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Subject: Remote property management
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Author Messages
JackJ9
(Oregon)

Posts:28


06/07/2021 11:06 AM  
We spend about $27,000 per year for property management for our association of 274 single family homes. Our property manager does the accounting, collects the dues, pay the bills, does a couple site visits to look at homeowner property condition each year, and also handles homeowner communication. Pretty much everything else we handle.

All of these tasks, except for the couple of site visits, could be handled remotely by someone in a different part of the country.

I just sent out an inquiry to a property management company that advertises remote HOA management.

Wondering if anyone else has explored using non-local property management companies, and what the experience is. Is there decent cost savings that might be realized by using a different property manager?
MaxB4
(Maine)

Posts:382


06/07/2021 11:22 AM  
Currently your paying $2250.00 or $8 per door for management. The national average is about $10.00 per door, for single family detached. How much are you looking to save.

Could it be done remotely, absolutely. As long as the vendor has software that is compatible with any Oregon regulation for applying payments to a homeowners account. Many management companies will have access to ACH, bill payment, charge card payment and so forth. Reports and documents can be loaded onto a web portal for both homeowners and board members. Bill payments for vendors can be authorized authorized via the web portal prior to a check being cut.

So yes, this is an easy process.
BarbaraT1
(Texas)

Posts:444


06/07/2021 12:06 PM  
Does your state require property managers to be licensed? If so, your out of state manager may not be able to practice. Is there anything in the governing documents or state laws that would require your managing agent to be in the same state?

You will want to ensure you have sufficient board or committee volunteers to handle compliance inspections, meeting vendors, responding to emergencies, etc.

There are managers who think you can do the job from behind a desk, and those who think you can't manage a property without spending time on it. I'm the latter camp, personally, but I think there's a difference between management and admin tasks and what you're talking about sounds more like admin tasks.

MaxB4
(Maine)

Posts:382


06/07/2021 12:45 PM  
Currently, Oregon does not require HOA managers to be licensed. They do require that property managers handling rental properties have a real estate license.

I was responding to a question of remote management, which would be a mix of financial and administrative tasks. How tasks are divided up is a board decision. If they want to reduce costs and do some of the onsite management, more power to them. One thing to consider though is what happens if members start seeing correspondences from say Alabama and they send their check to a lockbox in Arizona, will they revolt and seek a new management company.

I pitched the idea of self-management to the community I lived in. The other board members didn't want any responsivities except to just show up to a board meeting.

Can you help manage a property sitting behind a desk, YES, as long as your have the technology and have team players to support you.

CathyA3
(Ohio)

Posts:2021


06/08/2021 6:40 AM  
Issues with non-local management:

* Who is responsible for maintaining the association's records? If you have delegated that to the PM (and many communities with full-service PMs do so), then you will have to make arrangements for that to be done locally. This will include records retention, physical security, and providing access to owners who request it.

* Community walk-throughs and other day-to-day, hands on duties are out. This will include managing your community's contractors. These duties will have to be picked up by the board, and will have to be handled during normal business hours.

* Emergency response is more difficult at a distance, for no other reason than the PM won't know what's going on.

My advice: think twice about this. There are definitely jobs that can be handled remotely, but others can't - which means in practice that the board will need to absorb some of the PM's normal duties. Does the board have the time (and willingness) to do this?
CathyA3
(Ohio)

Posts:2021


06/08/2021 6:53 AM  
One other thought: consider how you will manage a PM who is remote, particularly one who is handling your money. Things that can go wrong locally can also go wrong remotely, and your ability to catch and resolve issues may be complicated by distance and out-of-state laws.

CathyA3
(Ohio)

Posts:2021


06/08/2021 7:46 AM  
Final thought (my brain is on the slow train today):

Think about what you hope to gain by moving to remote property management. Are there advantages to doing this that you can't obtain locally? If there are, do these advantages outweigh the potential disadvantages? Can you accomplish the same goals by staying local?

As I see it, the main disadvantages to going remote are the added complications of managing your money manager when they're not close. You can partially offset the risks by having enough employee dishonesty insurance coverage, but you're better off not needing to use this insurance at all.

Many corporations have the resources they need to handle remote workers just fine, but most HOAs don't have those resources available - everything falls onto volunteer board members who may not have the time or skills needed. HOAs also typically run lean and mean, and may not have the same ability to recover if things go sideways.
JohnT38
(South Carolina)

Posts:602


06/08/2021 7:47 AM  
"* Who is responsible for maintaining the association's records? If you have delegated that to the PM (and many communities with full-service PMs do so), then you will have to make arrangements for that to be done locally. This will include records retention, physical security, and providing access to owners who request it."

I see this as a very minor issue. I wouldn't hire a PM that was not fully utilizing technology. Physical security is a non issue if the records are electronic and access is setup properly. Providing 99% of anything asked by an owner can now be sent electronically. Record retention electronically is much easier than paper records. Signatures can now be done electronically. I'm not saying there might be a rare exception to this but as a whole managing records remotely is not an issue.
JackJ9
(Oregon)

Posts:28


06/08/2021 8:05 AM  
Thanks all.

I received some semblence of a proposal, less cost, of how much we'd pay for a remote property manager. in the proposal was a list of tasks that we would have to start doing on our own.

Big item - community walkthroughs and property inspection. This is a huge reason that our HOA exists, in that everyone does a nicer job of keeping their property looking nice when they know someone will drive by periodically to check on it. Plus if they don't, they get reminder letters to make their place look a bit nicer.

If we look at why we exist as an HOA, this is probably the #1 reason.

Since a remote property manager can't do this task, and since we don't want to start doing this task, we cannot go with a remote property manager.
JanineR
(Tennessee)

Posts:103


06/10/2021 8:26 AM  
Jack19, can you share the list of tasks?
I'm hoping in our community, that next year we put together a request for proposal to property managers.
Most of the owners are not happy with the current.
Your list will help us to get a start on compiling a RFP.
JackJ9
(Oregon)

Posts:28


06/10/2021 10:18 AM  
Posted By JanineR on 06/10/2021 8:26 AM
Jack19, can you share the list of tasks?
I'm hoping in our community, that next year we put together a request for proposal to property managers.
Most of the owners are not happy with the current.
Your list will help us to get a start on compiling a RFP.




Sure. The remote property management company we talked to does NOT do the following services:

*Respond to homeowner requests for maintenance, violations, architectural changes
Manage vendors
Coordinate repairs, negotiate contracts, review bids, etc.
*Run board and homeowner business meetings
*Property walkthroughs / inspections
*Complete Secretary of State forms each year

The ones with an asterisk are ones that we do not currently do, and do not have interest in doing ourselves.
CathyA3
(Ohio)

Posts:2021


06/11/2021 4:46 AM  
Posted By JackJ9 on 06/10/2021 10:18 AM
Posted By JanineR on 06/10/2021 8:26 AM
Jack19, can you share the list of tasks?
I'm hoping in our community, that next year we put together a request for proposal to property managers.
Most of the owners are not happy with the current.
Your list will help us to get a start on compiling a RFP.




Sure. The remote property management company we talked to does NOT do the following services:

*Respond to homeowner requests for maintenance, violations, architectural changes
Manage vendors
Coordinate repairs, negotiate contracts, review bids, etc.
*Run board and homeowner business meetings
*Property walkthroughs / inspections
*Complete Secretary of State forms each year

The ones with an asterisk are ones that we do not currently do, and do not have interest in doing ourselves.



In short, they are bookkeepers/accountants only.

Of course you know your community and your area better than I do.

But I have to question what benefit you receive from moving these functions that you can't get locally, or if those benefits outweigh the costs and risks involved.

Under costs I include adequate fidelity/employee dishonesty insurance and thorough annual audits of the books. Under risks I include the barriers to effectively managing someone whom you don't know, can't talk directly to, and who is located somewhere you may not be familiar with and won't be hearing the latest scuttlebutt from. Not to mention that you may have to deal with inter-state issues if things go badly sideways - think about what would happen if your audit turns up evidence of embezzlement and you have to take legal action against someone in a different part of the country.

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