Monday, April 1, 2019

038: The Most Misunderstood Facts About Property Management

Today, we’re talking with my friend and my property manager Tim VandenToorn.

Tim and I went to high school together, but I don’t think we ever actually talked at length until about 6 months ago when I ran into him at the gym. After chatting for a bit, I found out he was a property manager… and not just any property manager. He runs the second largest residential property management company in Grand Rapids, Michigan.

The timing of our encounter was kind of funny, because I had been working with a different property manager on my rentals for about 6 – 7 years. Back when I first hired them, they were pretty good, but as the years went on, I felt like their quality of work was getting worse and worse (they were dropping the ball all over the place). So, I decided to give my old property manager the boot and give Tim’s outfit a shot. So far, my experience with Tim's company has been a HUGE improvement.

When I found out Tim was running this kind of business, I thought he’d be a great person to have on the podcast for a few reasons.

For anyone out there who owns rental properties (whether you manage them yourself or you outsource this work to a professional property manager), you know how important this job is. Property management is what makes or breaks your success in the rental property business. This is how you find good tenants, get rid of bad tenants, keep your properties in good working order, and a lot of other crucial day-to-day tasks that go into the success of a rental property portfolio.

If you want to scale this kind of business and NOT have it take over your life, it’s imperative that you know where and how to find a property manager who will actually do a good job (and believe me, MANY of them don't). I learned the hard way that simply hiring the first property manager you come across is incredibly naïve, and there’s a good chance you’ll end up disappointed.

Years ago, I wrote a blog post with a list of all the questions I ask when I’m interviewing a new potential property manager. I thought it would be interesting to run Tim through these questions to show you how this actually can give you a pretty good idea for how good (or incompetent) your property manager is.

I also wanted to talk with Tim about his experience as a real estate investor and property manager over the past decade or so. Because I don’t know many other people who manage 800+ rental units and work on this level. This guy has seen A LOT of what there is to see in the world of rental real estate and I was curious to hear what goes into running an operation of this size… and from a personal level, what are the best and worst parts about running this kind of business?