Property Management Horror Stories You Can Learn From
In property management, horror stories are not what you want to be a part of, and yet, any property manager can tell you a few. We asked around, and found that with time, working as a property manager is not without the occasional nightmare.
Whose home is this, anyway?
Two stories from the state of California should serve as a warning if you are considering short-term rental opportunities in your condo community. Owners in Santa Cruz and in Palm Springs rented out rooms through Airbnb only to end up with tenants who wouldn’t leave. For several months, these squatters would neither leave, nor pay additional rent. Because California laws are designed to protect renters, the squatters couldn’t be evicted either, without a lengthy legal process. Fortunately for the owners, the visitors left after a few months, however, both owners racked up thousands of dollars in expenses. Yikes!
You didn’t need that, did you?
You wouldn’t think much could happen to a condo building that wasn’t fully constructed, much less occupied. Wrong! Elton Riley, of 911 Restoration, was called to assess extensive water damage at some unfinished residences in a new complex.“When the water company came out to install a meter, they got debris in the regulator line but then sealed it up anyway. This caused a backup, which burst 30 water heaters and ruined a huge number of apartments.”
He seemed so nice!
“Janet” manages several properties, including condo communities and some private rentals. In a rush to lease a home for one client, Janet accepted the tenant’s copy of his credit report without running it herself. She realized her mistake when the first, then second check bounced. For two months, she attempted to evict the tenant, finally scheduling a court date. When Janet and the property owner arrived in court, she received a message from the tenant: “I’ve moved out. You’ll never find me”. On his way out, the tenant did thousands of dollars of damage to the luxury apartment, and damaged Janet’s reputation as a property manager, as well. Scary! She now uses a transparent online screening process, and hasn’t had to evict anyone since.
What is this “rent” you speak of?
Many property managers work for both condo associations and for landlords, and are probably all too aware that some tenants are just bad news. In British Columbia, Susan and Chris Perret owe nearly $40,000 to seven landlords for rent, court fees, broken leases, and cleaning fees. In Toronto, Nina Willis is alleged to owe more than $7,000 to one landlord. That doesn’t count the landlords who have taken her to court over the last ten years. If your condo owners are renting out their spaces, get involved and be sure to run credit checks. Although situations as bad as these two are rare, your condo community could suffer serious financial damages if you have two or three units falling behind on dues and mortgage payments.
You have insurance for that, right?
If your property is in Vancouver, Toronto, or Montreal, you may have a tough time getting it insured. Property managers are finding their condo owner communities are unable to get insurance for their homes. Poorly constructed condos in these cities are ripe for water damage and other problems, leaving insurance companies the option of raising premiums to a ridiculous degree or refusing to offer insurance at all for some properties.
Hopefully these horror stories have not hit to close to home. Try to learn from others mistakes and keep yourself out of these scary situations
Ideas by Natalie White