Sadly, sometimes people have to leave the beautiful island of Oahu. And sometimes, those same people own homes that they would like to keep as an investment property. This is particularly true for our military service members, who typically call this island paradise home for a short period of time. So, what are your options if you own property here that you would like to keep as an investment property?
Hawaii law states: “Owners who reside outside of the State or on another island from the location of the transient accommodation, must designate a local contact.” House Bill 2078
This local contact does not have to hold a real estate license as long as they are only managing property for one owner. But while designating a friend or family member as your “local contact” may save money, it is advisable to find someone who has experience in managing rental properties when assigning responsibility to care for your investment.
When hiring a property manager for your rental home, it is always a great idea to get referrals from your military network, as well as family and friends. However, even with recommendations, you should do your due diligence and interview prospective property managers to see if they are someone you are comfortable with.
Interview Your Property Manager
- Do you charge a flat monthly fee or a fee based on a percentage of the monthly rental amount?
- Do you charge you a fee when the home is vacant?
- Are there additional fees for advertising, credit checks, signing/renewing lease agreements, showings, cleaning and utilities between tenants?
- How many units do you currently manage?
- What is the typical length of time it takes to fill vacancies?
- What methods will you use to market my home?
- Do you perform a security check and/or background check?
- Do you ask for and check personal references?
- Do you meet the tenant in person?
- Do you include a Military Clause in state specific lease agreement?
- How is collection of rent and disbursement of funds handled?
- Does the rental payment need to be received before the income check is delivered to the homeowner?
- Are you willing to set up a direct deposit for rental income?
- Do you provide me with a monthly statement?
- Do you provide me with a year end tax statement?
- How often will you visit my home for an exterior inspection?
- How often will you visit my home for an interior inspection?
- What is your payment policy for needed repairs? (maintenance fund vs. deducted from rent)
- What hours/days are you available for my tenants to call with repair issue?
- What is the average turnaround time on repairs/maintenance issues?
- At what price point is my authorization necessary for costly repairs?
- Do you utilize a network of contractors to do work on the homes, or do you seek outside quotes?
- How is the cost and clean up from the previous tenant handled?
- Will I receive a report on the tenant’s return of security deposit?
- Will you help me file a claim against a tenant for damages above and beyond security fees?
- Will you handle court orders/evictions, if necessary?
- Are you willing to oversee necessary remodeling of the home?
- Why should I hire you as my property manager?
Being a landlord can be hard work unless you have the right person aiding you. Don’t be afraid to ask direct questions and expect direct answers. Remember, this is your investment, so find someone who will care for it the way that you would.
If you have grown tired of being a landlord, contact me to help you ease your burden by selling your Hawaii real estate investment.