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4 Reasons Why Landlords Should NOT Hire a Property Management Company

4 Reasons Why Landlords Should NOT Hire a Property Management Company

Hi, this is Tanya with Envy Property Management. In today’s video, we will be focusing on the reasons why landlords should not hire a property management company. We know this sounds crazy coming from a property management company, but at Envy Property Management, we like to be more than transparent and we understand that sometimes hiring a management company for your investment may not be the best option for you and your circumstances. We want to help you understand how most property management companies make their money, and some things to avoid.

It’s always important to do research on any company that you deal with, especially when you’re hiring a business to protect your retirement fund. That being said, if you’re currently looking for a property manager it’s important to ask questions, take notes, and build trust.

So today I’m going to talk about the top 4 reasons why you should not hire a property management company

#1 - Negative Online Reviews From Clients:

In property management, there are clients (being the owner of the property). And customers (being the tenants of the property). You should avoid companies that have multiple negative reviews online from a client.

If the negative reviews online are made by the customers this is usually a good sign! This means in most cases the property manager is looking out for the client’s best interests. Tenants will leave negative reviews from time to time, especially when they feel they left the rental in “good enough shape.” Then the management company comes in and compares the move-in inspection to the move-out inspection and spends the deposit repairing the items the tenants either damaged or left in a “not so good enough shape.” We find most of the tenant’s security deposits are spent cleaning the property and not so much on repairs. As long as regular inspections are being done on the property during the tenancy, management companies can catch needed repairs during the tenancy and require they be taken care of at that time.

 #2 - How Does the Company You're Researching Make a Profit?:

It’s important that you look at how the company makes a profit. If the business is making a percentage off of every work order that comes in, it’s usually in the property management’s best interest to do work, even if this work may not need to be done. Be sure to avoid any maintenance coordination fees that may be placed on any work that is done from outside vendors. For example, say your water heater needs replaced, and the cost from the plumber is $1,200. Some management companies will charge an additional fee, say 10%. That $1,200 bill now just became a $1,320 bill. Those are some big margins for the business. If this is happening, you have to ask yourself is this someone I can trust and want to do business with? At Envy Property Management, we waive all maintenance coordination fees, we charge you what our vendors charge us, there are no additional fees added to our invoices. 

#3 -Do You Want to be Involved With Maintenance?

If you are a handy person and would like to be involved in the maintenance and repairs on the property, then professional property management might not be the best fit for you. There are likely management companies out there that will allow this, however, this is a great opportunity to open the doors for litigation. Professional management companies will only use licensed and insured vendors whom they trust to be professional and courteous to the tenants when working at the property. Involving the owner with maintenance only confuses the tenants and makes them feel uncomfortable. This type of situation always muddies the waters and then the tenant doesn’t know who to call or what to do when a maintenance issue or emergency arises. This creates a bad experience for not only the tenants but the owner AND the property management company as well.  

#4 - How are Inspections Done?:

Now let’s talk about inspections, what are you as a client getting from a property management company as far as inspections go? How are the inspections being performed? It’s important to always have complete and thorough documentation of the condition of a property. Some companies will just do a quick “walk-through inspection” this means they will walk through the property and report items back to the client. A walk-through inspection does not document anything, if a tenant has done damage it’s important that there is documentation to back up anything that may be wrong. If the "walk-thru inspection" is the method they use, how do you really know what’s going on inside your investment? This is something you want to avoid and for sure a business you do not want to hire.

Thanks for watching today’s video, we hope it had some useful information on why landlords should not hire a property management company. My name is Tanya with Envy Property Management, make sure you subscribe to receive more valuable information about your investment properties. If you have any questions about property management or what we can do to help you increase your return on investment, please call us at 801-337-4337, or visit our website at