Hiring a property manager is one of the most important financial decisions you will make as a rental property owner. The right manager protects your investment, maximizes your returns, and gives you genuine peace of mind. The wrong one can cost you thousands in lost revenue, deferred maintenance, legal exposure, and tenant problems.
I have been in this industry long enough to see both sides. Here is what to look for, what to ask, and what should make you walk away.
10 Questions to Ask Any Property Manager Before Signing
These are not softball questions. A good property manager will answer every one of them clearly and confidently. If they dodge, deflect, or get vague, that tells you everything you need to know.
1. Are You Licensed?
This is question number one for a reason. In California, anyone managing long-term rental properties for others is legally required to operate under a Department of Real Estate broker license. No exceptions.
Ask for the broker license number. Verify it on the DRE website (dre.ca.gov). If the property manager tells you they do not need a license, or they are "working on getting one," that is your cue to leave.
For short-term rental co-hosting, the licensing requirements are different — co-hosts typically operate under a business license rather than a DRE license. But if the co-host also handles long-term rentals, they need the DRE license for that side of the business.
At Damian's Hosting Hub, our long-term rental management operates under a CA DRE licensed broker partnership. This was a deliberate choice. It costs more, takes longer to set up, and requires more compliance — but it protects our owners.
2. How Do You Handle Owner Funds?
This is where the licensing question becomes practical. A licensed property manager is required to hold owner funds — rent, security deposits, maintenance reserves — in a regulated trust account that is separate from their personal or business operating account.
Ask specifically:
- Do you use a trust account for owner funds?
- Is the trust account audited?
- How are security deposits held?
- What bank is the trust account with?
If the property manager holds your rent money in their personal checking account (which is what unlicensed managers typically do), your funds have zero protection if the manager runs into financial trouble, makes a mistake, or disappears.
3. What Is Your Fee Structure?
Get the complete picture. Property management fees should be clear, documented, and fully disclosed before you sign anything.
For long-term rental management, typical fees include:
- Monthly management fee: 8-10% of collected rent
- Tenant placement fee: 50-100% of first month's rent (one-time, when a new tenant is placed)
- Lease renewal fee: $0-200 (some managers charge this, some do not)
For short-term rental co-hosting, typical fees include:
- Management fee: 15-25% of net booking revenue
- Onboarding/setup fee: $0-500 (one-time)
Ask about fees that are not listed in the headline rate: maintenance markup, after-hours fees, inspection fees, accounting fees, lease preparation fees, advertising fees. A manager with a low headline rate and a dozen hidden fees may cost you more than a manager with a straightforward higher rate.
4. What Does Your Management Agreement Look Like?
Read the contract before you sign it. I know that sounds obvious, but you would be surprised how many owners sign management agreements without reading them.
Pay attention to:
- Contract length. Month-to-month is ideal for owners. Long lock-in periods (12-24 months) benefit the manager, not you.
- Termination clause. How much notice is required? Are there early termination penalties? What happens to the tenant or bookings if you leave?
- Scope of authority. What can the manager do without your approval? Is there a spending threshold for maintenance?
- Liability. What is the manager liable for? What are they explicitly not liable for?
- Ownership of listings. For STR management, who owns the Airbnb/VRBO listing and the reviews if you terminate? This is critical — if the manager owns the listing, you lose all your reviews when you leave.
5. How Do You Screen Tenants?
For long-term rental management, tenant screening is arguably the most important thing your property manager does. A bad tenant placement can cost you $5,000-20,000 in lost rent, damage, and legal fees.
Ask about their screening process:
- Credit check (minimum score threshold)
- Background check (criminal, eviction history)
- Income verification (standard is 3x monthly rent)
- Employment verification
- Landlord references (at least two prior landlords)
- How they handle applicants who do not meet criteria
A good property manager has a documented, consistent screening process that complies with fair housing laws and local ordinances.
6. How Do You Handle Maintenance?
Maintenance is where property managers either earn their fee or cost you money. Ask:
- Do you have in-house maintenance staff or use third-party vendors?
- How do you select vendors? Are they licensed and insured?
- What is your emergency maintenance response time?
- What is the approval threshold — at what dollar amount do you contact the owner before authorizing a repair?
- Do you mark up maintenance costs?
- Can you provide examples of recent maintenance requests and how they were handled?
7. What Reporting Do You Provide?
You should receive a detailed monthly report that includes:
- Rent collected (or booking revenue for STRs)
- Expenses itemized with receipts or invoices
- Net income disbursed to you
- Property condition updates
- Market observations or recommendations
Ask to see a sample report. If it is a single page with three numbers on it, that is not adequate reporting. You need visibility into what is happening with your property and your money.
8. How Many Properties Do You Manage?
This tells you about capacity and attention. A solo operator managing 100 properties cannot give each one the attention it needs. A team managing 30-50 properties with dedicated staff for each function is a different story.
Ask about their team structure:
- Who specifically will be your point of contact?
- How many properties does that person manage?
- What happens when your contact is on vacation or unavailable?
9. What Is Your Vacancy Rate?
For long-term rental managers, ask about their portfolio-wide vacancy rate. Industry average is around 5-8%. If they are significantly higher, ask why. If they do not track it, that is a problem.
For STR managers, ask about portfolio-wide occupancy. In the Central Valley, well-managed properties should achieve 60-75% annual occupancy. Below 50% consistently suggests pricing or marketing issues.
10. Can You Provide Owner References?
Any property manager worth hiring should be happy to provide references from current clients. Ask for at least three, and actually call them.
Questions for references:
- How long have you worked with this manager?
- How responsive are they to your questions and concerns?
- Have you had any major issues? How were they handled?
- Is your property earning what they projected?
- Would you recommend them to a friend?
The DRE Licensing Question: Why It Matters
I mentioned licensing as question number one, and it deserves more explanation because this is one of the biggest risks in Central Valley property management.
California Business and Professions Code requires anyone who manages residential property for others — specifically anyone who collects rent, negotiates leases, or manages trust funds on behalf of property owners — to hold or operate under a DRE broker license.
Here is what happens when you hire an unlicensed property manager:
- Your money is unprotected. No trust account requirement means your rent and security deposits sit in someone's personal account with no regulatory oversight.
- Your lease may not be enforceable. Unlicensed managers often use generic templates that do not comply with California's specific disclosure requirements, habitability standards, and tenant protection laws.
- You have no regulatory recourse. If a licensed manager mishandles your funds, you can file a complaint with the DRE. If an unlicensed manager does the same thing, your only option is civil court — which costs you more money.
- You may be liable. If your unlicensed manager violates tenant rights or fair housing laws, the liability can flow back to you as the property owner.
This is not a theoretical risk. We have onboarded properties from owners who previously used unlicensed managers and discovered leases with illegal clauses, security deposits held in personal Venmo accounts, and maintenance records that did not exist.
Fee Transparency: What to Expect
A transparent property manager publishes their fees, explains them clearly, and does not surprise you with charges that were not in the agreement.
Here is what our fee structure looks like at Damian's Hosting Hub for context:
Long-term management: A flat percentage of collected rent with a one-time tenant placement fee. No lease renewal fees, no inspection fees, no accounting fees, no maintenance markup. Cleaning and repair costs are billed at the vendor's actual cost with documentation.
Short-term co-hosting: A flat percentage of net booking revenue. No onboarding fees for standard properties, no per-booking fees, no hidden platform charges. Cleaning is billed at the cleaner's actual rate.
If a property manager cannot give you a clear, complete breakdown of every fee you will be charged, keep looking.
5 Red Flags That Should Send You Running
Red Flag 1: No License
If they manage long-term rentals in California without a DRE broker license (or operating under one), walk away. No exceptions, no excuses, no "we are in the process of getting it." This is the law, and it exists to protect you.
Red Flag 2: Vague or Complex Fee Structures
If you cannot understand the fee structure after a 10-minute explanation, it is designed to be confusing. Complexity in fee structures always benefits the manager, not the owner. Look for simple, transparent pricing.
Red Flag 3: Long Lock-In Contracts
A property manager who requires a 12 or 24-month contract with early termination penalties is telling you something: they are not confident you will stay voluntarily. Good managers offer month-to-month agreements or short contract terms because their results speak for themselves.
Red Flag 4: No Reporting or Minimal Reporting
If the property manager does not provide detailed monthly reports — or says they provide reports "on request" — that is a problem. You should never have to ask for information about your own property and money. Reporting should be automatic, detailed, and regular.
Red Flag 5: Slow or Unresponsive Communication
Pay attention to how responsive the property manager is during the sales process. If they take two days to return your call when they are trying to win your business, imagine how responsive they will be six months in when they already have your signed contract. Communication quality during the sales process is the best predictor of communication quality during the relationship.
How DHH Measures Up
I am obviously biased, but let me walk through how Damian's Hosting Hub stacks up against these criteria:
Licensed: Our long-term rental management operates under a CA DRE licensed broker partnership. Trust accounts, compliant leases, regulatory oversight.
Transparent fees: Simple percentage-based pricing. No hidden fees, no maintenance markup, no minimum monthly charges. Everything is documented.
No lock-in contracts: We offer flexible terms because we are confident in our service. If we are not earning our fee, you should be free to leave.
Detailed reporting: Every owner receives comprehensive monthly reports with income, expenses, occupancy data, and property condition updates.
Responsive communication: This is the firefighter in me. When you call, we answer. When something happens with your property, you hear about it from us — not from your tenant or your guest.
References available: We are happy to connect you with any of our current property owners. Our 5.0 Google rating and zero owner turnover tell the story, but we want you to hear it directly from the people we work for.
Making Your Decision
Choosing a property manager is a significant decision. Take your time, ask hard questions, verify credentials, and trust your instincts. A good property manager will welcome your diligence because they have nothing to hide.
If you would like to talk through your options — whether you are evaluating us, comparing us to another manager, or just starting your research — reach out any time. We are happy to answer every question on this list and any others you have.
Call us at (209) 638-6140 or visit our contact page. No pressure, no sales pitch. Just honest answers from people who manage properties for a living and treat every one like it is their own.
Damian Garcia is the founder of Damian's Hosting Hub, managing 31 properties across California, Texas, Georgia, and Florida. A San Francisco firefighter for over 20 years, Damian built DHH on the same principles he brings to the firehouse: accountability, rapid response, and doing the right thing even when nobody is watching.