When using a professional (or not so professional) property manager you need to watch your money. Here at KC Property Manager we stress to the employees that a lot of sins can be forgiven. You can miss an inspection or even choose a wrong tenant candidate (two great applications and the one that was chosen just does’t work out) but you simply cannot, under any circumstances, mess with an owner or tenant’s money!
I cannot tell you how many ways there are for property managers to steal from their rental property owners.
- Not doing the work they promise for their fees.
- Mis-allocation of monies. (Say the property manager had some work done on one of his houses but had the contractor write down the address of one of your houses.)
- Unreported rents. (Telling you the tenant moves in next month when in fact the tenant has already moved in and has paid rent.)
- Marking up bills when they say they won’t do that.
- Negotiating kick-backs from vendors and contractors on work performed.
These are just a few of the ways our current landlords have told us they have been taken advantage of in the past. As a guy that deals with other people’s money all the time, I can tell you there are ways even beyond these.
How to avoid being taken advantage of?
- Make sure your property manager uses a cloud based software program that allows you or your accountant to monitor monies in and monies out. Yes, this software can be manipulated but it usually leaves a trail.
- Don’t be afraid to hire an independent set of eyes to drive by your property every once in a while and see the general condition.
- Get on the phone. Talk to your property manager every once in a while. Get to know them and then trust your gut. If they aren’t answering questions, or worse, not returning your calls you might get immediately suspicious.
Listen, there is no full proof way to make sure you aren’t ever the victim of dishonest business practices. Crooks have more time to figure out their schemes than you have. But use some common sense and intuition when it comes to monitoring your money.