How to hire a property manager

If you own multiple rental units, hiring a property manager will help you manage them hassle-free — and free up a significant chunk of your time. 

This, of course, depends on your ability to find the right person for the job. Screening potential candidates and hiring the best one might be a time-consuming endeavor when you are faced with a deluge of applicants. 

Fortunately, with pre-employment skills testing, the property manager hiring process can be much faster and easier. Using a skills testing platform like TestGorilla helps you quickly qualify high-potential candidates and weed out the ones who don’t meet the minimal requirements. 

In this article, we’ll explain how to hire a qualified property manager who meets your needs and delivers terrific results, month in and month out.

Let’s dive into the specifics to learn what property management is all about — and how hiring the right person can help you maximize revenue from your rental real estate.

What are property managers and property management companies?

A property manager is an individual who takes care of an owner’s rental properties; they make sure to keep properties in good shape and maintain good relationships with tenants. 

Any real estate investor who manages a portfolio of properties will benefit from hiring such a professional, because this will enable them to channel their energy toward employment, family life, or even another business.

Your property manager takes care of the day-to-day operations, including maintenance, repairs, collection and depositing rent payments. In addition, they help you with important tasks such as screening potential tenants and, as a last resort, managing evictions. 

A property manager is the go-to person of the property owner and tenants alike. For this reason, you need to look for strong communicators who thrive when they need to multitask — and who know how to serve as an intermediary between everyone involved. They must also not shy away from fixing any and all sorts of unpredictable problems that each new day can bring.

Each state imposes a different set of requirements for licensing and certificates that the property managers should comply with, so it’s important to check for these during the hiring process. We’ll talk more about that below.

To hire the right property manager, you’ll need to evaluate all the essential property management skills; for this, you’ll benefit from an effective screening process.

A property management company, on the other hand, is a business that brings together several individual managers so that they can meet the staffing needs of many property owners. 

Typically, such a company will have an online portal, a network of maintenance specialists, handymen, and security staff. They will either assign a dedicated property manager to each property or rotate a number of specialists to quickly deal with any matters and respond to requests from tenants and owners. 

The pros and cons of hiring a property manager 

Your new property manager will certainly add tremendous value to your business, but there are some trade-offs, too. Let’s cover both below. 

Pros of hiring a property manager

Hiring a property manager comes with the following advantages: 

• You don’t need a hands-on approach. You may or may not have dealt with property management matters before, but now you can safely delegate them to your new manager. You’ll be able to dedicate this freed-up time and mental space toward another venture, your family, or even hobbies. 

• They have a network of craftspersons at their disposal. An experienced administrator will have a reliable network of craftspersons to help them deal with any kind of maintenance and repairs. This team will be primed to spring to action and quickly respond to your tenants’ requests. 

• They can guarantee a high availability. If you manage your properties on your own, you may not always be able to react to issues as quickly as necessary. Your property manager is always available and ready to assist your tenant with any query. This is their job, and this is what they excel at. 

• You can ensure full legal compliance. Should you try managing multiple rental properties on your own, you might soon find yourself in legal hot water. Specific rules and laws apply to how you should screen, manage, and potentially evict your tenants. A proficient property administrator is equipped to manage your units in full compliance.

• They can put smooth procedures in place. A good property manager keeps effective procedures in place, whatever the situation may be. This serves to create a highly enjoyable experience for all parties involved. Happy tenants tend to renew their leases, which reduces the vacancy rate and maximizes the return on investment (ROI).

Cons of hiring a property manager

There are some downsides to hiring a property manager, such as: 

• You’ll have to pay more. The cost of hiring a rental property manager typically ranges between 8% to 12% of your rental income. For smaller rental properties, this might be too much; in this case, retaining control of your units might be a better option.

• There’s a lack of direct engagement between you and tenants. You let go of the full control over your rental units whenever you hire a professional property manager. You’ll need to trust them to make decisions on their own, be it about picking specific renters over others, requesting certain work to refurbish apartments, or repairing leaking pipes the way they see fit.

• Screening tenants or repairs personnel might be less rigorous. A hired manager may be less willing to go through a rigorous screening process, which might reduce the quality of tenants you lease out to. In addition, some property managers might take longer to respond to the requests from tenants than others. There’s also a chance they’d make use of cheaper materials for repairs and hire less qualified personnel. 

Despite all this, when you find it difficult to manage all of your properties on your own, it might be a good time to hire a property manager. This will allow you to continuously scale up your investment project and increase your net profits.

How to choose between an individual property manager and a management company

When recruiting a property manager makes the most sense, let’s take a look at how to pick between an individual administrator and a full-cycle company.

Property owners who run rental units across multiple cities or states might benefit from hiring a property management company. You’ll likely find it challenging to scale such a business while working with one individual manager.

However, you might find even more success if you go the extra mile and hire individual administrators at each location. Cutting out the intermediary will allow you to recruit and build personal relations with individual managers who can add value to your business and reduce the costs you’d incur otherwise.

Property manager hard skills and qualifications

Equipped with the below list of necessary hard skills and certifications, you’ll find it easy to identify the best-fit candidates within your recruitment process:

Required licenses at the state level

Take time to understand the specific requirements that your state has put forth. Some states don’t require the property manager to go through any kind of the licensing process, while others mandate them to obtain a license for either a real estate agent or property manager. 

Undergraduate studies

Since you are the one making the hiring decision, it’s ultimately your call whether you favor candidates with a degree under their belt or not. The most popular degrees for a property manager to have are those in finance, business administration, and, more specifically, in property management and risk management.

Special certificates for property managers

For property owners looking to scale up their business, it makes sense to recruit specialists with various certificates issued at the national level, such as the following: National Apartment Leasing Professional (NALP), Certified Apartment Manager (CAM), Certified Property Manager (CPM), and Master Property Manager (MPM).

Bookkeeping and accounting skills

As a property owner, you should expect your property administrator to excel at bookkeeping and tracking various expenditures and costs. Some property managers might also run your books, helping you to deal with taxes and accounting in your investment business.

Property manager soft skills

Property management has much to do with human connection and building relationships. The following soft skills of your future real estate administrator are critical to running a successful rental business:

Communication skills

Property managers need to articulate their thoughts and comments in a polite and effective manner. Managing relationships with multiple stakeholders and constantly negotiating over details requires excellent communication skills and dedication to finding the middle ground. Look for well-developed de-escalation techniques and patience in your future property manager.

Conflict resolution

Your tenants will inevitably have urgent requests and issues to look into, and this is where conflict-handling skills come forward as a major building block. An effective real estate administrator will be able to push down their ego and deliver the highest quality service that tenants are looking for. Upkeep and creating favorable conditions is all about your representative’s ability to quickly determine the best way to fix the issue and move on to the next matter.

Self-organization

As we’ve shown above, having effective procedures in place is crucial. Time management, prioritization, and attention to the details will determine how successful your rental project is. A great candidate also has likely already used various online portals to manage expenses, budgets, and requests from tenants.

How to assess the skills of your potential property manager

Pre-employment screening is an effective way to connect with ideal candidates in order to start reaping the benefits of a property manager sooner rather than later. The tests from TestGorilla’s test library have been developed by established subject-matter experts and have proven their worth over the years.

You can combine up to five skill tests in a single assessment. Below is a list of tests we recommend using to hire your property manager:

• Customer service. Run the Customer service test as your first test. See how well your applicant adheres to the customer-centric model, and how effectively they communicate in conflict situations. You’ll be able to determine whether your potential property manager uses the right language and avoids negative impressions and statements. 

• Time management. Another test from our Property Manager test pack, the Time management test helps you to assess how effectively the candidate prioritizes and executes the assignments in front of them. It also evaluates their skills to reflect and glean insights from previous experiences so that they can consistently improve the procedures they run.

• Communication. Run a quick Communication skills test and assess both verbal and written communication skills that your applicants possess. The appraisal helps grade your candidates on active listening and business etiquette. With it, you can spot master communicators who are accustomed to workplace interactions with multiple stakeholders and are able to quickly summarize the matters at hand and proceed to the problem-solving stage.

• Problem solving. Property managers deal with a myriad of issues on a daily basis, so they need to be excellent problem solvers. Use our Problem solving test to evaluate their skills and make sure they know how to analyze data to make correct decisions.

• Negotiation. Your property manager needs to be an excellent negotiator, too. They’ll often have to negotiate contracts with tenants and contract workers (for example, plumbers, carpenters, and handymen) to strike the best deal, so be sure to assess this ability with our Negotiation skills test.

How to write a property manager job description

To build an attention-grabbing job advertisement that will attract the right candidates, start with an introduction section that describes your real estate portfolio and opportunities for advancement within your business. Be sure to also include a bit about your values and corporate culture, as this will help you appeal to qualified candidates and differentiate your job description from similar vacancies. 

Create a clear responsibilities list

Articulate what you’ll need your ideal candidate to deal with, and how they can stand out in the position.

Sample duties to include in your job description

• Effectively market vacant units to attract qualified applicants, using job boards, social media and other marketing methods

• Deliver upkeep for all buildings and facilities, including timely maintenance and repairs

• Ensure financial viability and attainment of the financial goals set for the rental properties by managing budgets and collecting and depositing rent

• Enforce compliance with policies and lease agreements by eliminating breaches and confronting violators 

• Negotiate with stakeholders, including tenants, craftspeople and service providers, to ensure smooth-running operations that maximize profits from the rental properties

Focus on skills that matter

Consider your current and future needs so you find high-potential candidates who will stay with your company and contribute to sustainable growth.

• Excellent communication skills

• Experience using specialized property management software such as Yardi, Propertyware, and Realpage

• Attention to detail and meticulous screening processes when choosing new tenants

• Effective conflict resolution techniques for superb customer service and to avoid unmotivated move-outs

Delve into education and licensing requirements

Review any state-level licensing requirements to avoid legal issues down the road, and consider your requirements for education and certificates.

• [All of the required licenses and permissions, as set forth by your state]

• High school diploma, GED, or equivalent

• Bachelor’s degree or equivalent experience preferred

• 1-3 years’ experience in real estate sales or property management

The estimated cost of hiring a property manager

How much will it cost you to hire a property manager? 

Data shows that property managers in the US are paid between $77,000 and $125,000 annually. The exact amount will depend on a multitude of important factors, including education, certifications, actual experience, and additional skills like accounting and special software. 

Recruiting highly experienced property managers will generate additional costs. At the same time, you’ll be able to ensure exceptional customer service for your tenants and reduce vacancy rates.

Property manager interview questions

After screening your candidates, you’ll need to develop a set of interview questions in order to easily compare answers and find the best fit. To know which questions to ask, you should first define your specific needs and conditions.

Here are some interview questions we recommend asking your potential property managers: 

• Can you describe the overall procedure you use to quickly fill the vacant units? 

• What are the fees you charge? 

• How would you assess our property units to calculate their fair market value? 

• What methods and systems do you use to screen the applicants? 

• Do you have experience enforcing lease agreements and policies through to court-mandate evictions? 

• What were the biggest conflicts that you’ve faced in your career, and how did you manage to resolve them?

If you could use more inspiration, check out our guide that lists 40 interview questions you can ask a potential facility manager.

Find a skilled property manager to handle your rentals hassle-free

As your rental property business grows, you’ll likely find yourself unable or unwilling to deal with all of the administrative matters it entails on your own. At this time, it makes sense to hire a dedicated property manager to ensure high-quality services and reduce vacancies in your units. You might even look into hiring a home inspector to make sure each unit you buy is in top condition.

A great way to lessen your workload when hiring your next property manager is by making use of a pre-employment testing platform like TestGorilla. Focus on testing for soft skills such as communication, time management, and customer service, as these are the exact skills that effective property managers excel at.

Begin your free trial today and see for yourself how easy it can be to assess applicants’ skills and hire the perfect fit.