Tue 31 Oct 2006
After reviewing all of the applications that came in (13) I had two clear finalists. I was interested in four candidates, but two of the four were renters. As long as I had two home owners that both looked great, I decided to interview those two and hopefully choose one of them.
Candidate #1:
37 yr old male, lives 4 blocks from 3 of my buildings, computer consulting business, works part time at a technical college as a computer technician, owns and self-manages 27 units that he rehabbed himself, lives in one of his multi-plexes.
Candidate #2:
27 yr old male, lives 5 miles from my units, works full time from home for an asset management company (corporate-style property management/acquisition of large buildings).
Both candidates seemed very stable as far as having no plans to move away. Both were in the business and had some experience, although I was not looking for this and thought it could be a detriment. From the application, both were strong in sales and organization, and had good work ethic.
#1 wanted the job because he was intrigued by my systems and training offered. He thought he could learn something to use with his own rentals and could contribute some of what he has learned to my business.
#2 wanted the job because he wanted to pay off his student loans. He doesn’t believe in owing any debt and wanted the loans paid off as soon as possible.
I had a standard set of questions for each of them, and then tailored some more given each of their background. Since I don’t care so much about experience or what they know about the rental business, I was mostly trying to get to know their character, work ethic, organizational skills, sales ability, how they interact with people, and why they wanted this job. The interviews were very conversational.
#1 was very easy to talk to, like an old buddy. He is very eager to learn and has aspirations to grow as an investor. #2 was trying to impress me and I sensed a BS factor. #2 was concerned about liability and some nit picky compensation issues. He was also a corporate type and I don’t think he likes to get his hands dirty, so to speak.
I talked with each for 90 minutes. About half the time was spent learning about them, and the other half was spent covering my philosophies, how we screen tenants, market, deal with issues, how our systems work, how the training will work, compensation, and how we will interact as investor-property manager. The candidates were asked to ask questions and comment on everything I told them.
Candidate #1 was the clear winner. I emailed him my maintenance schedule to confirm that he was ok with the skills and time committment it represents and he was. Then I emailed him a property management agreement to sign. I’ve shipped him Rich Dad Poor Dad and Ken McElroy’s audio set to listen to. I am now reviewing my landlord system and updating it with a few minor changes and will be shipping that out tomorrow for him to read.
We’ll reconvene after he’s reviewed all that for a Q&A session and he’ll get the keys. I’m paying him $300 for his time spent training. My husband happened to be in the city where the buildings are this week so they met for lunch. Randy hasn’t been involved in this process of finding a new manager but said that I found a good guy and he’s excited about the change.
We decided to bump our start date to Nov 15 because I ran a little behind and didn’t want to rush it. Plus this allows our current manager to collect all the November rents and it gives the tenants two weeks to absorb the fact that they have a new manager and new place to mail the rents before December comes around.
5 Responses to “Property Management Interviews”
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November 3rd, 2006 at 2:46 am
For the life of me, I can’t imagine why you want property managers who own their own homes. As a life-long renter, the best property managers I’ve ever seen were other renters — particularly those who wanted to eventually own their own homes. Another good qualification is that they have supervisory or management experience in other jobs. Most supervisors and managers also have sales experience.
If a guy owns his own building and is watching yours, and two similar problems crop up at the same time in both buildings — guess which building is going to get priority? Surely not yours.
“Wants to learn your system” sounds like a guy who is going to stick around about three months max. He’ll probably know as much about your system as he wants to in that amount of time.
I don’t know how much hiring you’ve done in the past but I don’t believe Applicant #1 is going to stick around for very long after you hire him.
November 3rd, 2006 at 9:33 am
The reason I want property managers who own their homes is mindset. Tenants think like tenants because they live in that world. There’s an invisible barrier that prevents them from fully operating on the other side of the fence.
A homeowner understands the entire financial aspect of owning and maintaining property, plus they’ve likely had experience with handyman-type issues that have come up for them personally.
It is very similar to why I want my CPA to own rental property. He gets it and has a vested interest in getting it.
It is irrelevent to me if my manager owns his own rental properties. I don’t believe in the scarcity mentality, ie if two issues come up he will tend to his and ignore mine. If he doesn’t take care of issues that come up with my properties he loses his job.
November 3rd, 2006 at 9:52 am
Claudia:
The point you made about conflicts between managing his personal properties and managing her properties is true for everyone. Say she hires a computer programmer and his boss tells him to work late on a day when something comes up at the property. Guess which will take precendence?
The only place I could see a potential conflict of interest is in obatining renters. If he’s not completely honest, he might end up siphoning off some good renters from her property to his, although if he owns apartments and she owns homes, the pools of candidates aren’t likely to mix.
Whether or not he sticks around is a more serious concern. But if he does jump ship quickly, the worst that happens is that she has to find another candidate.
November 3rd, 2006 at 11:48 am
I’m not really sure what a “tenant mindset” is. Are you afraid they won’t take care of the property the way an owner would? To me, that’s an individual’s mindset and has nothing to do with being a tenant or an owner. There are property owners who don’t take care of their own property. There are other property owners who would only buy the most expensive when replacing something because they think the most expensive means the item is the best. Neither would make a good property manager, in spite of being property owners.
Employee turnover costs money. It should be a concern in any hiring.
I’ve been a tenant for a long time but I’ve owned my own business for over 15 years.
November 3rd, 2006 at 12:17 pm
Every individual is different and there are exceptions to everything. I look for homeowners as one of my broad sweeping initial criteria. I also look for someone who owns a vehicle, lives close to my units, has organizational skills, sales skills, work ethic, and teachability among other things.
Could I teach someone who’s never sold how to sell? Sure. Could I set up an unorganized person with systems and train them to become organized? Maybe. Could I teach a tenant how to think like an investor? Maybe. But as long as I collect a group of applicants and have my choice, I may as well cut through all that and find someone who is already there.
I have experience using both homeowners and renters as property managers and I’ve learned by comparison that I’d rather work with a homeowner. Other investors may prefer tenants or not care either way. It just happens to work for me.