San Francisco Apartment Association

From the President

Property Owners and Managers: Take Pride and Do Your Job Well

by Marc Wilson

I'm in the process of marketing and selling an apartment building for an owner/client who is not a member of the San Francisco Apartment Association. The entire process has been an odyssey into poor management practices. Deferred maintenance, poor record keeping, no written management/tenant communication, empty tenant files, no written rental agreements, low rents, revolving tenancies, dogs, no heat—the list goes on and on. What a learning experience! The most surprising revelation has been how forgiving the San Francisco apartment-building sales market is toward poor management practices. This building is selling for essentially the same price that it would fetch had it been properly managed. The sales price of this property is not being discounted because of the aforementioned problems. Apparently two landlords can own identical properties—one professionally and competently managed and the other totally mismanaged—yet they will ultimately garner essentially similar sales prices. This doesn't seem fair.

The question begs to be asked: why even bother practicing professional management policies and procedures in the first place? There doesn't seem to be any money in it. What is the point? I guess you could say the same thing about physical exercise. Why bother to exercise? The fact is that whether we exercise or not during our lifetime has close to no effect on our longevity. People who exercise routinely do not tend to live materially longer than people who don't exercise. Then why exercise? What is the point? Quality of life—the point is the quality of our lives. People who exercise are generally happier than people who don't exercise.

Believe me, property owners who practice professional and ethical property-management practices are happier than property owners who do not. Competent and ethical property managers incur less legal hassles, less tenant disputes, less late-night phone calls, less dysfunctional interaction, less anxiety and less stress. You discover that they enjoy an overall higher level of control over their lives, because they are proactive and engaged with their properties. They are not victims. The irony is that it actually takes less time and energy to be a good property manager than it does to be a bad property manager. And, they also discover that it's much healthier, too.

For you to be a healthy property manager, be mindful and conscious of the quality of your life as a property manager. Make sure you engage in only healthy property-management practices such as:

  • offer apartments for rent that are in absolutely, positively, pristine condition;
  • establish asking rents for your vacant apartments that are 5% to 7% below the market in order to ensure multiple applications and your ability to pick a perfect tenant;
  • use an offer-to-lease and tenant-application form that mandates a $300 good-faith deposit with all rental applications in order to ensure that you deal only with competent, qualified and motivated applicants;
  • use the PPMA Residential Lease Agreement with all the appropriate addendums like the mold addendum, lead-based paint addendum, the drug-free housing addendum, house rules, insurance facts for residents, smoke detector agreement, move-in/move-out addendum, Proposition 65 addendum and any other relevant ones;
  • remember your prospective tenant will sign anything you give them at the lease signing, but he/she will not be inclined to sign anything after taking possession so take the opportunity and get anything and everything signed;
  • adopt a zero-tolerance policy toward any and all deviations from your rental agreement and take immediate and forceful action to enforce absolutely all aspects of your rental agreement—do not tolerate late rents, do not tolerate loud noise, do not tolerate unauthorized pets (are you getting the picture?);
  • make sure you are prompt and professional with all repair requests;
  • manage your revolving tenancies by always being diligent, punctual and professional with your 6.14 Notices and related documentation;
  • try to reduce absolutely all communication between you and your tenants to writing, maintain professional and complete tenant files, and save and file all correspondence;
  • be fair, timely and responsible with all security-deposit dispositions and, if in doubt, return the tenants' money; and
  • be succinct, courteous, timely, unambiguous and professional with all your tenant and vendor communications and do not encourage or facilitate dysfunctional relationships—for your tenants are not your friends (or your advisors)—bur rather your customers.

Yours is the quintessential business relationship in which you provide habitable housing, and your tenants pay rent. Remember to always stay on target in this relationship: don't give mixed messages, don't be inconsistent and always be reliable and predictable. Recognize that good property management is its own reward. Take pride in doing your job well. Be the best property manager that you can be. Believe me—it's in your best interest.

The opinions expressed in this article are those of the author and do not necessarily reflect the viewpoint of SFAA or the San Francisco Apartment Magazine. Marc Wilson is the president of SFAA. He has been managing and selling San Francisco apartment buildings for 20 years. He can be reached at 415-229-1275. Copyright © 2005 by the San Francisco Apartment Magazine. All rights reserved.