The success behind property investment relies in being able to do what needs to be done, when it needs to be done. With that said, being a property owner doesn’t need to be a solo endeavor. Those who have dove into the deep waters of real estate and property investment are aware that many times, more times than not, you will need help.
When you acquire a property, you need to be realistic regarding its management and ask yourself if you can really do it all by yourself or not. Successful property investors are conscious about their limitations and know how much their time is worth, what they can or can’t do, and when it’s time to get help.
1. Get Referrals
A good way of knowing the quality of a specific property management firm is by word of mouth. If you know property owners who have already invested in Panama, ask them about the property management firms they use or the ones they reviewed at the time, and ask them what they like or disliked most while searching.
If you don’t have anyone close you can talk to, then fear not. Take your time to ask different real estate firms about their opinions and referrals about property management firms they would recommend. Keep in mind that everyone will have a different opinion. Therefore, we suggest you obtain opinions and referrals from multiple sources so you can make your own conclusions and hire a property management firm you feel comfortable with.
2. Observe their Work
Once you have a few property management firms in mind, conduct an online search and see how exactly they work. Here a few things to ask yourself while doing the research:
- Do the properties they manage align with my property? If not, will they be able to market it correctly?
- How do they advertise vacant homes? Do I find it attractive?
- What strategies do they use to advertise their properties?
- How many vacancies do they currently have? What is the average time they take to fill them?
3. Scan their Website
Anyone can say they are the “best at something”, but don’t be so quick to believe them. While you are doing the online search, take the time to really evaluate their company website. A few questions to consider are:
- Do you find the website useful and informative?
- Do you find its features attractive?
- How is the interaction and experience with the website? Is it complicated for prospective tenants to find the property listings?
4. Do some Interviews
Before making any final decisions interview your prospects and while doing so, ask them questions to minimize the doubts you may have regarding how they handle a certain topic.
This interview process is a decisive moment for the relationship you may or may not have with the property management firm. Try to meet in person and see what vibes the property management firm’s representative gives you. If you are an overseas property owner you can schedule a video call. The important thing is that you can have a cleared idea of the people you will be working with in the future.
5. Review and Negotiate the Terms of the Contract
Once you have decided for a property management firm, don’t commit just yet. Review carefully the terms of the agreement, if there is something that is unclear or that you don’t agree with, ask about it. If you are unhappy with the answer then move on.
Important things to keep an eye on
- Who is the person assigned to handle your property, your main contact? How will you communicate? Make sure you are able to communicate by various means like email, phone calls, texts, WhatsApp of whatever works better for you.
- Compare the costs with other property management firms. Is it too high, too low or, just right? Fees out of the average price raise suspicions, as they could mean inexperience from the firm.
- How many days’ notice is the property management firm required to give, before terminating the relationship, in case they wanted to? The ideal time is between 30 to 60 days, to give you enough time to find another firm.
- How do they handle repairs? Do they have a steady person to deal with most repairs or do they outsource them, depending on the need?
- How and when will you be receiving you tenants rent?
- How does the firm handle delinquent tenants?
6. Ask about the Tenant’s Agreement
- How much will the security deposit be and why?
- What is the monthly rent and the lease terms the firm offers? Ask how they came out with those numbers if you don’t agree with the proposed amount.
Note: Research for properties similar to yours and check the prices. If the firm is asking for too much compared with the rest, it may sit empty for a longer time.
- Who will the tenant communicate with if they have questions or complaints?
- What are the consequences of breaking the lease and how is the process managed?
Choosing the right property management firm is important, so take your time before making any decisions. Make sure that whichever company you choose to manage your property, will manage it will love and carefully as it were theirs.