Big Challenges of Property Management: Maintenance Edition
It may surprise you to learn that the biggest problems in Maintenance have nothing to do with houses.’.
When it comes to property management, every phase of the cycle has its own unique challenges. This month, we’re going to ‘go deep’ on a few of the most challenging areas of our business, talk about what our greatest challenges are, and how we’re currently trying to address them. To start off, we’ll talk about our biggest challenge overall, and that is the maintenance and repair cycle.
How It’s Supposed to Go
The general timeline we have for maintenance issues looks, in theory, like this:
• Learn that a house is newly-vacated (or just signed up for our management).
• Within 3 business days, the Inspections Department gets someone out there to document the condition of the house on video and creates a timestamped list of all of the issues that should be dealt with before attempting to market the property.
• Within 1 business day, the Maintenance Department finds contractors to handle each of the issues from the timestamped list and requests bids from them. (Simultaneously, the Marketing Department reviews the video and decides whether or not the home is capable of being shown in its current condition.)
• Within 3 business days, the contractor returns a bid with line-item explanations of the costs of each item on the timestamp, and the Maintenance Department communicates the bid to the owner, who can approve, decline, line-item veto, or ask for a second/more competitive bid.
• After the owner has responded (which can itself be weeks in some cases, but that’s up to the owner), the response is communicated to the contractor and any required upfront costs are paid (and deducted from the owner’s account). From there, depending on the nature of the work done, it can be anywhere from a few days to a few months to get the home complete.
• Depending on the type, scope, and cost of the job, we either ask the vendor for pictures of the work as evidence of completion, or the Inspections Department heads out to get a revised video (potentially with further timestamped list if it’s obvious that some items were missed or new developments have occurred in the meantime.)
• Within 1 business day, the Maintenance Department reviews the completion pictures/video and determines whether the job is done to our satisfaction. (Simultaneously, the Marketing Department reviews the video and decides whether or not the home is capable of being shown in its current condition.)
• Assuming the job is done and the home is showable, the Maintenance Department’s job is done and the property moves forward.
The Challenge: Getting Responses
Six months ago, the biggest problem with the Maintenance Department was that the system they used to tell them when they needed to pay attention to what property wasn’t a great one, and properties slipped through the cracks. Then we revised that system, putting a couple of people in charge of property status tracking, and now we’re glad to say that the biggest problem with our Maintenance Department isn’t with our own people…it’s with the contractors we hire.
Oftentimes, our team will handily stick to the timeline proposed above — but the contractors we hire don’t have the same incentives we do, so it’s common for the Maintenance Department to tell a contractor, “Hey, we’d like you to go bid on this job,” and get no response for weeks.
It’s a common practice, it turns out, for contractors who are busy at the moment (but aren’t scheduled out too far) to just ignore requests for bids until they have time to get to them. They won’t tell you that they’re busy, because then you’d find someone else to do the job — but they also won’t stop their current job to go get your bid, because then you’ll expect them to start working.
This leaves the Maintenance Department in a sticky situation, because we have a responsibility to get our owner’s homes on the market quickly — and the owners (rightfully!) don’t care why it’s taking so long; they just want it to happen faster. But it’s not actually our fault that the contractors take so long to respond. Being responsible for someone else’s poor business practices is a lousy position to be in, but that’s the reality of being in property management — particularly in the Maintenance Department.
What We Do About It
Our response to that situation depends largely on the owner — Royal Rose always strives to take our owners’ needs and styles of doing business into account. We have some owners that really do want their houses on the market ASAP, even if that means paying a little more for a rush job or line-item vetoing all but the most vital parts of any given work order. On those jobs, we’ll ask multiple contractors for bids, and if we don’t get a response from one of them within a week, we’ll ask a few different contractors.
On a job for a less urgent owner (quite frequently the case for owners from overseas), we might only ask one, and/or give the contractor an extra week to get back to us. After all, we have to keep an eye on the relationship we have with our contractors as well and being an annoyance on the regular is bad juju. For a more cost-conscious owner, we might wait longer to get a 2nd or 3rd competitive bid so we can show the bids side-by-side before we ask the owner to approve any of them.
Finally, we do our level best to report to the owner as each milestone is reached — when we have a bid, when work starts, what the expected completion date is, and so on. We find that most owners are willing to be flexible in most ways, as long as they know what’s going on and why.