Are You Cut Out For Property Management? 

Are you a superstar manager, obtaining the highest level of efficiency and profit from your community? Or are there a few areas where your community has room for improvement? Are you the right one for your property? Take this quiz to find out.

1. A Hugh Jackman look-alike saunters into your office, desperate to lease an apartment on the spot. Do you:

1. Forget about the background check and get that tall drink of water a set of keys immediately. He may have a mound of unpaid library fines since 1982, but mercy, can he wear that 5 o’clock shadow!
2. Feel out the situation. You usually run a background check, but your occupancy rate has been subpar. Instead, you do a quick Google search of the guy’s name. Nothing involving a weapon pops up, so you take a chance.
3. Conduct a thorough background check and verification of his earnings, even if this is the most attractive looking person you’ve seen outside of Hollywood. You can run the report for $10 to $40 in a matter of minutes and save yourself a lot of trouble down the road.

2. You live, eat and breathe apartments. In other words, you own and manage your own property. Do you:

1. Send a postcard from your Swiss chalet every now and again. Telecommuting is very en vogue these days.
2. Live two hours away. You can’t swing by on the community golf cart, but you don’t have to buy a plane ticket to get there, either.
3. Stay close to the property. You’re responsible for handling emergencies, maintenance requests and vacancies, and it’s not worth the time and gas to drive for more than an hour every time issues arise.

3. A unit on your property becomes vacant. Do you:

1. Bring in a card table, a few plastic chairs and a hearty stock of Doritos, and voilà, you’ve got the perfect place for a Guys Night Out. Besides, you can always start painting in a few weeks.
2. Let the apartment remain vacant while you finish employee evaluations. If you had a clone you could turn the unit over in a snap, but you’re not Michael Keaton in “Multiplicity,” so it will have to wait.
3. Turn it over in less than a week. Your employees have the skills to do construction and maintenance work in-house and they, like you, realize that time is money. There are never enough hours in the day, but you find the time because you know it’s a priority.

4. Pete, your old college buddy, approaches you in need of a cheap place to live. Do you:

1. Offer him a deluxe apartment faster than he can say “movin’ on up.” Deposit? What deposit?
2. Encourage him to become a resident but don’t roll out the red carpet. Pete’s a good guy and you know he would never try to take advantage of you.
3. Keep your business life and your personal life separate. You want to help, but you also know that, despite his best intentions, Pete is going to expect you to cut him a deal, take rent increases personally and assume you’ll take his side if any disputes arise.

5. A resident tells you a bald eagle swooped down from the sky and snatched her entire checkbook right out of her hands on the way to your office. Do you:

1. Grab your binoculars! It’s unfortunate you’ll have to wait a few extra days to get your money, but it’s a small price to pay for the chance to see a Haliaeetus leucocephalus.
2. Let it slide—just this one time. Everyone deserves a break now and then, even if it’s obvious they’re lying through their teeth.
3. Enforce the late fee. If you believed every excuse you heard, you’d never make a dime. Some stories are valid—and you want to give people the benefit of the doubt—but you won’t let someone take advantage of you. Fees for late car payments, credit card payments or utility bills are seldom waived—the same should be true for rent.

6. You need to hire a contractor to test your property for lead paint. Do you:

1. Forget about it. You hung several flyers around the community instructing children to “avoid eating paint chips.” Isn’t that good enough?
2. Go with the first bid you get. You might find a better deal elsewhere, but you don’t feel like dealing with this project any longer than necessary.
3. Shop around. Contractors can charge whatever they want for a job, so you always get multiple bids for a project. You also agree on an hourly rate ahead of time and agree to pay at cost for the materials to ensure you’re receiving the best value.

7. Mr. Braverman offers to replace several damaged ceiling tiles in his apartment. Do you:

1. Give him a rent discount, a ladder and a handful of Band-Aids.
2. Allow him to do so—but only because he’s told you over and over about how skilled he is when it comes to fix-it projects. You’d never entrust someone without experience.
3. Never allow residents to make such repairs. If Mr. Braverman is injured while hired to do work and you don’t have workers compensation insurance for him, you don’t want to be held personally responsible for paying his medical bills and loss of income.

8. You’ve been presented with an investment opportunity, but the location is questionable. Do you:

1. Buy now, tour later. A few shards of broken glass and some yellow caution tape across the street have nothing to do with the quality of the units.
2. Proceed with caution. After doing some research, you admit the location isn’t perfect. However, investment opportunities don’t come around every day and you don’t want to miss out.
3. Wait until you find the perfect place. Buying properties in undesirable areas with potential crime and vandalism issues can send property values—and occupancy rates— plunging. Avoid cities with local rent-control ordinances.

9. It has come to your attention—courtesy of a very vocal resident—that the hot water was turned off for 20 minutes. Do you:

1. Tell her she should be grateful to have indoor plumbing, period. When your grandmother was a child, she had to bathe in a nearby creek. She also walked to school. Uphill. Both ways.
2. Inform her that the problem—an issue that was out of your control—has been resolved.
3. Apologize for the inconvenience. Although some residents can be difficult and demanding, you know that you’re only going to earn their respect if you treat them well. In doing so, you’ll also encourage them to stay longer, take better care of the property and pay their rent on time.

10. There’s always something in need of repair, but money isn’t falling from the sky. Do you:

1. Hope an industrious squirrel with an affinity for woodwork will fix the broken latticework in the community garden.
2. Go with the motto, “If it ain’t broke, don’t fix it.” You’ll replace appliances once they short-circuit, but you’re not going to invest in preventive maintenance in the meantime.
3. Set aside a percentage of the rents collected each month to cover both planned and unexpected maintenance expenses. If you neglect maintenance now, you’re going to lose residents—and money—in the future.

11. When it comes to lease documents, financial statements, service requests, etc., do you:

1. Toss them. You’ve learned a thing or two from “Hoarders.” It starts with a box of receipts and ends with your cat buried alive under years of accumulated junk.
2. Keep the financial statements but discard day-to-day service requests. Who’s really going to ask for documentation that twice you fixed their leaky faucet in 2009?
3. Maintain full records. You understand the importance of keeping well-organized records in a secure file for tax and legal purposes. Whether it’s the walk-through inspection papers, background screenings, insurance documents or receipts for repairs, you have got your bases covered, especially if you ever end up in court.

12. Hugh Jackman Jr.’s background check came back library-fine free, but his credit score is  below your typical threshold. Do you:

1. Throw some shrimp on the barbie and welcome him with open arms! Credit score, shmedit score.
2. Make a (carefully considered) exception. A recent string of vacancies have taken longer than expected to fill, and all of Hugh’s other information is on the up-and-up.
3. Maintain high rental criteria. Typically, it’s more profitable (in the long run) to lower the rent to attract higher-quality residents who are more likely to pay their rent on time. Sorry, but “G’day, Mate!”

13. Some of your long-term residents never make a peep about maintenance issues. Do you:

1. Celebrate! Residents are like children —they should be seen and not heard.
2. Assume they’ve stayed this long for a reason—their unit is in tip-top shape. If they had a problem, they’d report it.
3. Inspect their units regularly anyway. Some residents are reluctant to report maintenance issues out of fear that their rent might go up. If you don’t do a walk-through every six months or year, you may discover extensive unit damage during a move-out that could have been easily prevented.

14. You’ve just acquired a community and its occupancy rate needs a pick-me-up. You need a marketing strategy. Do you:

1. Get the neighborhood kids to stand on the median strip of a nearby highway, holding homemade “Open House” signs. Free labor in exchange for some pool time!
2. Throw up a few ads up on Craigslist, cross your fingers and call it a day.
3. Experiment with a mix of print, online and mobile marketing. The more places you’re advertising, the greater your brand exposure (as long as you measure your results).

15. When your employees handle company money, do you:

1. Ask them to recite the Girl Scout Law the first time and trust them thereafter. You were a Brownie once and you’ve certainly never lied, cheated or stolen.
2. Keep an eye on new hires. Many of your employees have been with the company for years and have earned your trust and respect. New employees must prove themselves trustworthy.
3. Maintain checks and balances with everyone. You trust your employees, but you also know a lack of accountability creates an opportunity for sticky fingers. Whether it’s stealing quarters out of the laundry machines or keeping late fees while reporting them waived, money goes missing.

16. It’s move-out time, and a resident is upset that he did not get his full security deposit back. Do you:

1. Call Judge Judy. Surely she’ll be on your side, plus you’re dying to hear her say, “I’m the boss, applesauce.”
2. Hand over the remainder of the deposit, no questions asked. It’s obvious the resident punched a hole in the wall, but the customer is always right. Right?
3. Negotiate. You always try to settle disputes without going to court because legal fees are very expensive and most judges tend to favor the residents. In your experience, it’s often cheaper to forgive some debt or refund more of a security deposit.

17. Your property has just been appraised for more than you feel is fair. Do you:

a.    Shrug it off. It’s not like you pay taxes, anyway. (Especially you millionaires and billionaires.)

b. Let out an exasperated sigh and then get on with things. No one likes paying taxes, but what can you do?

c. Appeal property taxes—and remember to file on time. The appraisal
process is subjective and includes factors such as the income a property produces, comparable sales in the local area and costs to replace structures—all of which can change frequently. If you negotiate a tax bill, and you must meet your city’s or county’s deadlines, you may see 10 percent to 40 percent in reductions.

18. You’ve just acquired a property and it’s time to decide who pays for the utilities. Do you:

a.    Decide to kick it old school. If the Amish can thrive without electricity, your residents can, too.

b.    Pay for residents’ water, electricity, gas and garbage expenses. You trust that most people are eco-conscious and will use resources sparingly.

c.    Bill residents for utilities. You could potentially save more than $1,000 per year per unit. Residents tend to consume more utilities when they are not responsible for paying the bill.

Ryan Schindler is Vice President of Marketing for Fast Forward Property Management, based in Petaluma, Calif. He can be reached at 707/766-8100 or ryan@fastforwardpm.com.

Lauren Boston is NAA’s Staff Writer. She can be reached at 703/797-0678.

Are You Cut Out to Be a Property Manager?

Time to add up your Final Score! Count how many As, Bs and Cs you circled.

If you circled mostly A’s: The multifamily industry may not be the best place for you. The same could probably be said for any field involving customer service, responsibility and general common sense.

If you circled mostly B’s: You’re trying, but you’re also potentially exposing yourself to liability. There are a number of areas where you may be able to improve profits.

If you circled mostly C’s: You have the skills and knowledge required to be a great property manager. This is the right career for you!

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