No Long Term Property Management Contracts
Before we begin our rant, we want to put something upfront, just for purposes of guiding the rest of our conversation.
Our CEO is a retired Army JAG, and a licensed North Carolina lawyer.
He could write a contract that would have you give our company your first born if you break it.
But why don’t we believe in the long term contracts that other property management companies use in Fayetteville, NC?
Simply because they don’t serve any useful purpose.
What we are referring to are contracts where the property management company locks you into a year long ordeal. Why would you want to be locked in?
What Goes Into Those Long Term Property Management Contracts?
Reading and understanding your contract, or Exclusive Property Management Agreement as it is called, is the key.
At the basic level, the contract, or agreement, whatever you want to call it, is supposed to spell out the obligations between you as a landlord, and the property management company.
But there are other things property manager in Fayetteville add to the contracts. And here are some of the terms:
A Portion of the Commission for the Sale of Your Property
The property management company will take a commission if your property is sold at some point, both during and after your agreement with them has ended.
So you mean to tell me you get paid money for doing nothing? If I sell my property you still get paid?
In what world does this even make sense?
What your property management company is doing, is trying to create an additional stream of income, based off something they had nothing to do with it.
Sure if they referred you to a great agent, and the agent did well, they should be entitled to a commission.
But that commission should not come from you, it should come for the agent. In other words, you are not even involved in the process. Your selling agent should be the one paying any commission, but only in the event your property management company referred them to you.
If your property management company didn’t put in any work, they don’t deserve a commission.
And don’t let us get started on the exclusive right to sell.
This is the sneaky little thing they put in there where you have to give them the listing if you decide to put the property on the market.
Ridiculous isn’t it?
A Penalty if You Break the Property Management Agreement
Contracts that say you have to pay a penalty if you break the agreement.
So if I am not satisfied with your services I have to pay to get out?
Again, this makes no sense.
What this clause in the long-term property management agreement does is, it allows the property management company to just sit back, do a mediocre job, and collect fees from you.
They might not technically be violating the agreement to the point you can claim a breach of contract and walk away, but they are not doing a good job at all.
Or the flip side of it is that some property management companies are just plain bad.
And the downside is you are stuck with them for a long….long….time.
So What Does Linchpin Property Management Believes Makes an Agreement?
Simply put, the agreement between our company and a landlord is based on a mutually beneficial relationship.
What that means is that the landlord holds us accountable for our service, and we hold the landlord accountable to give us the tools we can use to make our service effective.
If there is a breakdown in one side of the relationship, and it can’t be fixed, then either party can walk away.
Customer service and satisfaction forms the relationship, not being locked into some paper drafted by an attorney, that no one really understands.
But Your Landlords Will Leave as Soon as You Place a Tenant!!
Maybe, but not likely
What we believe is that the landlord comes to us because we are helping the landlord with a particular pain they are having.
Bad tenants causing sleepless nights.
Good tenants who want something done causing sleepless nights.
Bad tenants need to be evicted and the landlord is tired of dealing with it.
Good tenants want someone to come and take care of valid concerns.
Bad tenants destroying a house because regular inspections were not conducted.
The list goes on and one.
Our view is that, sure a landlord could walk away with their tenant. But at the end of the day, the tenant belongs to the landlord, and we are just an agent for the landlord.
What we believe is that our quality service will keep the landlord around.
We addressed the landlords pain points, fixed them, and patched up the landlord’s mental health and well being.
We gave the landlord back free time to play with their kids, have dinner with their spouse, or use the time to find other investment opportunities.
If the landlord walks away, that’s ok. But we are pretty certain they’ll be back.
But How Do You Guarantee Revenue if You Don’t Lock Them Into a Long-Term Property Management Contract?
Another not so valid point.
If you read this far, you can probably guess our answer.
Again, our revenue is based on our quality of service.
If we aren’t providing a high quality of service to the landlord, we don’t deserve to get paid.
That’s the bottom line.
If the landlord is happy, we are happy, and our fees get paid.
If the landlord is unhappy, and we can’t fix it, then it’s time to reevaluate our systems to make it better. . . .or we don’t eat.
Long Term Property Management Contracts Lock You Into A Nightmare
Long term contracts do little more than lock you into a nightmare.
It’s like the old days when cellphone and cable companies had you for an entire year, and then delivered crappy service.
At Linchpin Property Management, our goal is to provide you with a high quality of service.
This is what keeps you around for the long term, and creates a happy, mutually beneficial relationship for years to come.
Don’t let other property management companies lock you into a nightmare. Wake up and smell the coffee.
Find out how we can help you with your property management needs by scheduling your consult with us today.
The Team at Linchpin Property Management
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The Pain in The Butt Disclaimer:
As always, information on this website is not intended to constitute legal advice, or the retention of our property management services, and is for general information purposes only.
Read our full disclaimer here: Legal Disclaimer