Hey everyone, this is Steve Rozenberg with Empire Property Management. Today we’re gonna talk about is a lot of people ask how much should I even pay for property management services. As you know, as in any business, you have the low-level property management companies that offer just volume, flat bottom service; then you have the upper-end, boutique style that may be made you a little more…they may be a smaller company can offer different services, and depending on your needs and your philosophies, you may want one or the other.
I don’t think there’s a right or wrong way to know if you’re picking the right or wrong company. But what I would say is make sure you understand what the company is going to give you. So, for example, sometimes when a company is a low-cost company, they may do things like they may add on service fees for things, or they may upcharge things, or they may not give good service because, let’s face it, when you’re running a business, you have to have a certain amount of staff. In order to have that staff, you have to have money coming in, meaning revenue. In order to keep good staff, you have to be able to pay them equal wages. If all the same companies have the same expenses, someone is cutting a corner, maybe hacking on more properties with one property manager to where they’re not giving good service to everyone; maybe not doing some things and cutting corners.
So you wanna make sure what I would do is go and check out the Google reviews of the company. Look at them up on Yelp and other things like that. Talk to references. You know, we see hundreds and hundreds of investors, every month, contacting us about how we can help them and how we can even give them good advice, even if we don’t manage their property. We still wanna help them so I would say it depends on what your goals are. Make sure that you’re getting a partner. I always say we are relationship-based not transactional-based, meaning I want to make sure that when I’m working with an investor that they are getting the service that they need not the service that I wanna give them, so there’s a difference with that. If an investor wants to buy 50 houses, that may be a client for me. If an investor wants one house, that may be a client for me. If he wants to buy a commercial complex, that may not be a client for me because I don’t deal with commercial.
So you wanna make sure whoever you’re working with is aligned with what your goals are and that they can carry you because at the end of the day, they are a team. You are part of that team, and I would think that on the property management side, that is not where you wanna cut corners and save costs. You may wanna put that into your acquisition cost and make sure your numbers make sense when you’re purchasing the property, and factor that in, maybe have a conservative number.
For example: every place is different. One place may just charge flat rates, and that’s what the competition does. Other states, other cities may charge percentages, so I would call around, make sure you talk to competitors and you’re gonna see what the average is to know, and just remember cheaper is not always cheaper. I’ve learned that personally, from many personal experiences, before I realized the value of having a good partner that can look on the plus side to actually help you succeed not just where I can shave pennies and save money.
Hopefully this helps. If you’d like to talk to me personally, I’d be more than happy to talk to you. I do not need to manage your property, just to help you. I just want you to succeed and be better at knowing what you’re looking for, and you can give me a call. I can give you a free 30-minute consultation. Visit our property management blog for hundreds of videos to help investors become better informed.