Hi, I’m Faye with Residential Property Management in Portland Oregon. Today I’d like to shed some light on the price versus service question when comparing the costs of using different management companies.
Property management is a service business, and like all service businesses, the vast majority of the cost of doing business goes to paying people to perform that service. The amounts paid and the number of people employed, is directly related to the quality of the people managing your property and the service you will receive. It has never been truer than in property management, you cannot purchase Nordstrom service at Walmart prices.
As property managers, we do not manufacturer a product that can be produced for less in a different country, and the service we provide cannot be outsourced to locations where there might be cheaper labor. As a service business, property management is very localized, meaning the property manager needs to be physically located in the area your rental property is located.
The management company’s costs to do business, and lower fees to you, can only be reduced by paying staff less or reducing the number of staff, both being detriments to the quality management you are expecting. We all want to save money, but paying less for property management often means phone calls are not returned, screening of prospective tenants is rushed, property inspections are not happening regularly, repairs are slow or not being made, and not enough time is being spent on proper accounting. Mistakes are being made and you, the landlord, are paying for them.
There’s nothing mysterious about management company fees, you get what you pay for. But shopping a service is very different than shopping a product. If you have any questions about this blog, please feel free to contact us at Residential Property Management.