Property Manager Hiring Guide ebook stacked multiple

A good property management company can easily become one of your greatest assets.

But deciding on a company to protect your investment can feel like rocket science. Gain the knowledge you need to confidently evaluate and hire a property management company.

A woman smiling while holding a phone looking to here computer screen

Indemnification and Boilerplate Items

Continuing the theme from our previous post, here are more items to pay attention to in your property management contracts:

Liability and Indemnification

All contracts will have a section that addresses what the management company can and cannot be held liable for. Some contracts are broader and more comprehensive than others in terms of what the firm requires the owner to indemnify them from. (Indemnify: “To compensate for loss or damage; to provide security for financial reimbursement to an individual in case of a specified loss incurred by the person.” —legal-dictionary.thefreedictionary.com)

To get an idea of what a property management company might ask you to hold them harmless from, here’s an excerpt from a contract with a fairly comprehensive liability and indemnification clause:

Liability and Indemnification:

“To indemnify and hold harmless Manager and Manager’s officers, directors, agents and employees from all claims, demands, causes of action, costs and expenses, including reasonable attorneys’ fees at all levels, and from liability to any person, to the extent based on:

  1. Owner’s misstatement, negligence, action, inaction or failure to perform the obligations of this contract or any lease or agreement with a vendor;
  2. the existence of undisclosed material facts about the Property;iii. Manager’s performance, at Owner’s request, of any task beyond the scope of services covered herein;
  3. Manager’s referral, recommendation or retention of any vendor; orv. services or products provided and expenses incurred by any vendor. Owner is responsible and liable for all contracts and obligations related to the property entered into before or during this Agreement by Owner or by Manager under Owner’s authority under this Agreement. Owner agrees to hold Manager harmless from all claims related to any such contracts. This subparagraph (g) will survive Manager’s performance, termination of this Agreement and the transfer of title to the Property.
  4. Damage to the premises or items missing, switched out, lost or damaged under any circumstances, including but not limited to, theft, vandalism, or negligence of tenant(s) or their guests”

While the contract almost always holds the property management company liable for acts of negligence, as you can see above, they are not liable for the negligent acts of those whom they hire to work on their (your) behalf. While it would be unreasonable to expect them to be responsible for all the actions of the 3rd parties they hire, they should at least be held responsible in the event that they hire someone with a history of bad work that they either knew about it or should have known about. This can be accomplished by adding a reasonable care clause like the one below:

“Arrange for all repairs, inspections, maintenance and cleaning, unless Owner has notified Manager in writing prior to the commencement of repairs to use someone else that Owner has selected, and Owner agrees that they shall pay such third party directly and shall indemnify and hold Manager harmless for payment of same. Manager will not be responsible to maintain Owner’s previously established 3rd party relationships.”

Boilerplate Legalese

The following are common clauses found at the end of many contracts.

Entire Agreement

This provision establishes that regardless of what you talked about with the property management company beforehand, this contract is the final version of the agreement and supersedes all prior written and oral proposals.

Modification

The contract should contain a clause stating that the contract can only be modified by a written agreement executed by both parties.

Assignments

Could the management company transfer their contract with you to another management company without your consent? Some contracts allow for this, so make sure there’s a requirement that your approval is a perquisite for the management company transferring or “assigning” your contract to another firm.

Time Is of the Essence

“A phrase that, when inserted in a contract, requires that all references to specific dates and times of day noted in the contract be interpreted exactly. Failure to act within the time required constitutes a breach of the contract. The general rule is that time is not of the essence unless the contract expressly so provides. As a result, with respect to real estate transactions, the modern view is that time is not of the essence unless the parties have manifested such an intent.” (answers.com)

Governing Law; Venue

This clause determines which states’ laws will govern the interpretation of the contract, and may also specify the jurisdiction (county) in which all disputes are to be initiated and resolved.

Severability

This clause allows the contract to remain valid and enforceable even if a specific clause is found to be otherwise. This way, a legal error in the contract does not require the entire agreement be done away with.

Conclusion

This concludes our overview of property management contracts, as well as our comprehensive series on what to look for when hiring a property manager. We hope that this has given you an objective understanding of the topic, and that it helps you make informed decisions that help you get the most from your property.

Let us know if there’s anything we can do to help! 

* * *

The Realty Medics are the nation’s leaders in “Rocket Science Renting”: Rocket Science Renting is about keeping your life simple by letting someone else handle the complex work of property management for you. It’s knowing that your property is running smoothly, with no hiccups or glitches. It’s hyper-responsive customer service that gives you property management peace of mind. It’s advanced technology that could only be designed by a former NASA engineer like our owner, Ben Sencenbaugh. And it’s knowing that you’re always getting maximum value and ROI for your investment.

Orlando Property Management Hiring Guide

Let us handle the rocket science of renting for you!

CONTACT US

The Realty Medics
10027 University Blvd
Orlando, FL 32817

Phone: (321) 947-7653
FAX: (407) 965-3312

The Realty Medics are the nation’s leaders in “Rocket Science Renting”: Rocket Science Renting is about keeping your life simple by letting someone else handle the complex work of property management for you. It’s knowing that your property is running smoothly, with no hiccups or glitches. It’s hyper-responsive customer service that gives you property management peace of mind. It’s advanced technology that could only be designed by a former NASA engineer like our owner, Ben Sencenbaugh. And it’s knowing that you’re always getting maximum value and ROI for your investment.

A woman smiling while holding a phone looking to here computer screen

11 Questions for Determining if You Need a Property Management Firm

While every investor’s situation is different, certain factors typically predispose owners one way or another.

The following questions will help you determine whether or not to hire a property manager.

1. How far do you live from your rental property, and how frequently can you visit the property on a regular basis?

If you’re close, you might be able to make the regular visits required for maintenance, inspections, collections, etc. Otherwise, the farther you live, the higher your travel time and expenses will be. The longer the distance, the more temptation there will be to NOT keep a close eye on things, and that can be a recipe for disaster. You should plan on making frequent visits, as well as for those middle-of-the-night emergency calls that require your immediate attention. In the long run, is this feasible for you?

2. How do you deal with stress? Do you consider yourself to be a tolerant person?

This is a tough one. We all like to think of ourselves as level-headed and even-keeled, but at the end of the day, it takes a special kind of person to deal with the ups and downs of property management.

Behind the seemingly simple task of collecting rent every month is a litany of unpredictable problems that can push people to their limits. Ask yourself how you would react in the unfortunate event that your tenants:

  • fight with other tenants or neighbors;
  • have domestic disputes;
  • conduct illegal business in the dwelling;
  • throw late-night parties or violate noise ordinances;
  • try to sneak extra people or animals into your home;
  • decide to sue you;
  • trash your property;
  • incite the wrath of your HOA because of repeated deed restriction violations; or
  • refuse to pay the rent because they are a “professional tenant” and know how to work the legal system for the maximum amount of free housing at your expense.

3. Are you currently overwhelmed with your property(ies)?

Managing rental properties can become quickly overwhelming, even for experienced investors. Something always requires attention, and things can quickly get out of hand. Hiring a property manager can help you regain control and restore stability to your properties and your life.

4. How many rental properties or units do you have?

As your portfolio grows, so do your management challenges. It becomes easier for things to fall through the cracks. Investors with large portfolios stand to reap significant benefits by leveraging the efficiencies a property manager can provide. Portfolio size can also constrain investors’ ability to consider purchasing new properties if they’re already maxed out managing their current holdings.

5. How much experience do you have with maintenance and repairs?

If you can’t do it yourself, do you know who to call? Finding reliable handymen and contractors can take a while. In the meantime, you may unknowingly hire people who are unethical, uninsured, do poor quality work, overcharge, etc. Maintenance and repairs are significant components of landlording, and if you question your ability to ensure that the work is done quickly and well, you might want to consider hiring a property management company.

6. How quickly are you able to get your unit rented?

Advertising, fielding calls and showing the unit can quickly eat up your time. But because vacancies can quickly eat into your profit margins, they’re critical tasks. If you question whether you have the skills or time to make this happen, OR if you have historically had an unacceptably high vacancy rate, you may want to consider hiring a property management company.

7. Are you capable of handling the accounting and record-keeping for your property?

From profit and loss statements to tax deductions, this area needs special attention and becomes increasingly burdensome for owners of larger portfolios. Some owners (especially those with a background in finance) will do just fine. Others may opt to hire an accountant to help with the bookkeeping. If you feel like this might be a weak point for you, you might want to consider hiring a property management company.

8. Are you willing to be on call 24/7/365?

It’s important to answer this question honestly, because ignoring emergencies at your property is NOT an option. Your special event, important meeting, vacation or personal crisis doesn’t relieve you of your obligations to your tenants. These emergencies don’t happen all the time, but when they do, you’re obligated to handle them immediately. Can you handle being called at 2 a.m. to fix someone’s overflowing toilet?

9. Are you willing to confront tenants about late payments, and evict them from the property if necessary?

Many new owners dislike feeling like the “bad guy” in a landlord-tenant relationship, so they go out of their way to make exceptions to the rules. The problem: This only invites additional abuses and excuses by tenants. Late payments must be dealt with immediately, and while sometimes a friendly reminder is all that’s needed, other times it can be a very confrontational process that needs to end in eviction. Unlike running a charity, running a successful rental business means enforcing the rules—even if it means evicting a single mother who lost her job and won’t be able to pay the rent anytime soon.

10. How well do you understand the laws governing landlording?

Ensuring that the property is run in accordance with the law is critical in preventing lawsuits and shielding yourself from liability if you’re sued. Familiarity with contracts is also very important, as your rental agreement is the only binding agreement between you and the tenant.

11. From a financial standpoint, is managing your property the best use of your time?

Ultimately, your decision to hire a property management company should hinge on whether or not it fits your lifestyle and makes good financial sense. Individual investors will have to assess the opportunity cost of both options based on their unique circumstances.

Property Management Hiring Guide

Let us handle the rocket science of renting for you!

CONTACT US

The Realty Medics
10027 University Blvd
Orlando, FL 32817
Phone: (321) 947-7653
FAX: (407) 965-3312

The Realty Medics are the nation’s leaders in “Rocket Science Renting”: Rocket Science Renting is about keeping your life simple by letting someone else handle the complex work of property management for you. It’s knowing that your property is running smoothly, with no hiccups or glitches. It’s hyper-responsive customer service that gives you property management peace of mind. It’s advanced technology that could only be designed by a former NASA engineer like our owner, Ben Sencenbaugh. And it’s knowing that you’re always getting maximum value and ROI for your investment.

Areas We Serve in Florida

We’re happy to serve many of the surrounding areas here in Central Florida. Below are the current cities and locations that we operate in. If you don’t see your area listed, don’t hesitate to reach out to us and we’ll see if we can work together.

The Realty Medics Guarantees

We are very proud to be the highest rated and most reviewed Property Management company in Central Florida. We guarantee results and have the lowest rates to support our results-driven philosophy.

14 Day Rental Guarantee

If we don’t rent your home in 14 days you get one month FREE management.

90 Day Money Back Guarantee

If you, the Owner, is unhappy for any reason, we will refund your management fees

6 Month Tenant Guarantee

If a tenant is removed in first 6 months, We find you a new tenant free of charge.

Contact the Realty Medics, who partner with National Association of Residential Property Managers (NARPM), as shown in this logo
Contact the Realty Medics, who partner with Equal Housing Opportunities, as shown in this logo
Contact the Realty Medics, who partner with National Association of Realtors (NAR), as shown in this logo
Contact the Realty Medics, who is a BBB Accredited Business, as shown in this logo
Contact the Realty Medics, who is one of 2018 Orlando Sentinel Top 100 Companies, as shown in this logo
Contact the Realty Medics, who is one of  2018 Orlando Business Journal Fast 50, as shown in this logo
Contact the Realty Medics, with a Fast 50 Award badge, as shown in this logo
Contact the Realty Medics, who is one of  2019 Best Property Management Company in Orlando from PropertyManagement.com, as shown in this logo
The Realty Medics affiliate logos - NAR, NARPM, BBB Accredited Business, Equal House Opportunity, 2018 Orlando Sentinel Top 100 Companies badge, 2019 Best Property Management Company Orland badge, 2018 Orlando Business Journal Fast 50 and Fast50 Awards 2018 badge

CONTACT US

Phone: (321) 947-7653
FAX: (407) 965-3312

LOCATION

The Realty Medics
10027 University Blvd
Orlando, FL 32817

The Realty Medics Orlando Property Management As Seen On CBS News, ABC, NBC, FOX, The CW, Ask.com, Digital Journal, BostonHerald.com