Questions to Ask Property Management Companies
Questions for a landlord shortlisting property management companies, covering doors per manager, how fees are calculated, maintenance markups, vacancy performance, and references from owners who left.
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The questions
Each question, and why to ask it
How many units does each of your managers look after?
Why ask it
This single ratio predicts your experience better than anything else in the pitch. Put it to every firm on your list, because the spread between them is usually wide, and ask whether the number has risen in the past year. A manager carrying several hundred units reaches your property only when something breaks.
Who specifically would handle my property, and how long have they been with you?
Why ask it
You are often pitched by an owner or a salesperson and then handed to someone else. Ask to meet that person. High turnover in that seat means your tenant history and quirks are relearned every year.
Is your management fee a percentage of rent charged or rent collected?
Why ask it
Charged means you pay during a vacancy or while a tenant is not paying; collected means the company's interest lines up with yours. Firms rarely volunteer which one their agreement uses, and it is usually one clause.
What else do you charge for, beyond the monthly fee?
Why ask it
Ask them to list it: setup, leasing or tenant placement, lease renewal, inspection, vacancy fee, eviction handling, annual statement. Added together these can rival the monthly percentage, which is why the written fee schedule matters more than the headline rate.
Do you mark up repair invoices or take a percentage of maintenance spend?
Why ask it
A markup turns repairs into a revenue line, which changes what gets recommended. Ask to see a recent invoice as the owner received it, next to the contractor's original.
Do you own, or have any interest in, the maintenance company you use?
Why ask it
In-house maintenance can be faster and cheaper, but it removes the check that comes from competing quotes. Either answer can be fine; an evasive one is not, and it is easy to verify in business filings.
How long did your last ten vacancies take to fill?
Why ask it
Specific recent numbers, rather than an average across years, show current market performance. Also ask what rent those units were listed at against what they let for, since speed achieved by discounting is not the same thing.
What is your occupancy rate across the whole portfolio right now?
Why ask it
A company managing hundreds of units knows this figure. Reluctance suggests it is worse than the local market, and it is the fastest way to sanity-check claims about tenant demand.
How many evictions did you file last year, and across how many units?
Why ask it
Both numbers together give you a rate. A high one points at loose screening. A rate of zero across a large portfolio is unusual enough to be worth asking about too, since it can mean problem tenants are simply left in place.
What did you do the last time a tenant you placed stopped paying?
Why ask it
You want the sequence and the timing: when a notice went out, when the owner was told, what it cost. Companies with a practiced process describe it in days. Others describe intentions.
How many properties do you manage like mine, in type, area, and rent band?
Why ask it
A firm strong in suburban single-family homes may be weak on a small apartment building, or on the compliance rules for your city. Ask for the count, not just a yes.
Are you licensed, and can I see the license number and your insurance certificates?
Why ask it
Most places require a broker or property management license, plus general liability and errors and omissions cover. A company that has these to hand sends them the same day; one that does not is telling you something.
Where is rent held between collection and payment to me, and on what date do I get it?
Why ask it
You are looking for a separate client or trust account rather than an operating account, and a fixed payment date. Vagueness about either is the most common early sign of a firm using owner money for its own cash flow.
Who answers the phone after hours, and are they your staff or an answering service?
Why ask it
An outsourced service that only takes messages means a burst pipe waits until morning. Ask what happened on the last genuine out-of-hours emergency and how long it took to get a contractor on site.
What can you spend on a repair before you have to ask me?
Why ask it
Ask for the figure in their standard agreement, which is often lower or higher than owners expect. Too low and you are approving washer replacements; too high and a five-figure job proceeds without you.
Can I see a sample owner statement?
Why ask it
Reading a real statement tells you whether you will be able to follow your own money at tax time. If income and expenses are lumped into single lines with no invoices attached, expect to spend hours reconstructing it.
What is the notice period to end the agreement, and what does it cost?
Why ask it
Look for the combination of a long lock-in, a termination fee, and automatic annual renewal. Any one is manageable; all three together mean a bad match is expensive to escape.
If I sell the property, does your agreement give you a claim on the sale?
Why ask it
Some management agreements grant the firm the listing or a commission if the owner sells, including to the sitting tenant. It is a small clause with a large price, and it is often left unmentioned.
Can I speak to two owners who left you in the past year?
Why ask it
Any firm can supply happy clients. Departures are the informative set, and a company confident in its work will usually offer at least one, with an explanation of why the relationship ended.
What kind of owner do you find hardest to work with?
Why ask it
The answer describes their real expectations of you: approval speed, repair budgets, willingness to accept a market rent. If you recognize yourself in the description, the mismatch will surface in month three.
Can I have the full agreement and fee schedule to read before I decide?
Why ask it
Send this first. A company that provides both without hesitation is used to owners who read. One that offers a summary and asks you to sign at the meeting is relying on you not reading the clauses about term, termination, and commission on sale.
What authority does the agreement give you to act without asking me?
Why ask it
Signing a lease, agreeing a rent, serving notice, and starting an eviction are all decisions that may sit with the company by default. Find the clause and ask for the dollar and decision limits in writing.
Who is named as landlord on the lease, you or me?
Why ask it
This determines who a tenant sues, who must be served notice, and who appears in court. Both arrangements exist; the important thing is knowing which one you are agreeing to before a dispute starts.
Does the agreement require me to indemnify you, and for what?
Why ask it
Broad indemnity clauses can leave you paying for the company's own errors, including regulatory penalties. Ask them to read the clause aloud and explain what it excludes. If they cannot, have a lawyer look at it.
Where are security deposits held, and who returns them?
Why ask it
Deposits are regulated in most places, sometimes down to the type of account and the deadline for return. Ask which entity holds them and who is liable for a penalty if a deadline is missed.
What reserve do you hold from my funds, and when does it get topped up?
Why ask it
A few hundred dollars held back for small repairs is normal. What matters is whether the top-up comes out of the next rent payment automatically, which changes what actually arrives in your account each month.
Can I place a tenant myself, and what happens to the fee if I do?
Why ask it
Some agreements charge the leasing fee regardless of who found the tenant, and some forbid it outright. Worth knowing if you already have a likely tenant, such as a family member or a returning renter.
How is rent set at renewal, and do I approve the figure?
Why ask it
Look for whether they run a market comparison and whether you see it. Firms paid on rent collected have a small incentive to renew cheaply for an easy life, and rent that drifts below market is hard to correct later.
What are your standing rules on pets, smoking, and subletting, and can I set my own?
Why ask it
Companies apply portfolio-wide policies for consistency, which can conflict with your preference or with a local ordinance about assistance animals. Establish now who wins where you disagree.
How do you handle a fair housing or discrimination complaint?
Why ask it
Screening and advertising are where most exposure sits, and the owner is often liable alongside the agent. Ask what training the leasing staff have had and whether a complaint has ever been made against the firm.
How often does someone physically go inside the property?
Why ask it
Exterior drive-bys are cheap and reveal nothing about a slow leak or an unauthorized occupant. Ask for the interior inspection frequency, whether photographs are provided, and whether it costs extra.
How do you decide between repairing something and replacing it?
Why ask it
Ask for a recent example with the numbers. Companies that always replace are minimizing their own callbacks with your capital; companies that always patch leave you with a failing appliance and a frustrated tenant.
What do you need from me at handover?
Why ask it
Keys, appliance warranties, service records, lead or asbestos disclosures, gate codes, and any existing tenant file. A company with a proper checklist is one that has done this often. A vague answer predicts a messy first month.
What happens to the tenant, the deposit, and the records if I end the agreement?
Why ask it
Ask specifically whether files, ledgers, and the deposit transfer within a set number of days. Slow or partial handover is the most common way a departure turns into a genuine problem for the tenant as well as for you.
What do you not do that owners often assume you do?
Why ask it
Honest answers here include tax filing, insurance claims, capital projects, and dealing with a homeowners association. It is a short conversation that prevents a year of assuming someone else is handling something.
Shortlisting a management company
Practical guidance for the conversation itself
Groundwork before the meetings
Check the license and the complaint record
State real estate or broker licensing bodies publish license status and disciplinary history. Ten minutes there removes candidates faster than any interview question.
Look at their current listings
Their live rental adverts show you the photography, the description quality, and the rents they achieve. This is exactly how your property will be marketed.
Read tenant reviews, not owner reviews
Owners rate communication. Tenants report how repairs and deposits were actually handled, which is what drives turnover and therefore your income.
Know your own numbers first
Your current rent, vacancy history, and annual maintenance spend give you a baseline to test their claims against. Without it, any promised improvement sounds plausible.
Comparing bids on the same terms
- 1Total first-year cost, including setup, leasing, and renewal fees, not just the monthly percentage
- 2Whether the fee is on rent charged or rent collected
- 3Doors per manager, and the name of the person handling your property
- 4Days to fill their last ten vacancies, and at what rent
- 5Repair approval limit and any markup on invoices
- 6Notice period, termination fee, and any claim on a future sale
Warning signs
- A rent estimate noticeably above the others, produced before anyone has seen the property
- No separate client account for rent, or vagueness about where money sits
- Refusal to name the person who would manage the property day to day
- Fee schedule described verbally but not written into the agreement
- An agreement that renews automatically with a termination fee attached
- No owner references at all, or only references you may not contact directly