A Guide for Deciding Whether Or Not to Hire a Property Manager to Overlook Your Mexican Rental Properties

Should You Hire a Property Management Company?
Many foreigners that own rental or investment property in Mexico argue as to whether or not hiring a property manager to handle their rental property investments, South of the Border, is worth the associated fees.

While some people may feel that they could easily handle the tasks associated with renting out their property themselves, others prefer to leave it up to a qualified property management company or an experienced individual that will insure that things get done correctly. Either way, it is important to note that managing rental property in Mexico does require work.

So What Do Property Managers Do?
Property managers basically do all the leg work associated with the responsibilities you acquire when renting out a piece of property. In essence they perform the following tasks:

**Prepare the property in order to make it livable. This includes: painting the interior and exterior of the property, making sure bathrooms, showers, kitchen stoves, dishwashers, etc. are all working fine, before people move in.
**Help find interested tenants. Place ads and / or otherwise market the property.
**Run credit checks to determine if potential tenants are good candidates.
**Handle rental agreements and contracts.
**Give new tenants keys and possibly help them with moving issues.
**Make sure the tenant understands how everything in the house works, and tell them where the circuit breakers are as well as where the water and electrical meters are located, etc.
**Collect rent.
**Handle any other tenant issues that may arise.
**Solve common household problems such as maintenance or emergency repairs.
**Depending on the agreement, it may also be required that you mow the lawn, keep the gardens and landscape up to par, clean the pool (if you have one), paint the property every so often, etc.
**Handle moving out issues.
**Make sure the property is in good shape when the tenant decides to move out and return the security deposit if the property has not suffered from any damages.
**Clean the place up after a tenant moves out and get it ready for the next tenant.

Staying on top of these things will definitely require time as well as knowledge of the laws concerning Mexican rental agreements.

Some property management companies will even assume late payment or even non payment risks. While this service will cost you a percentage of your rental income, it will insure you always receive the money that is due. If a tenant fails to pay, the property management company will be in charge of pursuing legal action and you will probably get your money regardless.

The Downside to Hiring a Property Management Company
Different property management companies will have different requirements for working with property owners. While this is not always the case, many companies will demand that the property owner give up some of his/her rights. For example:

**Some property management companies will hold the security deposit instead of giving it to you.
**Overseeing repair fees: some property management companies will charge you additional fees for overseeing emergency repairs and any other issues, on top of what the repair company charges.
**The typical fee charged by a property management company is 10 to 20 percent of the rent.
**Placement fees: many companies also charge you a fee for finding or placing a tenant. This may be anywhere from half of the first month's rent to even more.
**Not all property management companies assume non-payment risks, so get this in writing.
**Some companies play with your money for a few days. For example, they may collect the rent on the 5th of every month, but transfer it to you on the 10th or even 15th of every month. In that way, they make interest on your funds.

Interviewing Property Management Companies
If you do decide to hire a property manager to manage your Mexican property rentals you'll want to make sure that you are working for a reputable company who has a tract record. The following form will help you decide who the best candidate for the job is. Interview several companies and see which one offers the best service at the best price.

Fees to keep in mind when comparing different Property Management Companies:
-Monthly Fees
-Fees for Lease Renewals
-Amount Required to Be Held in Reserve
-Advertising Fees
-Fee for filling a Vacancy
-Charges for Incidentals
-Maintenance Charges
-Landscape Fees
-Charges for Handling Evictions
-Fees for paying property taxes, and other government fees.
-Max amount the company can spend on maintenance, repairs, and minor expenses without seeking your authorization.

Take into account the reputation of a Company and the information it provides:
-How do I know this company means business and is not simply in it to take advantage of my ignorance?
-How many properties are they managing?
-Are they willing to let me talk to current and past clients?
-Does the company itself own properties or do they only manage other people's?
-Are they a legally established business?
-How long have they been in the property management business?
-How many property managers do they have?
-Will your account be handled by one specific person or many?
-In the event special repairs are necessary will I be forced to use the company's contractors or can I bring in my own?
-What is their online reputation like? Are people praising or complaining about them?
-Will they advertise my property online? Where?

Accounting, Finances and Taxes Issues to be aware of when looking for a Property Management Company:
-How does this company handle your financial information and property obligations? -Does the company handle property tax issues and payments or are you required to do so?
-Will the company handle all, some or none of my bills?
-When do I receive my money?
-What is their accounting system like?
-Do they send out monthly statements? Yearly?

Conclusion
Deciding whether or not hiring a property management company is in your best interest is pretty much a personal issue. Hiring a good company will definitely make your life much easier, however it will come with a price tag. If you are indeed willing to pay the price tag, choosing the company that offers you the best terms will help you avoid headaches and frustration later on. So practicing due diligence is definitely required when you decide to hire.

This article has been provide by the VivaReal Network.

About the VivaReal Network
Investing in Mexican Property can be highly profitable but it can also be quite complex. VivaReal Network helps investors make better decisions and more informed investments by providing access to property listings. We help international buyers get in touch with local sellers and agents which are experts in the local markets they want to invest in.