If you have an out of state property manager, can you trust them?

Wife's aunt lives in CA. She owns a cabin in Hot Springs Village, AR. She rents out this furnished unit sometimes but will occasionally go there when not rented.

Anyway, she checks with the PM and he tells her the place is currently vacant (no rent coming in). Well she decides to take a road trip. Gets to the cabin one evening, unpacks her things and goes to bed.

She is awakened in the night by the (non-existent) tenant screaming at her to get out of his house. Probably lucky she wasn't shot or hurt.

NE, this is a gated community. Unless you live in the community or have permission to get through, you don't get in. I'm sure changing locks is not something most people would worry about there.

I actually do property management for people and many are out of state owners. I know they trust me - because if they didn't I wouldn't be managing their properties. In addition, if I don't trust them - I wouldn't be managing their properties.

It goes both ways.

This one sounds a bit off though … she rents it furnished? Is this an Airbnb or something? I don't think I would expect any of my owners to just "show up" and open the house up and sleep there (and amazingly enough I DO actually change out the locks after turnovers so they most likely wouldn't even have a key for the property without coming to me).

Is the property advertised for rent? Is there a sign anywhere (if allowed in that community) or did you (or your Aunt) look to see if there is anything on line about the rental being available?

I would look for that as well as (obviously) call the manager to see what is going on. Maybe the manager just placed someone and they haven't contacted your Aunt yet?

I can't imagine that she just walked in, didn't notice that someone actually lived there and then just jumped in bed. That's odd.

I just re-read your post - so I'm thinking this is most likely more of an Airbnb thing so no, I wouldn't change the locks out as it sounds like it's more of a "short stay" thing.

With that said and if it's true - couldn't the manager end up getting a "tenant" today for a week or whatever? Does she expect to be told EVERY TIME there is a guest (or tenant)?

Rule #1 in rentals: You have to be 20 minutes or less from your rentals.

I live in CO and through an acquaintance had purchased 4 SFH rentals in south Texas. After 8 years, I sold them all. The main reason - I just didn't trust the PM. There are 2 aspects to this.

First, there is no way that they worked as hard to make money for me as I would have. I have no doubt that they did not perform the types of background checks that I do, and they certainly didn't discriminate on their tenants, as I had bad tenant after bad tenant. They rarely stayed more than a year or two, and most left pretty heft damage on leaving - of course there was almost never enough SD to cover it.

Second, I just didn't trust them. I made a secret trip down there. I interviewed potential new PMs, though I hadn't made a decision yet whether to make a change. I visited one of my rentals to meet the residents, and there was no hot water. The heater had broken 2.5 weeks earlier. I remembered giving immediate instructions to fix/replace the water heater within minutes of getting the email about it, 2.5 weeks earlier. But the PM never did the replacement. I called the next morning and asked the PM the status of the water heater. "Oh, we replaced that 2 weeks ago." Really. I wrote up a termination letter, called one of the people I had interviewed to hire him as the new PM, and gladly delivered the termination letter to the old PM in person.

He had been living there for three months.

I told her she should fire him immediately and get all the money he owes her or sue him. She chose not to because she didn't want to "cause a problem."

In California I had an interest in a large apartment complex many hours away from my home. Since I was only a 20% partner, and no one appreciated my expertise -- I allowed the property to be run by a licensed professional management company. They put a couple in the property to be the resident managers.

So one day I logged in to a hidden exterior hallway camera's. I saw new carpeting being installed in one vacant unit and the bill going to the management firm. Then the next day the new carpet was removed from the unit and reinstalled into a second unit. The old carpeting was put back in the 1st unit and shampoo'ed. Another bill was sent out to cover the cost of a second unit being carpeted. They management team did the same type of fraud when it came to painting, blinds, etc. From $90,000 in general expenses, it was really only $20,000 being shuffled around.

My partners didn't want to rock the boat. I filed a claim against their insurance/bonding company and collected a nice settlement.

When I was a teenager we lived at a ski resort. My mom's company managed 400 vacation condos. As I recall she got some of our contracts because of PMs who would rent units and not report the income to owners or bill bogus charges.

Even back in the '70's the units rented for about $100 a night. A PM could skim a LOT of money renting units without owners catching on. Even when they got caught the owners would not usually prosecute. Most owners lived in LA and didn't want to go to court 350 miles away.

We had to watch our own on-site managers too. We got serious snow and some would rent to walk ins and pocket the money thinking nobody would check the register at night with a foot of fresh snow on the road.

I don't want to give the impression that crooks were the norm. Those were isolated incidents. I think most PM's are honest. Like any business deal you just need to check them out ahead and put in a process to keep them honest.

Well JB[OR] - then obviously that PM is dishonest. You didn't indicate that the person lived there for 3 months (at least, I didn't see that in the original post if you did).

So this PM is NOT skimming - they are taking the entire thing. Hope that your Aunt is speaking with the PM and advising them at least that they need to pay her for the past three months? If not then she needs to get out of this business for real.

Whose name is on the utilities (who pays for them)? I'm thinking your Aunt if this is fully furnished and (again, unless I'm missing something) potentially all "inclusive". Wouldn't she see that the utilities were being used (versus staying pretty consistently low for a vacancy)?