is not that the property manager is unresponsive or slow the issue is that they don’t follow through to see that the reported problem is resolved. Tenants often tell stories of property management companies that may have been great in responding to their issues quickly. But then failed to follow up on action items or to ensure any additional work that was required was completed. This often occurs when the management company doesn’t use a system to document and track repair and maintenance requests.

3. Lack of Knowledge of Rental Laws

It might sound shocking, but many companies are not familiar with the laws governing tenant and landlord rights. At a minimum, property managers should be familiar with the major elements of the Fair Housing Act. So that they can be a resource to the landlord as well as the tenant.

4. Catalog of Services

You should consider the property management company’s catalog of available services beforehand. Especially if you plan on hiring them to handle an extensive real estate portfolio. In those cases, it’s a good idea to consider management companies that offer a full range of services.

Research the company to find out whether the management company provides services like rent collection, whether they coordinate repair/maintenance with third parties, and if they conduct tenant screening. Only select the company that provides all of the services you desire to effectively manage your property.

5. Eviction Rate

One of the best indicators of a property management company’s performance is its eviction rate. Tenant screening is one of the most challenging jobs that property management companies conduct, so property management companies that have a more rigorous tenant screening process tend to have a lower eviction rate. The idea is that they’ve vetted the applicants and selected only those tenants with a strong rental history and minimal or no financial concerns.

How to Deal with Bad Property Management

So you’ve seen a few of these red flags while dealing with your current or prospective management company…now what?

Here are some tips on how to deal with bad property management:

Start with negotiation. Sometimes, systemic problems make negotiation a challenge. Talk with the property manager to see if you can arrive at a solution. Weigh the pros and cons of continuing your partnership with the company; if the cons outweigh the pros, maybe it’s time to find new management.
If you have the available time and resources, consider taking on the responsibilities of managing your property yourself. Even if it’s only a short-term solution while you shop for a new management company.
Make sure the new company meets your management criteria use what you’ve learned from your previous bad experiences with property management to derive new effectiveness metrics.

How to File a Complaint Against Property Management Companies

Generally, property managers are responsible for handling all property issues, so you, as the landlord, are well with your right to file a complaint if a management company proves to be subpar. Almost every state has several ways in which renters and landlords can file a complaint. But there may be a way to resolve performance deficiencies without having to go that route.

Talk to the property manager directly. Visit their office and have a face-to-face conversation with them, letting them know your concerns and your recommendations for resolving them. More often than not, the issue gets resolved during this phase.
If the issue doesn’t get resolved, consider reporting the property manager to the property management company.
If problems persist or get worse after reporting your concerns to the property company, it may be necessary to file a formal complaint.

You can file a complaint by:

Filing a complaint with the Department of Housing and Urban Development (HUD);
Filing a complaint with the appropriate city-level housing authorities; or
Filing a lawsuit.

Conclusion

Finding the right property management company takes a great deal of research and patience. But it will prove to be worth it because they are the ones who will be working on your behalf to manage your rental property.

If you find management companies making renting of a home impossible to live in, learn how to file a complaint against property management companies if speaking to the property manager or reporting the property manager to the managing company doesn’t work.

You can report the issue to any one of the departments mentioned above. While it may sour the relationship, the property management company will likely become motivated to resolve any outstanding issues on your property. They will also likely improve business practices to not lose their license or risk damaging their reputation.

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