Keys to Successful Property Management


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Some of my favorites reasons to own investment real estate include Cashflow, Tax Shelter, and Equity Growth. My least favorite part of owning real estate is managing tenants and toilets.

Managing rental properties can be a difficult and disheartening task, but it does not have to be. Savvy investors know the key to creating Hassle-Free Cashflow is professional property management. Developing a working relationship with the right property manager team, takes the hassle out of investing and ensures the cashflow will keep rolling in!

In this FREE sixty minute webinar you will learn:

1) How to set yourself up for success by establishing and communicating metrics of success to your property manager
2) Why your property manager should be the most important person on your investing team.
3) What is and is not reasonable to expect from a great property manager.
4) Three warning signs your property manager is stealing from you or worse!
5) How to interview for a great property manager when you are new to a market.
6) The dos and don’ts of firing your existing property management team.
7) Four property management secrets to improve your profitability and cashflow!

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Keys to Successful Property Management

  1. 1. Keys to Successful Property Management David Campbell Jason Cox Hassle-Free Cashflow Investing Cox Premier Properties
  2. 2. Today’s VIPs (very important points) • Metrics of success • PM = most important person • What is and is not reasonable • Warning signs • How to interview for a great property manager • The dos and donts of firing your PM • Four property management secrets
  3. 3. David Campbell - Founder Hassle-Free Cashflow Investing Real Estate investor / developer / broker Financial educator / author / speakerHouses, condo-conversion, multi-family, winery, resort, office, retail, medical office, production home building Former high school band director Self-made multi-millionaire Faculty Member: Investor Summit at Sea with Robert Kiyosaki
  4. 4. Jason & Melinda Cox Property Managers Cox Premier Properties Over 25 years of combined real estate experienceNational Association of Residential Property Managers (NARPM) Metrotex Association of Realtors Texas Association of Realtors National Association of Realtors
  5. 5. Disclaimer This is NOT legal, tax or investment advice. Educational only. No agency created. No guarantee of accuracy. Opinions of the speaker. Consult your advisor.
  6. 6. ProfitROI = Money + Time + Hassle More profit with less invested
  7. 7. Who is your tenant?
  8. 8. Business vs. Investing Business Investment Real Estate Income Yes Yes Yes Expenses Yes No Yes Time Yes No Maybe People Yes No Maybe Passive No Yes Maybe Specialized Skills Yes No Maybe Hassle-Free No Yes Maybe
  9. 9. Professional PM = Hassle Free Real Estate Income Yes Expenses Yes Time Outsource People Outsource Passive Outsource Specialized Skills Outsource Property Manager Hassle-Free YES
  10. 10. PM Metrics of Success • Timely receipt of payment (by the 10th of the month) • Timely receipt of statements (concurrent with payment) • Invoices from companies actually doing the repairs (with statements emailed to owner or placed in online file box) • Understandable reports • No code violations • No calls from tenants • Manager is readily accessible via phone and email (person directly supervising account / property) within one business day • Vacancy loss (better than market averages) • Property should be marketed as soon as old tenant gives notice • How quick is the property turned over (3-5 days)
  11. 11. Setting Your Management Relationship Up for Success • Manager will help client become educated on market norms • Rent range • Vacancy • Security deposits • New manager and owner and tenant will document property condition to understand starting point • Pick a good manager then let the manager “Do Their Job”
  12. 12. Unreasonable Owners • wants the rent paid to owner on the 1st • wants the rent paid to directly to owner • wants property inspected every 30 days • wants to inspect property every 30 days • wants to personally meet every tenant • wants to approve every repair regardless of size • wants to hold manager accountable for 3rd party vendors • wants manager to finance repair expenses • wants manager to work without reserves • wants manager to make the mortgage payment • wants a totally unique set of protocols
  13. 13. Why is your P.M. is the most important person on your team? • Market Property & Create Revenue • Tenant Screening • Durability of Income • “HASSLE-FREE” Tenants • Minimize Expense / Minimize Liability • Lawsuit avoidance • Code compliance • Interpreting market conditions • Identify “good” properties / avoid “bad” properties • Isolate the owner from HASSLE
  14. 14. How to interview for a good manager • Talk with the broker AND the hands on manager • Member of NARPM? • Are they members of MLS? • Do they have E&O / liability insurance? • Past /pending complaints with State Licensing Authority / lawsuits? • Internal / external accounting audits • Frequency of property inspections • How do they market their property? Online? • Do they encourage tenant insurance? • Do they have a written operations procedure manual? • How do tenant’s request repairs?
  15. 15. How to interview for a good manager? • Who does the leasing and how to they get paid? • How easy is it for a tenant to apply for rent / pay their rent? • Manager’s use of technology / automation. • Manager smokers tend to have lax policies on tenant smokers • Look at manager’s website / marketing from perspective of tenant • Look at manager’s customer service from perspective of tenant • Manger’s plan for continuing education • # of units under management / number of managers / vacancy? • Healthy ratio is 70-200 units per manager if supported by separate accounting, maintenance, and leasing staff. • Is the manager’s vacancy rate beating the market?
  16. 16. How to interview for a good manager? • Does manager have employee drug / criminal screening policy? • Procedures for key and property security • Does the manager personally own rentals? • How do you screen prospective tenants? • How do you market for prospective tenants? • What do you look for in a good property owner? • Penalty for canceling property management agreement? • How does the manager’s handle private documents? • After hours maintenance / emergency response? • Does the PM broker property for sale?
  17. 17. Signs your is stealing from you or worse! • Gives tenant rent credit for doing a repair and then billing the owner for the same repair. • Duplicating expenses over multiple months. • Collecting management fee on tenant security deposit. • Collects the rent and tells the owner it’s vacant! • Co-mingling funds (no broker trust account) • Broker collects deposit at move in then tells the owner they already have it at tenant move out • Bills the owner for repairs that didn’t happen!
  18. 18. Signs your PM is stealing from you or worse! • Manager uses the same service company for every repair • Refuses to provide invoices or all the invoices look identical • Vague or illegible income & expense statements • No utility / landscaping bills during vacancy • Communication from property neighbors / HOA / city • Not providing before & after photos of property • No copies of the lease agreement / renewal • No written management agreement • No BROKER’s license!
  19. 19. Signs your PM is stealing from you or worse! • No move in / move out inspection form • Irregular distribution dates = no management procedures • Failure to communicate late payments / tenant • Lack of fair housing practices • Lack of personal accountability • Stretches the truth when it doesn’t really matter • No bad news EVER
  20. 20. Do’s and Don’ts of firing your existing property manager?
  21. 21. DO’s of firing your existing property manager? • Find a new manager FIRST!!! • Give old manager 30 days written notice (read PM agreement) • Transition on the last day of the month • Have new manager contact tenant and old manager • Let the new manager handle the transition • Make it an amicable experience • Use the poor experience with the previous vendor to make your new relationship start out better • Take responsibility that the OWNER hired a poor manager • Incentivize your old manager to cooperate with transfer
  22. 22. DON’Ts of firing your existing property manager? • Don’t vent at the old manager • Don’t write down anything you don’t want in court • Don’t use profanity • Don’t bad mouth your old manager • Don’t let the tenant use the transition to avoid paying rent • Don’t let the tenant play one manager against the other • Don’t disrupt the tenant unnecessarily • Don’t tell the tenant anything you don’t want BOTH managers to know
  23. 23. Four Property Management Secrets • Be a good owner so your manager will go the extra mile for YOU! • The cheapest _________ doesn’t save you money! • Make sure your market has a lot of management choices. • Use your PM to find property to buy • Change owners not properties • Managers know which owners is struggling • Managers know which properties will rent well • Source of off market deals
  24. 24.• Access to proprietary Investing opportunities• FREE eBooks on cashflow investing, private lending, real estate tax strategies• FREE Training videos for new and experienced real estate investors• FREE Podcast on Hassle-Free Cashflow real estate investing• FREE Blog articles and cashflow investing discussions• FREE e-newsletter with real estate investing tips and investing opportunities
  25. 25. Keys to Successful Property Management David Campbell Jason Cox Hassle-Free Cashflow Investing Cox Premier Properties (866) 931-9149 ext 1 (469) 402-1400