Hiring a Property Manager: What to Ask Before You Sign

Hiring a property manager can take a tremendous amount of day-to-day work off a rental housing provider’s plate. A good manager can handle everything from leasing and rent collection to maintenance calls, accounting, resident communication, and regulatory compliance.

But “full-service property management” can mean very different things from one company to another.

Before signing a management agreement, rental housing providers should understand not only what a company charges, but who will actually manage the property, what authority the manager will have, how money and maintenance are handled, and what happens when something goes wrong.

In Berkeley, local experience matters, too. Rental housing providers operate under a particularly complex combination of state and local laws, and a manager who works regularly in Berkeley should have an intimate, ongoing knowledge of the requirements that apply here.

Before the Interview: Know What You Want to Delegate

Before interviewing property management companies, spend a little time thinking about what you actually want a manager to do.

Be prepared to provide basic information about your property, including:

• The number and type of units
• Current rents and occupancy
• Existing leases and tenancy history
• Parking, storage, laundry, and other amenities
• Known or upcoming maintenance issues
• Any ongoing resident concerns
• The property’s current Rent Board registration status
• Vendors or contractors you would like to continue using

Just as importantly, decide how involved you want to remain.

Do you want to approve every non-emergency repair over $250? $500? $1,000? Do you want to participate in leasing decisions? Do you want copies of every vendor invoice? Would you prefer a phone call when something significant happens, or are you comfortable reviewing it later in your monthly report?

There isn’t one correct level of owner involvement. What matters is finding a management company whose operating model is compatible with yours.

A rental housing provider who wants to remain closely involved may be unhappy with a company designed to operate very independently. An owner who wants to hand over virtually all day-to-day responsibilities may be equally unhappy with a manager who routinely sends ordinary decisions back for approval.

Knowing what you want to delegate makes it much easier to recognize the right fit when you find it.

1. What Does “Full Service” Actually Include?

Start with the basics. Ask the prospective manager to describe exactly what is included in the monthly management fee.

Does the company handle:

• Rent collection?
• Resident communications?
• Maintenance requests and emergencies?
• Leasing and advertising vacancies?
• Applicant screening?
• Lease preparation and signing?
• Move-in and move-out inspections?
• Security deposit accounting?
• Rent increases and required notices?
• Rent Board registration and tenancy updates?
• RHSP registration, annual Self-Certification Inspections, compliance, and follow-up?
• Bookkeeping and owner financial reporting?

Don’t assume a service is included simply because the company describes itself as full-service.

2. Who Will Actually Manage My Property?

The person selling you the company’s services may not be the person you call six months from now.

Ask who will be your primary point of contact and whether your property will have a dedicated manager. Find out who handles resident calls, maintenance issues, accounting questions, leasing, and after-hours emergencies.

It is also reasonable to ask how many properties or units your assigned manager is responsible for. A highly experienced manager isn’t much help if that person is stretched too thin to respond when you need them.

Ask about the rest of the team, too. Property management is rarely a one-person operation. Understanding who does what will give you a much better picture of how your property will actually be managed.

3. What Will I Pay — Besides the Monthly Management Fee?

The monthly management fee is only one part of the cost of property management. Before comparing companies, make sure you understand all of the fees you may be charged and when they apply.

Ask for a complete fee schedule and find out whether there are additional charges for:

• Leasing or tenant placement
• Lease renewals
• Property inspections
• Setup or onboarding
• Administrative services
• Maintenance coordination
• After-hours or emergency response
• Serving notices
• Attending inspections, hearings, or court proceedings
• Vendor or maintenance markups
• Management while a unit or property is vacant

Ask how these charges work in practice. For example, if a plumber submits a $1,000 invoice, will $1,000 appear on your statement, or will the management company add a coordination fee or percentage markup?

Also ask about fees that arise less frequently, particularly those associated with a vacancy, a difficult tenancy, or ending the management relationship.

The lowest monthly management fee does not necessarily mean the lowest overall cost. When comparing companies, look at the entire fee structure and the likely cost of the services your property will actually require.

4. How Do You Handle Maintenance and Repairs?

Maintenance is one of the areas where the relationship between a rental housing provider and property manager is tested most often.

Ask what dollar amount the manager is authorized to spend without contacting you. Find out whether you can establish your own approval threshold and how true emergencies are handled when you cannot be reached.

Other useful questions include:

• Do you use in-house maintenance staff, outside vendors, or both?
• Are owners permitted to use preferred vendors?
• Are vendor invoices provided to the owner?
• Do you add a markup or coordination fee to maintenance costs?
• How are after-hours emergencies handled?
• How do you determine whether a repair request is urgent?
• Who follows up to make sure the work was actually completed?

You should know in advance how much discretion you are giving the manager over your money and your property.

5. How Do You Handle Leasing and Applicant Screening?

A vacancy can be one of the most expensive periods of property ownership, so understanding how a management company handles leasing is important. But don't assume your property manager has to handle every part of the process.

Some management companies handle leasing entirely in-house, while others use lockboxes or other self-showing systems that allow prospective residents to tour a vacant unit without a leasing representative present. Ask exactly how the company handles showings and decide whether that approach is right for your property.

If you prefer prospective residents to meet with someone personally, say so. You may be able to exclude leasing from the management agreement and use a separate leasing agent or leasing service for vacancies while the property manager handles the ongoing tenancy.

If the management company will handle leasing, ask:

• Who determines the asking rent?
• Where will the property be advertised?
• Who prepares the listing and takes the photographs?
• How quickly are inquiries answered?
• Are showings conducted in person, by appointment, or through a lockbox or self-showing system?
• If self-showings are used, how are prospective residents verified and access codes or keys controlled?
• Who processes applications?
• What written screening criteria are used?
• Who makes the final decision on an application?
• How are guarantors handled?
• Who prepares the lease and other required documents?
• Who conducts and documents the move-in condition inspection?
• What additional leasing or tenant-placement fees apply?

There isn't one correct leasing model. A self-showing system may offer prospective residents greater scheduling flexibility and reduce leasing costs, while an experienced leasing agent who meets prospects can personally show the property's features, answer questions, and provide a more hands-on experience.

The important question is whether the company's leasing model matches the way you want your vacancies handled. If it doesn't, ask whether leasing can be carved out of the management agreement and handled separately.

In Berkeley, whoever handles the leasing should also understand the state and local requirements that apply to advertising, applicant screening, required disclosures, and the particular property's regulatory status.

6. How Well Do You Know Berkeley’s Rental Housing Requirements — and How Do You Stay Current?

If your property is in Berkeley, your property manager should have an intimate, working knowledge of the city’s rental housing requirements — and that knowledge needs to be kept current.

Berkeley rental housing providers operate under an unusually complex combination of state and local laws. Requirements can differ depending on the type of property, its regulatory status, when a tenancy began, whether the owner lives on-site, and other circumstances.

This isn’t an area where a manager should be learning the rules only when a problem arises.

Ask how much of the company’s portfolio is located in Berkeley and, importantly, how the company keeps its staff informed when Berkeley or California requirements change.

A prospective manager should have established procedures for matters such as:

• Rent Board registration and tenancy reporting
• Determining the regulatory status of individual units
• Lawful rent increases
• Security deposits and required accounting
• Applicant screening and leasing requirements
• Required disclosures and notices
• Entry into occupied units
• Habitability and repair obligations
• Changes in occupancy
• Termination of tenancies and Berkeley’s eviction protections

Then ask some very specific questions:

Are you a BPOA member?

Do you or your staff regularly participate in BPOA educational programs and read BPOA’s legal and regulatory updates?

Who within your company is responsible for monitoring changes in Berkeley and California rental housing law?

How are those changes communicated to the employees who actually interact with residents and manage properties?

BPOA membership alone is not proof of competence. What matters is whether the company has an ongoing system for keeping its knowledge and practices current.

Regulatory knowledge also shouldn’t reside solely with the company’s owner or broker. The staff member preparing a notice, processing a new tenancy, handling a security deposit, or responding to a resident needs access to current and accurate procedures, too.

A good property manager also knows the limits of property management.

You aren’t looking for a manager who promises to act as your attorney. You’re looking for one who can recognize when an ordinary management issue has become a legal issue and knows when to stop, document what has happened, and recommend that you obtain qualified legal advice.

Berkeley experience should be more than a line on a company’s website. It should be evident in the systems and procedures the company uses every day.

7. How Will You Handle My Money?

If the property manager will collect and handle funds on your behalf, you should understand exactly how that works.

Ask where rents and other funds are held, how they are accounted for, and when rental proceeds are distributed.

You should understand:

• When owners receive distributions
• How property reserves are maintained
• How security deposits are handled and tracked
• How invoices and expenses appear on your statements
• Who is authorized to disburse funds
• How corrections or accounting questions are handled
• What records you will receive and how often

If the company uses property management software, ask to see a sample owner statement and, if available, a demonstration of the owner portal.

A sophisticated software system can provide excellent reporting and transparency, but it is only as useful as the information being entered into it.

8. What Can I See Through the Owner Portal?

Modern property management software can give owners considerably more visibility into their properties.

Ask what you will be able to access online. Depending on the system, this may include:

• Monthly owner statements
• Income and expense reports
• Vendor invoices
• Leases and other property documents
• Maintenance activity
• Resident ledgers
• Historical financial information

Ask how frequently records are updated and whether you can download your information when you need it.

If detailed reporting matters to you, say so before you hire the company. Your definition of “keeping me informed” may be very different from the manager’s.

9. How and When Will You Communicate With Me?

Some rental housing providers want to be consulted about nearly everything. Others hire a property manager precisely because they don’t want their phone ringing every time a faucet leaks.

Neither approach is wrong, but the owner and manager need to agree on expectations.

Ask:

• What kinds of decisions require my approval?
• How quickly should I expect a response to an email or phone call?
• How will I be notified about significant resident or maintenance issues?
• Will I receive routine property updates?
• What happens if my regular manager is unavailable?
• Who should I contact if I have an accounting question rather than a property-management question?

Be candid about how involved you want to remain.

10. Who Is Actually Keeping an Eye on My Property?

Collecting rent electronically and responding to maintenance requests are important parts of property management, but someone also needs to know what is happening at the physical property.

Don’t assume the company owner, broker, or even your primary property manager will personally visit your building.

Property management companies structure their field operations differently. Some managers conduct property visits themselves; others rely heavily on maintenance technicians, inspectors, resident managers, or other field staff.

Any of those models can work. What matters is understanding the company’s system.

Ask:

• Who actually visits my property?
• How often?
• What are they expected to look for?
• Are routine property inspections included in the management fee or charged separately?
• Will I receive photographs or a written inspection report?
• How are concerns observed by maintenance technicians or other field staff reported to the property manager?
• Who decides whether an observed problem requires further investigation or repair?
• How are common areas and exterior conditions monitored between formal inspections?
• If my primary manager rarely or never visits the property, how do they stay informed about its physical condition?

Pay particular attention to that last question.

A company may have excellent field personnel and a very effective system for getting information from the property to the person responsible for making decisions. Conversely, having a property manager occasionally walk through a building doesn’t necessarily mean problems are being identified, documented, or addressed.

You’re not looking for a particular staffing model. You’re looking for a reliable chain of information from the property → the person who observes the problem → the person authorized to act on it → you.

11. What Happens When There’s a Serious Resident Problem?

Ask the prospective manager to walk you through a difficult scenario.

What happens when rent isn’t paid? When a resident repeatedly violates the lease? When neighbors complain? When there is a habitability issue? When an unauthorized occupant appears?

You’re looking for a process — not bravado.

A good property manager should know how to document problems, communicate appropriately with residents, protect the owner’s interests, and recognize the point at which legal counsel is needed.

Be cautious of anyone who treats eviction as a simple administrative task, particularly in Berkeley.

12. Can I Speak With Some of Your Current Clients?

References can tell you things a sales presentation won’t.

Ideally, speak with rental housing providers whose properties resemble yours in size, location, and complexity.

Rather than simply asking whether they’re happy, ask:

• What does the company do particularly well?
• Where could communication be better?
• Are financial statements accurate and timely?
• How are maintenance expenses handled?
• Have there been any unexpected fees?
• How responsive is the company when something goes wrong?
• Would you hire them again?

That last question can be particularly revealing.

13. What Happens If I Want to Leave?

Read the termination provisions of the management agreement before signing it — not when you are already unhappy.

Ask:

• How much notice is required?
• Is there an early termination fee?
• Are there continuing fees after termination?
• What happens to security deposits and owner funds?
• How quickly will records and documents be transferred?
• How are existing leases, resident ledgers, inspection records, invoices, and maintenance histories delivered to you or a successor manager?
• Will you be able to export or download information stored in the company’s property management system?

Your property records should not become a hostage to a bad management relationship.

Red Flags to Watch For

No single answer necessarily means you should walk away, but prospective clients should pay attention when a management company:

• Is vague about fees or won’t provide a complete fee schedule in writing.
• Can’t clearly explain who will be responsible for your property after you sign.
• Has no clear procedure for after-hours emergencies.
• Won’t disclose whether maintenance invoices are marked up.
• Can’t show you a sample owner statement or explain its accounting and reporting process.
• Has little Berkeley experience but seems unconcerned about the city’s additional regulatory requirements.
• Answers “How do you stay current on Berkeley rental housing law?” primarily by telling you how many years they have been in business.
• Uses the same leases, notices, and procedures everywhere without accounting for local requirements.
• Promises that it can “get rid of” a difficult resident without first discussing the facts and applicable law.
• Doesn’t have a clear process for documenting resident communications, inspections, repairs, and lease violations.
• Discourages you from reviewing the management agreement carefully or asking questions about termination.
• Makes it difficult to determine how you will obtain your financial records, resident files, leases, and other property records if the relationship ends.

One of the most useful questions may be the simplest:

“Tell me about a management situation that went badly and how you handled it.”

Every experienced property manager has dealt with difficult situations. The substance of the answer — including what the company learned and what it did afterward — may tell you more than a polished sales presentation.

Don’t Choose on Price Alone

Property management is an unusual service because the manager may be entrusted with your property, your money, your records, and much of your relationship with your residents.

The lowest monthly percentage therefore isn’t necessarily the least expensive option.

A manager who prevents an avoidable vacancy, catches a maintenance problem early, keeps accurate records, responds promptly to residents, and recognizes a legal issue before it becomes a serious problem may be worth considerably more than the difference between two management fees.

Look at the entire operation: experience, staffing, systems, communication, accounting, maintenance practices, local knowledge, and judgment.

And interview more than one company.

The goal isn’t simply to find someone willing to manage your property. It’s to find a manager whose approach to managing it is compatible with yours.