Management Company and Building Maintenance

Our HOA is on the cusp of securing a professional management company. We have been self-managed since the inception of the community (late 1970's) with volunteers running the show (and not doing a good job at it until a few years ago).

My specific question is when a management company secures bids for building maintenance (ie. roofing, siding, etc.) are you taking their word for it that they are competitive bids and using reliable contractors?

Right now, we require the Association to use licensed and insured contractors in every facet of repair. We generally secure 3 bids for any work to be done. We also use local contractors. We live in a relatively small rural county, so we're familiar with their work - which ones are good and which ones aren't. The closest professional management company available for our use is 1.5 hours away in the "big city". There is some concern that they would hire contractors from out of the area and that they would charge quite a bit more. I'm just curious how you deal with this sort of thing.

Also, does your professional management company routinely inspect the premises to look for anything that may need repair or do you have your Building Committee do that or rely on homeowners or ???

Thanks!

I think your concern is justified. Hire local and hire trusted contractors.

It's all a matter of negotiating the right contract and not just accepting the terms imposed by the management company.

Are you on the Board, Linda?

Whatever the case, as Larry says, the board enters into a contract with a Management Company (MC) and the board specifies what it wants. One example is three bids from licensed,, blah, blah, local contractors ( or within X miles radius.) The contract also will say that the property manager (PM) will conduct xx walkarounds a year and inspect, xx, xx, xx. Her/his written reports will go to the board for its review.

So, the contract includes what your board thinks a MC should do and what your HOA can afford. Do you, for instance, want an onsite manager full-time? O r Portfolio mgr. who manages perhaps several accounts an in on your premises, say 12 hours a week? Or?

How many homes are there in your HOA? Detached? What amenities do you have?

Hi Linda

I have often wondered whether some MCs are more concerned about good relations with their contractors than with their HOAs. This includes concerns about favoritism, kickbacks, etc. Around here at least, I have seen several MC contracts that stipulate that if the MC is terminated, then any contractor the MC brought in must be paid in full. I have had those clauses stricken (because we reserve the right to withhold payment for inadequate performance). I don't think that the MCs even knew about the clause, but the contracts were written to protect the interests of the MC against the HOA.

What struck me about your post is that you said that volunteers have been doing a good job finding local contractors. Why would anyone want to turn that over to someone far away?

To minimize the burden on volunteers, we have gone to signing 3-year contracts. But we have gone to the added burden of writing our own RFPs - We know our needs better than any MC. We no longer rely on an MC other than to provide a recommendation in an emergency.

Our MC does not do site inspections for us. Our board members walk the grounds often enough with our snow contractor, landscaper, landscape designer, and arborist, that we see what's going on. About 8 years ago, we had a PM who walked the grounds every 2 weeks and sent out nasty letters on anything she found. I think everyone is happy that those days are gone. The hardest part about using an outsider is finding someone who can get into the rhythm of how the HOA wants to be managed.

Linda

We recently hired our first Management Company. We interviewed 3 companies. They all quoted several prices depending on their services. We chose to do on site inspections by the BOD with us reporting violations to them thus not costing us as much.

Maybe you are expecting/wishing to much from them thus I am suggesting be selective on the services they provide. As an example. We have drawn up a spread sheet of what landscaping services we want. We asked the MC to comment on it and they had some suggestions. We modified it and now our MC is going to distribute it to several landscaping companies they do business with. We are giving it to our present landscaper to quote on. We (the BOD) will make the final decision, not the MC.

Again, my overall suggestion is pick and chose the services you want and are willing to pay for. Do not go overboard and pass all functions to a MC. Some "decisions" are best left to the BOD, versus a MC. After all, you all were making all the decisions before so you have some knowledge/experience so use it.

Thanks for your replies - you are a WEALTH of information!

One posted asked: What struck me about your post is that you said that volunteers have been doing a good job finding local contractors. Why would anyone want to turn that over to someone far away?

We have no local property management companies. They are all in another county. That is a definite concern. On top of that, another concern is if repairs and response to homeowners will be done in a timely manner.

We have 48 townhomes in our community with a community clubhouse. This place was a HUGE mess about 5 years ago. HUGE would be an understatement. A past president of the Board had her non-licensed contractor husband do alot of work which we've been correcting because it was so shoddy. Other contractors charged exhorbitant fees and unknowledgeable Board members just signed the checks. Another past President (I actually had her removed) managed to talk the Association/Board into getting her a new front door as well as interior flooring, painting and who knows what else. She tried it again when I was on the Board and I caught it and it was stopped. I could go on and on. It's really incredible. Most of the residents are elderly widows or senior couples which makes it hard to get anyone to do anything in regards to volunteering. But when you have the volunteers who do things, all the others do is complain. They don't want a management company stepping in because it's going to "raised their dues". Okay - I will stop here. I could make a whole other post on this!

Right now, I am Secretary on the Board, as I have been for 5 years. My husband is the Building Committee Chair. We also have a Maintenance Manager and a solid list of contractors we use, as well as a regular licensed and insured handyman. Everything is going great in that regard. My concern is that I am handling most of the maintenance work myself on a volunteer basis. It can take anywhere from 5-20 hours per week to do this, on top of my regular secretary duties and things pertaining to community violations, etc. Maybe I'm afraid of letting go for fear of things not getting done? I just would like to know how people feel about their management companies. We have a few people who own townhomes in our community that have lived elsewhere in our county and were very unhappy with the management companies and let us know it - so that makes it hard to try and promote getting one.

Tim's advice makes sense, Linda. But, tell me, with a "maintenance manager" and a licensed handyman, how is it that you (& your husb.?) are doing so much maintenance yourselves? I think I'm missing something.

Are there some aspects of the town homes's maintenance that your HOA is responsible for?

Meant to mention - we generally use one contractor and one handyman, as we've used them for a few years and they are highly reputable and do great work and available on relatively short notice. I create weekly punch lists for them to do as repairs are needed. It's always something - these buildings were built in the 1970's and had many problems. They were built in "sections" at different time periods. One of the builders was cheap - another was not reputable and decades ago, the Association actually sued (and won) to complete major construction defects. On top of that, we have composite decks (lots of them!) that are falling apart and needing replacement (Trex Warranty claims). It is always something.

EllieD,

The company in the city wants to charge upwards of $1,000 per month for management. The fact that they are so far away is a concern. We would be operating at a distance with them and only by phone - not much in person.

Main reason for soliciting a management company is burnout. :-) There are five Board members. Four are seniors who are there to warm a seat. The 5th is me and I'm basically doing everything with my husband. If we were to quit right now, everything would go back to the way it was. We are 65% funded in our reserve which is above industry standard in California. Everything is running quite smoothly and is very well organized. Without sounded facetious, I think we're doing a great job and have also been told as much. We own 3 townhomes in this community, so we have a vested interest in seeing things being taken care of and not having homeowners or the Association get ripped off.

You & your husb. are doing a great job, Linda, by getting your HOA back into shape. $1,000/mo sounds like a lot for long-distance mgmt.

Could your HOA hire a part-time onsite handyman? Is your husb. the only active building comm. member?? Can other step up and give him/you more help? Do you have a landscape committee? Would that help?

I entirely understand your need to keep on top of everything given your big investments and the fine progress you've made!

It does seem though, that you need someone 2-3 days a week, like a handyman, to walk the premises, check lighting, etc. and write reports to you/the Board.

KI do think you're doing a fine job. If you have a newsletter, maybe try to encourage more H/Os to serve on your committees.

so, you are saying that your HOA is responsible for homes' roofs and window leaks?