How to Choose a Property Management Company

How to Choose a Property Management Company in Seven Steps

Short on time? Follow these steps in order. Each one links to more detail further down the page.

1. Write down your goals. Long-term tenant, vacation rental, HOA, commercial or farm lease? The right manager depends on the job.
2. Verify the Oregon license. Look up the manager on the Oregon Real Estate Agency license search before the first meeting.
3. Ask the same questions to every manager. Use the list below, and write down each answer.
4. Get every fee in writing. Ask for a sample fee schedule and a sample owner statement.
5. Read the management agreement. Check the term, the cancellation notice and any fees to leave.
6. Test their local reach. Ask who will see your property, how often and how fast they arrive after a call.
7. Watch for red flags. Pressure to sign, vague fees or no trust account are reasons to walk away.

Questions to Ask a Property Manager

Bring this list to every interview. Ask each manager the same questions, in the same order. Then compare the written answers side by side. Vague answers are an answer too.

License, money and contracts

• Who holds the Oregon license, and what is the license number?
• Where do you hold rent and deposits? Is it a separate clients’ trust account?
• What does the monthly fee include, and what costs extra?
• How long is the agreement, and how much notice do I need to cancel?
• Do you charge a fee to cancel, or to take over a tenant you placed?

Tenants and leasing

• Can I see your written screening criteria?
• How do you set the rent, and how do you market a vacant home?
• How do you handle late rent, notices and lease renewals?
• How do you make sure every applicant gets the same fair process?

Repairs, emergencies and reporting

• Who answers the phone at 2 a.m. when a pipe bursts?
• What repair amount can you approve without calling me first?
• Do you add a markup to vendor invoices?
• How often do you inspect the home, and do I get photos?
• When do I get statements and money each month, and what do they show?

Check the License Before You Choose a Property Management Company

In Oregon, managing rentals for someone else is licensed work. Under ORS Chapter 696, a person may not engage in professional real estate activity without an active license. The same chapter defines management of rental real estate to include advertising, screening tenants, collecting rent and holding trust funds.

Property manager licenses are issued by the Oregon Real Estate Agency. According to the agency’s property manager licensing page, applicants complete a 60-hour pre-license course, pass a state exam and clear a fingerprint background check. In addition, a licensed property manager must open and maintain at least one clients’ trust account.

You can check any license in a few minutes. Search the manager’s name on the Oregon Real Estate Agency license lookup. Make sure the license is active and matches the business name on the contract. For example, Joshua Thornton holds Oregon property manager license #201261731.

How Property Management Company Fees Work

Fees are an easy place to get surprised. Two managers can quote the same monthly rate and still cost very different amounts by year end. So ask for the full fee schedule, not just the headline number.

Here are the fee types you will see most often. Not every company charges all of them.

• Monthly management fee: Usually a percentage of rent collected. Ask whether it is charged on rent due or rent actually collected.
• Leasing or placement fee: Charged when a new tenant signs. Ask what it covers, such as photos, showings and screening.
• Setup fee: A one-time charge to onboard the property.
• Renewal fee: Charged when a current tenant signs a new lease term.
• Maintenance markup: A percentage added to vendor bills. Ask if one applies and how much.
• Vacation rental fee: Short-term rentals are usually priced as a share of booking revenue, because the daily work is heavier.
• Cancellation fee: Some agreements charge a fee to end early. Read this part twice.

Want real numbers? Our property management FAQ lists Thorn’s typical fee ranges for long-term, short-term, commercial and agricultural rentals. Then compare them with any written quote you receive.

Tenant Screening and Fair Housing

Screening is one of the most important jobs a manager does. Oregon sets clear rules for it. Under ORS 90.295, a landlord must adopt written screening criteria before charging an applicant screening fee. The applicant must also get written notice of the fee, the criteria and the screening process.

The same law limits the screening charge to the actual cost of screening. It also allows only one screening charge in any 60-day period. So ask each manager to show you their written criteria and the notice they give applicants.

Fair housing matters just as much. The federal Fair Housing Act bans discrimination in housing. Oregon law, in ORS 659A.421, adds more protections, including source of income such as federal rent assistance. Therefore, a good manager uses one written standard for every applicant and can explain it in plain words.

Communication and Owner Reporting

Many owner frustrations come down to communication. You should never have to chase your manager for an update. So ask how they report, how often and through what channel.

• Monthly statements: Rent received, bills paid, reserves held and the owner payout.
• Year-end summary: A report your tax preparer can use, plus any required tax forms.
• Inspection reports: Dated photos at move-in, during the lease and at move-out.
• Response time: A clear promise for calls and emails, in writing.
• One point of contact: A named person who knows your property.

Ask to see a sample owner statement before you sign. If the sample is hard to read, the real ones will be too.

Local Knowledge in Bend, Redmond, Sisters and Sunriver

Central Oregon is not one market. Each town has its own rules, renters and seasons. For that reason, ask every manager which towns they serve and how often they are on site.

Bend property management often means city rules and a wide mix of neighborhoods, from older homes to newer subdivisions. Redmond property management often means single-family homes and longer leases. Meanwhile, property management in Sisters and Sunriver property management often involve second homes, cabins and vacation guests.

Rural parcels add wells, septic systems and long gravel drives. Our Tumalo property management page covers that work in detail. We also serve Terrebonne, Powell Butte, Alfalfa and Cloverdale. Outside city limits, short-term rentals must collect the Deschutes County transient lodging tax, so a manager should know county rules too.

Not every property is a house. If you own in a community association, see our condo association management page. For offices, retail or warehouse space, see commercial property management in Bend.

Red Flags When You Choose a Property Management Company

Most managers work hard and play fair. Still, a few warning signs should make you pause. If you see more than one, keep looking.

• No license number, or a license that does not match the business on the contract.
• No clients’ trust account, or rent that mixes with the company’s own money.
• Fees that only show up later, such as hidden markups or vague “admin” charges.
• A long contract with a steep exit fee and no clear way to end it.
• No written screening criteria, or screening that changes from one applicant to the next.
• Promises of top rent with no comparable rentals to back them up.
• Slow replies during the sales process. It rarely gets faster after you sign.