Do condo associations need property managers?
By: Shamontiel L. Vaughn
Tags: Property Management, Property Managers, Condo Board Association, Condominiums, Management And Leadership

Do condo associations need property managers?

Finding the right property manager for your condo board

When a condo association hires a property management company, the entire goal is to lighten the load of the condo board and to properly take care of the needs of the condo association. Some companies are worth every dime they make. Others need to shut down immediately and find a new career path. The tough part is you will not be able to tell who is who until you actually work with the company.

As a renter of both apartments and a condo, I vaguely understood how property management companies worked. But when most of your communication is with a landlord or a condo unit owner renting out her unit, renters don’t really have much interaction with the property manager. Renters barely interact with other condo unit owners. There’s no reason to because the landlord is supposed to handle any repairs, outages and concerns that a renter may have.

But when you’re a condo unit owner and paying assessments, the management fees for the property management company are included in that monthly fee. So if you get a bum deal on a property manager, you’re probably going straight to the board to fix this issue. (Depending on the bylaws, the condo board would usually decide when to hire and/or terminate the agreement with contractors. Some condo associations may choose to have a two-thirds vote though, which can make working with contractors cumbersome, depending on how active the condo unit owners are.)

An effective property management company should complete the pieces to your condo association puzzle. Whether it’s a large company or a small team, both the condo board and property management company should be on the same page at all times with the contract. Unfortunately, I recently ran into a property management company that collected its monthly fees on time without fail. However, I found out the property management company hadn’t paid our electricity bill in seven months, our waste management company in three months, and our water and sewage bill in five months. There was also an outstanding snow removal bill that the property manager decided not to pay — even after signing an agreement to the terms in January. And then a surprise plumbing bill showed up, after six months of the property management company ignoring snail mail bills, too. I was appalled.

Photo credit: Headway/Unsplash

In all fairness, I’d never seen nor heard anything like this with the prior two companies so this could be a very unique experience. (There were nonstop complaints about the lack of responses or no follow-through on emails with a second company though.) Just as there are slum landlords, there can also be slum property management companies. Don’t be fooled by websites that state they have decades of experience or manage countless other properties. As with any career field — or presidency, while we’re at it — just because someone has been doing something for a long time does not mean they’re very good at it. So how do you figure out whether a potential property management company works well for you?

Understand how hands-on condo boards want to be with property management. I’m a journalist, which means I live by the motto, “If your mother says she loves you, check it out.” It has been beaten into my brain to always make sure people are doing what they say they’re doing. I don’t go out of my way to try to find dishonesty in my everyday life, but if I start seeing signs, that sends off an alarm in my head to verify everything. In the case of the property management company above, I had no reason to doubt they were paying bills on time. It wasn’t until I got an email alert about a threat to suspend one account that was three months past due that I decided I wanted to know the account numbers and payment status of every single company after that. If you can ignore one company, chances are you can ignore them all.

The treasurer that I work with (I am the president) also has a skeptical mindset, which makes her want to check out companies ahead of time before signing up for any new contract (or renewing). For this reason, we work extremely well as a team and were an (obvious) annoyance to this property management company that slacked off on every possible thing in the contract. Within two months, we both decided it was best to part ways. Condo boards should not have to hold the hand of the property management company. They are there to make the condo association and condo board’s life easier. They are paid to fill in gaps where needed and exercise areas of expertise that condo unit owners (and board members) simply may not have.

Photo credit: Josh Calabrese/Unsplash

But if your condo association has board members that are more hands-off and leave all responsibility solely up to the property management company, it is extremely important that you work with a property management company that is trustworthy to begin with. Otherwise, you will have no idea whether your assessments are being used as intended.

If you know your board members are too busy to really follow-up or keep track of what’s going on, you will need a property management company that prioritizes regular communication and transparency above all else. Before making nominations for (annual) board members and property managers, the condo association should pay attention to the work habits of both groups.

Pay attention to past reviews of the company. I’ve made it pretty clear how much I enjoy Yelp — not just for them calling out racist companies but for how useful the feedback is to understand a diverse group of clients. The same property management company that can sell or help you buy a condo unit may not be the same one that runs your condo association well. Or, maybe you’ve found that a property management company went down the drain once a maintenance person was terminated. Or, you may find that a property management company is scooping up clients faster than they’re actually taking care of the property. Read all the Yelp reviews, Google reviews, Better Business Bureau (BBB) reviews and word-of-mouth reviews that you can find about the actual company.

I’ve lost count of the number of times I’ve heard great things about certain property management companies who own a building in [insert convenient neighborhood here] or who have beautiful lawns and the maintenance is well-done. All that proves is that the gardener and janitor are excellent at their job. Hire them. And the location is just a matter of luck. Look past employees that can be terminated next week or the company that happens to manage a place you want to live. Read how the actual property management company takes care of the property. Do the property managers have a high turnaround rate? Do they have good working relationships with the board? What is it like to hire and terminate agreements with them? Are they good record-keepers?

Pay attention to how they handle criticism and queries. One of the most useful questions I’ve ever found in job interviews is asking, “What is your worst attribute? What is your best?” My answer is always the same: “I’m dependable and live and breathe deadlines, but I have very little patience.” Because I do everything by a deadline and treat my word like it’s a Bible psalm, I too often expect everyone else to do so. So tardiness and a consistent pattern of being undependable or disorganized will make me want to put on a strait jacket. Ask property management companies where have they found areas of improvement and what did they do about them. You are paying them to work with you. Don’t assume every one of these companies are “A+” ratings on BBB. Be wary of any company who only wants to tell you how awesome they are without explaining how they handle resolutions — or how to contact higher-ups if the immediate property manager is a dud.

Decide, as a group, whether you need a property manager. There are plenty of self-managed condo boards who are doing just fine. In the bylaws for my own building, the initial budgets and wording states that a property management company was not even needed. But don’t be fooled into thinking this is an easy, breezy volunteer position. (Some condo associations agree to pay, but that’s a case-by-case scenario.) Presidents, secretaries, treasurers and (optional) Members at Large will be tasked with a lot of work — bill payments, condo assessment collections, legal fees and follow-up regarding unpaid assessments, insurance audits, state and local taxes, hiring and terminating contractors, record-keeping of all repairs, email and phone customer service, in-person or virtual board meetings, and sometimes intervening with unit owner disputes and unit-to-tenant clashes.

If your board finds themselves completely overwhelmed by the workload, it doesn’t magically disappear. You may find yourself needing a property management company to come up for air. Asking board members to do all of this free of charge can become more of a hindrance, even for the most hands-on board. While (depending on your bylaws) the board is usually in charge of hiring and terminating agreements with new property managers, it’s also the responsibility of the condo unit owners to be active voters and making sure they have people who have the time, energy and dedication to ensure the condo needs run well. There are no right or wrong answers, and each board member and unit owner are different. It will be up to your association to decide what you need on any given year.