A landlord’s utmost asset is an excellent property manager. Especially, for a long-distance landlord. Therefore, knowing how to hire a property manager in California becomes essential.
But, don’t just hire any property manager.
California property managers include self-employed individuals and small to large property management companies. They often specialize in representing different types of landlords. For instance, small (mom and pop) landlords with one or two units, medium-sized landlords with one or a few duplexes or triplexes, and large landlords owning one or more apartment buildings.
Therefore, depending upon your number of units and rental locations you may find individual property managers or companies that may fit your needs.
How to Hire a Property Manager in California
Here’s a guide showing you how to hire a property manager in California. Read how to:
- Network with experienced landlords;
- Find local real estate investors associations and forums;
- Learn how to research property managers;
- Understand what property management fees include;
- Learn the right questions to ask when interviewing property managers; and
- Find useful resources about property management.
Above all, read our suggestions below to help you with hiring a California property manager.
Join A Local Real Estate Group
Networking with other landlords provides experience, knowledge, tips, and references for property managers. Also, which property management companies to stay away from.
For example, view these links to the five largest national real estate investors associations.
BiggerPockets, a 1.3 million members community of real estate investors offering many free resources.
Check out BiggerPockets Forums offering major U.S. metropolitan communities forums so members ask questions and share ideas and new trends.
City-Data.com, based in Illinois, offers a social networking platform for the U.S. real estate industry. It offers data and real estate information.
See the City-Data.com Forum: Where renters and multi-housing investors asking questions. You can answer with a post reply or click on the poster’s name to leave a direct message. Also, create your posts with news about local housing, market trends, etc.
The InterNations organization allows global expatriates living in foreign lands to meet and network. Branches in 420 major cities where expats receive advice and tips about living in their new city.
InterNations Forum lets members post and answers questions about living in a particular city and country.
Connected Investors, a real estate investors marketplace and community to connect with a network of local and national real estate entrepreneurs.
The Connected Investors Forum helps new real estate investors to learn from the experts (including San Diego)
Most importantly, extra resources include:
- A search for individual investors;
- Searching for investors groups; and
- A search for real estate investment companies.
National Real Estate Investors Association
National Real Estate Investors Association (NREIA) with 120 local chapters nationwide. Offers support for apartment associations, landlords, local investor associations, and property owner associations.
Likewise, their national forum covers all sorts of real estate investing topics.
San Diego Real Estate Forums
WeLease provides property management services for the greater San Diego area.
Therefore, here are links to San Diego real estate investors’ forums:
- InterNations San Diego chapter with a monthly get-together event for global expats living in San Diego. Their forum gives members advice about living in San Diego;
- Connected Investors allows you to search for real estate investors in San Diego where you find local investors to network with;
- Professor Piggington provides San Diego housing market news and analysis. Its forum contains many topics about San Diego housing, investing, mortgages, loans, etc.;
- San Diego Creative Investors Association (SDCIA), the largest association of real estate investors in San Diego. Also, a chapter of the National Real Estate Investors Association (NREIA). The SDCIA Forum includes many topics about San Diego real estate investing;
- BiggerPockets San Diego real estate forum where members pose and ask questions about San Diego real estate investments; and
- City-Data.com San Diego Rentals Forum, especially for San Diego.
Avoid the Cheapest California Property Management Companies
As an old saying goes, “You get what you paid for”. As a result, hiring the least expensive property manager does not mean better. If you want the best, expect to pay more.
Therefore, by the time you decide you need a property manager, you should know how much income to expect from your tenants. Now is the time to consider how to budget for necessary expenses.
What California Property Managers Charge
Most property managers charge a percentage of the rent. In San Diego, average property management fees range from 5% to 10% of the monthly rent. Yet, the percentage varies depending on how many units you need managing, locations, and the types of services included in the fee.
Others may charge you a flat fee. But, the fee also varies according to the same circumstances described above.
When contacting property management companies ask about included services with the percentage fee (or the flat fee). Especially, when the percentage (or flat fee) is on the low end. Don’t hire a company that hides their “extra” services fees and ends up nickel and diming you. Know all the costs upfront.
Moreover, extra services not included in the basic percentage fee often include:
- Administration fee;
- Advertising fees;
- Bookkeeping fees;
- Cancelation fees;
- Extra inspection fees;
- Lease renewal fees;
- Maintenance surcharges; and
- Set up fees.
In short, it’s important to know all hidden fees. Always ask, “What services does your percentage (or flat) fee include?”
Check Their Qualifications
Every state maintains requirements that property management services must follow.
In California, property managers must hold a real estate broker’s license from the California Department of Real Estate. They must follow all real estate laws or face license suspension or revocation. The licensed broker must supervise all employees.
How to Check a California Property Manager’s License
California compels persons or companies who lease the real property as an agent to become licensed (California Business and Professions Code § 10131-b).
Californians suffered from unlicensed property management companies and property managers in the past. So, the state makes it easy to verify a person’s or company’s license. Also, if the state disciplined non-licensed persons or companies.
Follow these steps to search for a California property manager’s license:
- Go to the California Department of Real Estate website’s Public License Information web page. Enter the last name and first name of the licensee, or company name;
- If you need help finding the name click on the Name Search Help;
- Search for a real estate broker’s or corporation’s main office or branch address click here; and
- If you want to see if a non-licensed person or company received a Desist and Refrain Order from the state for illegally conducting real estate activities click here.
Ask for References
Always ask for references. Property management companies and property managers should provide you with references when asked.
Don’t be shy about calling other landlords to see what experiences they had with certain property managers. If you joined local real estate groups this becomes one of your networking perks. Ask if they experienced any problems and how they handled them.
Know Your Expectations and Questions to Ask
Firstly, make a list of your property management expectations. Secondly, use your list when interviewing property managers. Finally, organize your list into questions like:
- How do you determine a fair market rental rate?
- How do you advertise rental vacancies?
- If my property is vacant will I pay your management fee?
- How do you screen potential tenants?
- Must I become involved with the tenant selection process?
- How do you handle delinquent rentals?
- How do you handle tenant maintenance and repair requests?
- What do you with emergency requests?
- How long does it take to fill a vacancy on average?
- Will you handle evictions if needed?
- How many units do you currently manage? and
- Will you send me regular reports and updates about my rentals?
Previously, we published several posts here to help novice San Diego investors:
- How to Successfully Manage Your Rental Property;
- How To Get Started As A Landlord;
- Landlord Mistakes Limits Profits (What You Need To Know); and
- When You Need A Property Manager.
In conclusion, follow our suggestions for how to hire a property manager in California. To sum it up, these include:
- Joining a local real estate group;
- Avoiding the cheapest property management companies;
- Checking their qualifications;
- Checking a property manager’s license;
- Asking for references; and
- Knowing your expectations and questions to ask.
In short, learn how to network, investigate property managers, and ask the right questions.
Hire an Experienced California Property Manager in San Diego
Contact us for all your property management needs in the greater San Diego area. We handle all types of landlords.
Steven Rich, MBA – Guest Blogger
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WeLease Property Management Company