California law requires smaller apartment buildings to have a resident manager available, and there are some issues with the duties and responsibilities that property owners require of those managers. We’re talking about small apartment buildings with between 16 and 40 or even up to 50 units. There isn’t always enough work for a full time manager, and we have seen a lot of property owners try to put too much faith in their resident managers.
In some cases, resident managers are expected to handle everything from leasing, to rent collection, to maintenance, to posting legal notices and helping with evictions. Everything that the property owner needs seems to be put into the resident manager’s hands. In smaller buildings, these managers are not always trained adequately, and that can cause some problems.
From an owner’s perspective, this creates a lot of liability. That resident manager has to be an employee, so you’re dealing with the risk that comes with managing employees. California employment law is strict and penalties are severe if you don’t follow the law. Potentially you can have a ticking time bomb. We encourage you to consider that.
More importantly, you don’t want to employ a resident manager who is doing things that he or she may not be trained or suited to do. Your resident manager might not know the fair housing laws while leasing apartments. If maintenance is being completed, the necessary licenses and insurance coverage might not be in place. Experience is required to properly post legal notices.
The solution is to use a professional off site property management company to take care of all the property management tasks. Then, the resident manager can focus on being the eyes and ears of the property. The resident manager can report to the off site manager what might be going on, and that will mitigate your risk. Also, the property management company will employ the resident manager, not you. That shifts liability off you.
If you’d like to talk more about the strategy and structure of using professional managers as well as resident managers, please contact us at Advantage Property Management Services.