UPDATED! Why does a Community Association Management license matter when hiring a property manager?
In addition to licensure, condo boards need to get tough on contractor cancellation rates
Writer's note: This post has been updated and was originally published on September 5, 2023.
A year or so after I moved into my condo unit, I will never forget a comment one of the condo board members made to me: “Being on a condo board is a thankless job.” At the time, I wasn’t on the board so I heard her say it but didn’t think much of it. It’s not until you’re actually on a condo board and working with an association on a day-to-day basis that you realize just how much work is involved in this voluntary position. It’s very easy to understand why condo associations often don’t stay self-managed for long, even when they’re fairly small.
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Unfortunately, because of the workload, self-managed condo boards may be too frantic to hire anybody to take over all the daily duties. Some of the worst decisions (and choices) can be made by not doing the following when hiring a property manager/Community Association Manager:
reviewing relevant (and mandatory) licensing requirements within your state
reviewing your city's Small Claims directory for prior lawsuits against this company
checking the Better Business Bureau to see if the property management company is accredited and how prior reviews were handled
verifying the monetary terms of a contractor cancellation request
understanding what the monthly rates include and what’s an extra charge
identifying what the board will still oversee versus what the management company is in charge of
reading any relevant documents (Rules and Regulations, bylaws) to make sure that your condo association’s legal documentation, the management company’s ideas of how your association should be run and state condo board laws are in alignment
Every condo board member may not be as responsible as the next. In fact, some may be the equivalent of decoration to fill a quota of three to five members while others are excited to grab the bull by the horns. Sometimes, the same person can be both — passionate and showing their leadership in one area and indifferent in the next. But when working with a property manager, being a united front is imperative.
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No matter which condo board member you may be, it is very important to make sure that for-profit management is respectful to all of you. Never engage with a property management company (i.e. Community Association Manager) who may regard condo board members’ opinions as “insignificant” and decide to manage the building as they see fit — regardless of your bylaws, Rules and Regulations, and state laws.
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How can condo boards avoid this type of contractual nightmare? First and foremost, understand how someone can legally become a Community Association Manager (formerly referred to as a property manager). Second, do not sign any contracts before being 100% confident in the cancellation rate.