When Bad Property Managers Attack, PM 2
Oh, you thought PM 1 was our only bad experience with property managers? No, I’m sorry to say–I’ve come by most of my experience the hard way!
One day, I woke up to the thought that it probably wasn’t such a good idea to have all 10 or so (at the time) of our rentals with one property manager. PM 1 hadn’t yet really become a thorn in my side, but I realized that we maybe needed to spread our risk between a couple property managers. I knew that such an important member of our “team” could bring our business to a screeching halt if anything went wrong–if they became ill or decided to quit property management, for instance. Also, it just made me uncomfortable knowing they pretty much held all the power in our working relationship with them. After all, we didn’t have any idea who the tenants were, have copies of any leases, or in many cases even have copies of the keys to our properties! Of course, NOW I KNOW that a licensed property manager would have let us choose the tenants, given us copies of the leases and keys, and would not have changed the locks on the properties without our permission. PM 1 knew what they were doing. :-( They really had all the control!
I found PM 2 online. They also had an impressive website, just like PM 1 did. It seemed like a match made in Heaven! I could check our statements, rents collected, and invoices online anytime day or night. Perfect! So, I scheduled an appointment to speak with the property manager there to take over the three new rental houses we were in the process of remodeling with Contractor 2. PM 1 wouldn’t ever even know about these three houses–that was my brilliant plan! We could try out another property manager without souring the relationship with the first one!
We met PM 2 at his office. He was a licensed broker, by the way, though I didn’t make the connection at the time. When we walked in, we were introduced to his “staff”–his daughter and wife. They ran the office and fielded maintenance calls while he ran around and did the legwork like leasing, meeting contractors, checking on tenants, etc. I noticed that the office seemed a bit messy. There were papers everywhere. And, it looked like the place needed a good sweeping. But, I put it out of mind. I figured they were just busy people.
We signed the property management agreement for our three new rentals. PM 2 was eager to put them on his nice website and start advertising them to prospective tenants. We were pleased as punch to hand him the keys.
A month went by with not a word. I knew it would take some time to get the paperwork processed, get the houses on the website, and advertise them for lease. But, after a month, the houses weren’t listed on the site. So, I called PM 2. I got his voicemail. Well, OK, so he just got busy. I called again once a day and left another voicemail, and another. I called the office. I called his cell. I left voicemails on both numbers. Finally, we drove back to his office to search him out. We were in luck–he was there! He apologized profusely and said he’d correct the situation immediately! Good!
Lo and behold, the houses did make it onto the website. Signs were placed in the yards. But, another month went by with still no communication from PM 2. Based on my experiences with PM 1, I knew these houses should have already been leased! I was really getting frustrated. I tried to reach him over the phone again and was unable to…again. So, once again, we drove to PM 2’s office. This time, we could tell he was in there. We heard someone inside when we first walked up before we knocked. But, he hid from us! He actually hid in a back room while we knocked on the locked front door during business hours! We knew it was him–his car was in the parking lot. I was getting really close to firing the man. Having never fired anyone before, I was putting off the inevitable. How do you fire someone who avoids you like the plague–by post-it note?
Then, much to my delight, PM 2 called one day to let me know he’s found a tenant for one of the empty houses. He asked if they sounded OK to me–they were a Section 8 tenant expecting a 3 bedroom voucher. Well, we had rented to Section 8 tenants before. So, it seemed alright to me! I was happy that things were looking up with PM 2. It looked like he might work out after all!
Most unexpectedly, a few days later, Michael (my fiance, for those of you who don’t already know) received a call from PM 2 (What?–He didn’t want to speak to me?). PM 2 said he’d been out showing houses and had been frightened by a group of guys with knives who began to walk up to him in front of the house he was showing (not one of ours). Luckily, PM 2 had a concealed carry license, pulled his gun, and scared the guys away. But, it frightened PM 2’s wife enough that she insisted he quit the business. So, he asked us to come pick up our keys to our three houses right away.
Completely confused and bewildered, we walked into the office. We were met by PM 2’s wife, who was very curt and angry. She had everything ready for us in a folder. It basically felt like she was saying, “Don’t let the door hit you on your way out.” Inside the folder was the contact information and lease for the Section 8 tenant that PM 2 installed. There was also a note from him explaining that the tenant had not qualified for a 3 bedroom Section 8 voucher after all–they only got a 1 bedroom voucher! But, they were already living in the house! So, it was basically up to us to either ask them to leave or decide to accept an amount much less than what the market said the house was worth. This was a disaster! What the Hell?!?
I was totally stressed out. If we asked the tenant to leave, they’d probably wreck the place on their way out just for spite. The other two houses had been empty now for several months while PM 2 sat on them. If I handed the whole mess over to PM 1, they’d find out we went behind their backs with a new property manager. I discussed the whole thing with the tenant that was now paying a little over half what they should’ve been. They asked me to call Section 8 on their behalf to see if the voucher amount could be raised. So, over the course of a few days, I did. But, it didn’t help. So, I told the tenant they could have their entire security deposit back if they left the place in good shape. They did just that. So, I then handed the three empty houses to PM 1 and said we’d just purchased them.
I didn’t have the heart to try out a new property manager again for a while after that!
PM 1 began to fill the three houses with tenants. So, I counted my lucky stars (yeah, right) and breathed a little sigh of relief for the time being. But, once again, we were totally at PM 1’s mercy. And, she and her husband liked it that way.
PM 3 gave us problems, too. But, that’s for tomorrow’s post!
Oh, and by the way, PM 2 didn’t quit the business after all. I have no idea what the heck went on, but he’s still with it to this day! I wonder if he and his wife got the Prozac they so badly needed….
Trisha's Coffee Fund2 Comments
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Hi Trish,
I’ve been reading some of your earlier entries so that I could be caught up to date. I recall you saying that PM2 was referred by your agent who had an investor friend (a cop) who also used the services of PM2. Not to interogate you or anything but is this the same one or am I just confused?
I was in the property mgmt business for several years. I enjoyed managing commercial properties when I worked for Equity Office Properties. It is definately a different animal than residential properties. I also did pm for a large apt. building owner and that was not half as fun. However, I am shocked at some of the experiences you have had with PM1 and 2. Their actions are beyond unprofessional - just plain unethical and do not come close to accepted std. practices in this field. But to be successful working with your PM, I believe you need to alway be involved. Don’t be afraid that you are in their way. Don’t be hands off because no one cares about your bottom line as much as you do.
Hey, Christina - I don’t remember that now about the referral. Most likely, i chose PM 2 for multiple reasons, not the least of which was their website. I still had my day job at the time, so checking the status of the houses online was helpful! It turns out, that’s a pretty rotten reason to choose a PM. PM 1 had an even better website–but, since they stopped updating it, that did me no good at all!
I agree totally with what you said about being involved with your PM!