As a real estate investor and rental property owner, there’s no more valuable asset than a property manager. But with so many different property management companies and services available, how do you possibly choose the right one? It’s a question worth grappling with and spending some time dissecting.

And, with that in mind, here are five of the most important aspects and considerations to think about when hiring a property management company for your real estate investment portfolio.

1. Reputation and Reviews

Your first step in evaluating potential property management companies should be to look into their reputation. Thankfully, with the amount of information available, digging into a company’s reputation is never more than a few clicks away. 

Begin by browsing online reviews and testimonials. Pay attention not only to the number of stars but also to the nature of the feedback. 

Are there recurring issues mentioned by multiple clients? 
How does the company handle criticism or complaints? 

Pay more attention to the broad brushstrokes that the reviews paint. An isolated five-star review (or even an isolated one-star review) isn’t always the best indicator. Instead, take the average of what you find. In a lot of cases, the three-star reviews will give you the most honest and transparent look at the property management company’s services.

If possible, it’s wise to ask for references. Speaking directly with current or past clients can provide you with a clearer picture of the company's reliability and quality of service. Definitely do this if you know people who have worked with specific property managers in the past.

2. Experience and Local Knowledge

Consider the experience of the property management company not just in years, but in relevance to your property’s type and location. 

For example, a company that specializes in residential apartments may not be as adept at managing a commercial office space. Local expertise is invaluable. A company that’s well-versed in your local market will be better equipped to advise you on competitive rent prices, effective marketing strategies, and legal compliance issues that are specific to your locality. They should understand the dynamics of the local real estate market, including factors like average occupancy rates, rental market trends, and seasonal fluctuations.

In the Houston market, for example, Green Residential is known as the most experienced local property management service in the area. Not only have they worked with thousands of local property owners, but they have connections with hundreds of service providers and companies. This gives you, the client, direct access to them as well.

3. Range of Services Offered

What services does the company offer? Typical responsibilities of a property management firm include tenant screening, lease management, maintenance and repairs, rent collection, and even eviction processing. However, the extent of their services can vary significantly. Some companies offer full-service management, while others may provide a more limited scope. Ensure the services offered match your needs. 

For example, if you're not local or prefer a hands-off approach, you might want a company that handles all aspects of property management. On the other hand, if you prefer to be more involved, you might opt for a company that allows you to take on some responsibilities.

4. Communication and Reporting

Effective communication is crucial in any relationship, and your relationship with your property management company is no exception. Before signing a contract, discuss how the company handles communication and emergencies. How quickly do they respond to tenant issues? How will they keep you informed about your property’s status? Frequent and transparent communication will give you peace of mind and ensure your property is being managed efficiently. 

Additionally, check their reporting capabilities. A good property management company should provide regular, detailed reports on financial performance, maintenance, and other critical areas.

5. Fee Structure

Lastly, be sure that you understand the fee structure of the property management company. Fees can vary widely in the industry, and lower fees do not necessarily mean better service. 

Be wary of companies that offer significantly lower rates than their competitors, as this could indicate a lack of experience or hidden fees. Most companies charge a percentage of the monthly rent collected, but others might have a flat monthly fee regardless of rent income. 

Make sure you’re clear about what’s included in the fee and what services might incur additional charges. It's also wise to compare the fee structure of several companies to ensure you are getting value for your money.

Find the Right Property Manager

Finding the right property manager for your real estate investment portfolio isn’t always the easiest challenge. However, if you take your time, do your research, and avoid rushing into a decision, you’ll eventually find the right option. 

Keep the five items in this article in mind, and remember to be patient!