Five Questions You Should Ask Before You Hire A Birmingham Property Manager
Hey, Spencer Sutton here with gkhouses in Birmingham, Alabama, and today I want to talk to you about five questions you need to ask before you hire a Birmingham property manager.
All right, so if you’re looking for property management, then you probably have a whole bunch of questions, but I want to narrow it down to five really, really important questions, just so that you have an idea when you start talking to people on the phone, you can, like, have these conversations, ask these five main questions, and then if you have any others that relate to that or dovetail off that, then that would be great, too.
But here are five questions you need to ask before you hire a Birmingham property manager.
Question Number One
Question number one I would ask is, “How many rentals do you manage?” Here in Birmingham, that’s going to be obviously vary from company to company.
I mean, when we started in 2008, we had 30 rental houses, like, that’s how many we managed.
So when somebody asked us that question, we had to say, “We’ve got 30 rental houses, and we want your house to be number 31.” That’s how it went back in 2008.
We Manage Closely
Now we manage closer, I think, around 600 or 700 here in Birmingham alone, and then we manage in different cities.
It’s really important to find out, and then you can really determine do you want, like, a smaller boutique property management company, maybe somebody who manages 200 houses, or do you want somebody larger with probably a little bit more systems and processes in place.
It’s totally up to your preference, but asking that, finding out how many they manage, I would say you probably don’t want to go with somebody like we were in 2008 that’s just managing like 20 houses, or 30 houses.
So anyway, question number one to ask, “How many rentals do you manage?”
Question Number Two
Question number two is, “How will you determine my rent amount?”
So that’s a great question. We get asked that all the time. Actually, owners will call and ask us, “Do you determine the rental amount, or do I determine the rental amount?”
And the answer is really it’s gonna be a joint effort. So being experts in the market, I mean, we’ve leased thousands upon thousands of houses here in Birmingham, so we’re going to have a better understanding of the different areas and the market, but you also are going to have a say in this.
If I come to you, and we’re talking about your house in Vestavia or somewhere, and I tell you, “You know what, the market says that we can rent your house for $1,700 a month,” and you come back to me and say, “Well, Spencer, I’d really like to rent it for $1,900 a month,” that’s okay.
Like, I’m not going to push back too hard on that.
We can start it at that $1,900 a month, but just know that what determines ultimately what we lease your house for is going to be market price and then the quality of the product, right?
We’re going to be able to see when people go inside the house. We’re going to get feedback, what they thought about the house.
If the price is too high, we’re just not going to get many showings at all.
However, if we’re getting a lot of showings, that tells us that the price is right, but if they’re not filling out applications, then that tells us there may be something wrong with the house.
A Full Walk Through
If we look at all these factors, we actually do a full walk through of your house before we really say, determine, “Hey, this is exactly what we should rent it for.”
We tell you if there’s things that need to be fixed, but ultimately it’s a joint effort.
We’re going to give you some really expert advice.
We’re going to pull up comps in the area and say, you know, you’ve got a house down the street that’s a 3/2 that’s renting for X amount, that the square footage, the bedrooms, and bathrooms are all going to help us determine a good price for your house.
That’s what we’re going to do. We’re going to pull comps, we’re going to pull from our own experience, probably houses that we manage in the same area.
So that’s how we’ll find, you know, how much to rent your house for, but that’s the second question you need to ask.
The Third Question
The third question you want to ask is, “Do you conduct property inspections?”
Now what I found in my experience is that property management companies, there’s just a variety of ways that companies do this, and so I can speak from our personal experience, we absolutely do an initial property inspection.
If your property’s vacant, we will come out there even, you know, before we lease it or anything and just walk through the entire property.
We will take pictures, we’ll make notes about things that we think are really important, and if there’s anything that needs to be fixed in the house before it’s put on the market, we’ll send you a report and say, “Mr. or Mrs. Owner, here’s the list of things that need to be repaired.”
Now we will tell you if there’s things that are recommended. Now that might be the paint color of a room.
If you have a room that’s painted totally pink for a girl, and we suggest that you paint it a more neutral color, you don’t have to do that, that’s recommended.
However, there could be things that are required, and required is typically going to have to do with the safety and the health of a potential tenant or if just there’s something that is very, very obvious that needs to be fixed, like you have an entire wall that needs to be painted because there’s pen marker all over it.
So we would say, “Hey, this is going to be required to be fixed before we put it on the market.”
We do that initial inspection.
If you want us to, we actually…we offer the ability to do quarterly inspections, so that’s an optional service.
I don’t… I’m trying to think the price right now is around $75 an inspection, but we will go out there once a quarter, we will walk through the house, we will take pictures, we change the air filter, we check batteries in smoke detectors, and then we give that report back to you and say, “Hey Mr. or Mrs. Owner, here’s how the tenant is taking care of your house, and here’s pictures of the filter that we changed.”
If there’s anything that we think needs your attention, we’re going to point it out in that report.
So we do property inspections as an optional service if you want us to, and so some companies may do that, may do it as a part of the management fee, they may do a bi-annual, quarterly, once a year, but that’s a good question to ask, because they definitely have been asked that before.
Every property management company has been asked that before, and to some owners, it’s really important, some owners, it’s not as important.
The Fourth Question
The fourth question we think you should ask before you hire a Birmingham property manager is, “Do you offer any guarantees?”
This is one thing that we have found very important in the market and something that we believe sets us apart, one of the things, there’s three things that set us apart, one of them is we put our money where our mouth is, and this really speaks to guarantees.
We Have Four Guarantees That We Offer.
The first one is we have a 21-day lease guarantee.
So as long as we agree on a rental price, and you meet certain stipulations, meaning that you would allow pets in your home and things like that, we guarantee we will rent your house in 21 days or your first 2 months of management free. That’s guarantee number one.
Second guarantee is just a happiness guarantee, and what that means is you can cancel it any time.
There’s no penalty, there’s no provision that, “Hey, you owe us money if you cancel before the contract ends.”
It doesn’t matter. The ultimate goal is we want you to be happy, and if you’re not happy, we’re not going to keep you in some contract.
So there’s zero penalty to get out of our management agreement. So that’s guarantee number two.
Third guarantee is just a tenant placement guarantee.
So what we’re saying is we guarantee that your tenant will at least fulfill six months of the lease, and if they break it within that first six months, then we’re going to put another tenant in your home without charging you a leasing fee at all.
I mean, obviously, we don’t do it for the entire 12 months, because there’s some things beyond our control, like if a tenant loses a job or something like that and they have to move.
But we do pride ourselves in finding great tenants, and we pride ourselves in keeping tenants in homes for a long period of time.
And then the last guarantee is our maintenance guarantee.
We have a maintenance team on staff for most of our work, most all of our work, and so what we’re saying is we guarantee when they go out and do work for you, if that, the work that they did, if something should happen within the first 12 months, and something breaks that we fixed, because of our workmanship, then we’re absolutely gonna come out there and make it right.
We’re going to fix it at our cost and won’t charge you anything.
We believe, I mean, everybody that we use is licensed and insured in our maintenance department, so we stand behind our work 100%, and that’s why we have that guarantee.
So that’s a great question to ask, “Do you have any guarantees?”
Question number five, last question that you should ask, “How does maintenance work, and are there any markups?”
As I mentioned maintenance just a little while ago when I was talking about our guarantees.
This is a really good one. Some companies have their own maintenance department, some companies outsource everything, and so that’s just one that you need to ask.
Like, we have our own maintenance staff in-house. We feel like we can control the quality of work much better when they’re our employees.
We have the guarantees when they’re our employees, and everybody that we use is licensed and insured, so we’re making sure that all of that is kept up, and it avoids any kind of risk for you as a homeowner.
You know, but a lot of property management companies don’t have that, and so you just…that’s a question you want to ask, and then also, “Are there any markups?”
Now there are markups.
We have markups when we’re using a third-party vendor for something that we don’t typically handle.
If you have a tree that needs to be removed, we have a trusted vendor in town, we’re going to probably call them out there and get an estimate, share that estimate with you, and if you give us approval, then we’re going to have them take care of the work.
We will charge a 10% markup for handling that maintenance request and managing that vendor, and so that’s the way it works with us, and so that’s a really good question to ask just so that you understand.
Also, there’s probably a maintenance limit and a reserve, so anything under $500, I know for us, we go ahead and handle that for you as the owner and the tenant to get them taken care of.
If we believe something’s going to be over $500, then we’re going to stop, we’re going to call you, we’re going to shoot you an email and say, “Hey, Mr. or Mrs. Owner, there’s an issue at the house.
You know, we need your approval before we can do anything. Do you want us to get you an estimate?”
If you want to handle it yourself, you’re more than welcome to. We do have some investors that take care of some of their own maintenance, and that’s perfectly fine.
So find out, just get really, really clear on how maintenance works with the property company that you select.
That’s the end of the video. Those are five questions you should ask before you hire a Birmingham property manager, and I hope that helps.
If we can do anything for you, don’t hesitate to reach out to us. Our phone number here in Birmingham, 205-940-6363, extension 3.
You can email [email protected] We will get back to you as soon as possible whether you email or call. Thanks so much and best of luck renting your home.