Condo Association Management Blog

The Board of Dirtectors is responsible for defining the services that they wish the management company to provide. They shoukld not leave this critidcal definition to the Managementy Company to establish. I suggest that ajny management company you engage shoukld be licensed and insured per your state regulations and as a minimum. be able to provide all becessary financial support needs

On the header of this blog click on "Management Services" and take it from there

So duties does your management company do?

So what duties does your management company do?

I don't know what state you are in what prices are like, but based on what we have in CA $800 is very cheap. You an expect to pay that much here for a 30-40 unit building. 
 
As far as duties of a management company - it's whatever you want it to be. prices of course will fluctuate based on that. 
 
Some people want the manager to attend every board meeting, some don't. Some want their manager to do regular inspections of the building for rules enforcement and any potential problems. Most will do all association's accounting and collection of dues.

$800 per unit? If per month - too cheap...expect nothing but maybe accounting regardless of what the contract says...$800/mo..expect frustration. $800 per unit...I will sell my company and do it personally for $750 per home....almost

I agree with Jeff Ross that as far as duties of a management company - it's whatever you want it to be. I would also add that you will get what your Board expects, demands, and requires. So our Association pays for lots of services and get little because our current Board's current expectation levels are low. As for Jeff's comment that $800 is very cheap, I am not certain if Jeff read that that price is PER UNIT, not for all units.

As a property manager in Northern California, I have never seen such a high fee from a management company- we only charge $35.00 per unit. Most others will charge between $50-$125.

Lynn, thanks for pointing it out. I did indeed missed that his was per unit. I thought it was for all units. 
 
At $800/per unit is it per month or per year. I just can't be per months. That would mean you are paying $160K per month in management fees. Are you by any chance in California? If so I'd love to talk to you about my services :) 
 
If this is per year it comes up to about $66 per unit per months. That's still very very high.  
 
What are your HOA dues?

We have two people on our board who are insubordinate, the secretary and the board member at large. The secretary has exceeded her job description and does things for her own benefit, ex: writes documents undermining the president and passing them out to the owners at meetings instead of presenting them before the board. The member at large makes accusations that are untrue, ex: president sleeping with an owner. Totally unfounded. This is one of manh things she is lying about. She has said these things to the wrong people, people who know her and know how devious she is. What can we do?

$800 per unit per month?!!!! That is $160,000 per month for 200 unites which is almost 2 mil a year. If that is truly the case I would say you are paying way to much. However if it is $800.00 for all 200 units per month then that seems like a fair deal.  
 
I am in a 14 unit condo and our management company charges $500 per month total. That comes to around $35 per unit per month. I would double check that $800 per unit figure and if that is true then when your contract expires, get a different management company. 
 
When shopping for a new company, get multiple bids and see what services are offered. Also, if you have contacts at other associations try to get references and ask them about their management company. Most importantly, even if the they like the company, ask them how they like the manager assigned to their association. The manager assigned to you can make all the difference and don't be shy about requesting a specific manager.  
 
Our services cover bookkeeping, maintaining the HOAs records, correspondence with homeowners, collection and processing of HOA dues, filing liens and sending out late notices if an owner falls behind on dues, etc. Real estate fees are not included in this fee. However, those fees are paid by either the seller or buyer depending on their agreement.

Thanks to all who have responded.  
 
 
 
I am sorry for the confusion @Jeff is correct in that it is ~$70/unit/month and that previous number was per unit per anum.  
 
 
 
Since the management fee is a line item in our budget, I am forced to believe that some pay more and some pay less than that according to his/her percentage (we were formerly a co-op). It is difficult to give it as a percentage of maintenance since our bill is inclusive of all utilities and cable. 
 
 
 
My bigger question is if we were to hire Average Company X for say $50/unit what should I expect to be included? Should they be providing their own office supplies?  
 
 
 
Right now, our management company occasionally inspects the building, receives and writes checks, prepares necessary documents, attends meetings once monthly and has a representative on the premises 9am-3pm M-F.  
 
 
 
It all seems like a farce to me, but to be honest, I have no comparison/experience with which to judge.  
 
 
 
Should they have in-house payroll services? Should they be renting out our commercial spaces? Should they provide a super in-house? Would they take care of legal matter like pursuing arrearages? All of the above are currently contracted out separately and we pay vast sums for each. 
 
 
 
Thanks for everything thus far. Hope this clarifies things a little.

We are in NJ.

Michael, 
 
For $70/month per unit at at 200 unit building they should be doing it all and order you flowers weekly :) It's not a ridiculous price, but it's very expensive. 
 
Usually you'll find that fees go down on a per unit basis as the building gets bigger. Managing a 100 unit building is not double work of managing a 50 unit building. It's more work, but not double. 
 
Am I understanding correctly that the price they are charging you doesn't include a salary of the representative who is there daily. If it does include it than the fee is reasonable, but the questions is do you need it. 
 
It's not only what you should expect them to provide but also what you need. 
 
It sounds like you have some kind of maintenance crew on site or at least a super. Couldn't that person handle basic daily needs and report to the management company if there is a special need for something. 
 
As far as charging your for office supply I find it ridiculous. Do they buy a different pen for each property they manage? Or do they have a different rim of paper they use for each property. I think that should be the cost of doing business and included in your fee. 
 
I ran a management company (I am also a president of our board) which I would call almost a boutique. We specialize in small size condominiums and provide an all inclusive service. I don't want to nickle a dime my clients and I don't want them to think before they want to ask me something. I am there to help them and be their trusted adviser. 
 
My fees are structured as a flat fee for service which includes the following: 
- normal managing activities 
- monthly inspection of a property 
- attending one all owners meeting per year 
- attending 3 board meetings per year (we can attend more but there is premium for it) 
- all regular mailings including invoices to owners, paid checks to vendors, monthly financials to the board. We do encourage use of email when possible to cut our costs if it's not working we go along with it. 
- unlimited number of phone or email consultation with board members 
- Annual budgets, and year end financials 
 
We do charge some additional fees for collections, real estate transfers, and few other things. However most of our fees are being billed to individual owners or buyers, not HOAs 
 
Because we mostly manage smaller (up to 100 units buildings) we don't deal with on site staff. 
 
Your experience will be different because of on site staff, but it should give you an idea. 
 
I would say that in your case they should definitely be involved in renting your commercial space. Collection of dues they may do some initial letters but should transfer it to a collection company with board's approval. Same for legal and complex accounting. It's better left to attorneys and CPAs 

A property manager that is highly knowlegeable in condominium law, Robert’s Rules of Order, creating budgets, and biding out contracts for major projects is worth his or her weight in gold! Four years ago we had a “property management” company that was sorely lacking in all of these categories which ended up costing the association thousands of dollars and lots of strife. We then found our current PM and cherish him and the company for their excellent skills and sound management policies. We pay a little more but have recovered the increase by avoiding needless problems that we experienced before.

The inherent problem with the property management business model is that it is not aligned with the best interests of their HOA clients. Specifically, the PM company avoids exceptions to their policies and daily operating procedures to save time, which may cost the PM money. I have never found a PM to dispute an invoice from a vendor: it is much faster to pay it than discuss it. There is no way to estimate how much money is slipping through your fingers because of this conflict of expectations.  
 
Here is a real world example: our building is undergoing repairs, and extensive scaffolding has been erected. One of the neighbors advises our PM that the plants in our courtyard are dying. The PM contacts the landscaper, who says that it's too dangerous for his crew to work around the scaffolding. So, we are paying the PM to inspect the property, but he is not. We are paying the landscaper to maintain our plants, and he is not (notice that the landscaper never brought the matter of access to the attention of the PM, but continued to charge our HOA full price for something less than full service). We now have a new landscaper, who has had to purchase several hundred dollars worth of plants to replace those that have died, but would not have if they had been watered. The last insult is that the old landscaper sends a final bill to the PM, which the PM pays! I asked him why he paid after all this, and he said that he had to! Altogether, this fiasco cost out HOA almost $1,000. Everyone in the HOA "food chain" got paid even though no one but the new landscaper has done his job.

Hi Jeff - what would a condo association reasonably expect to pay for the services you describe in your post of October 27, 2011 1:40 PM?  
 
We are considering hiring a PM to do exactly this & we are in the DC area.

Jeff - *Clarification* - our condo building only has 4 units. Thanks!