What Type of Property Management Company Is Good For HOAs
Managing a HOA is not the same as managing an apartment. There are many factors which go into it. Many property management companies will not take on HOA management due to the amount of work which can be involved. As well as the fact, you tend to get more calls from the owners, even though you have an established contact person. Many times I hear from HOAs their previous property management company was horrible. Then we speak to the management company, and they tell the story of how hard the HOA communication skills were. They site examples of how multiple owners called constantly about work around the property. They had questions regarding accounting, when the information was available online for them.
The first thing you need to establish as a HOA, when considering a property management company, is what level of service you are expecting. Are you looking for someone to focus on accounting only? Or are you thinking full service, including all maintenance. Are they going to make a phone call to your vendor or do they provide the service themselves? Once you have established your wants, you can set up interviews with companies which best meet your needs. You should always look for someone whom has an office near your property, and strong references. Be specific about your expectations, and level of service requirements as you are interviewing them. Get a minimum of three references as a follow up.
Once you have selected your company, be sure to check they have the proper insurances in place. They should be properly licensed, insured, and have a 24 hour emergency line. Accounting wise, financials should be on line with access in real time. This information should be accessible by each of the owners, or at least by and the other board members of the HOA, specifically the treasurer.
Keep in mind, having a management company in place does not mean the elected board is relieved of their responsibilities. The management company is simply there to assist, and can attend board meetings if you so choose. Be advised, there usually is an additional fee for this service.
After establishing a relationship, the next steps to outline are what you want from them. Do you want the management company to continue using your landscaper, pool person, accountant, and other current vendors? Or can they save you money by bringing in their own work force? Figure this out, and establish a line of communication immediately. Assign ONE or TWO persons who the management company can take instructions from, and is authorized to approve requests. This contact person will know who from the HOA, has the responsibility of handling maintenance requests. Having multiple contacts can create an organizational nightmare for everyone. Be sure the HOA also has one individual assigned to their account. This person can contact the management company, in order to avoid messages not getting passed around.
Monthly reports are a must! Make sure your accounts get reconciled, and reports are available online for you within a certain time frame. They should include your yearly business filings and accounting for your HOA taxes.
Overall, communication is the key in choosing a property management company. You will want to make sure they have established systems in place for HOAs, including, making sure the HOA and their board members follow the CC&Rs and Bylaws.