A CHECK LIST FOR SELECTING A MANAGER
If you treat your property investment as a serious business, and want to maximise your returns over the long term, you realise the importance of effective property management.
You have the choice of managing your investment properties yourself or delegating the day-to-day management to managing agents, we believe engaging a Property Manager is the preferred option for investors in today's more complex property market.
Choose your Property Manager wisely as this can make a great difference to the real return you achieve from your property and a poor choice can change a great investment into a troublesome asset. Agents normally charge between 7% and 9% of the rental collected to manage the property. We also charge a fee to find a suitable new tenant each time we lease the property for you.
If you find the right Property Manager, these fees won't be a cost but should be an investment. A good manager should minimise vacancies and find you good tenants who pay market rentals and don't damage your property while shielding you from the hassles of maintenance and dealing with tenants.
10 KEY QUESTIONS TO ASK YOUR PROSPECTIVE AGENT 1.
Does the agency have a dedicated Property Management Department and how many staff will be looking after your property? Many agencies see property management as a "poor sister" to the more glamorous sales department. Some even leave the management of client's assets to the front desk staff and receptionists. Ensure that your agent has a dedicated property management department.
It is preferable if the department is staffed by a number of experienced people so there is continuity of management if one Property Manager becomes ill or leaves. You may find that an agency where the director has an active involvement of the property management department will take the business of property management more seriously 2
. How many years has the Property Manager looking after your property been working in real estate? This means the Property Manager not the agency. Some individuals chose property management as a career - this is the type of person that should be looking after your property and they should preferably have had at least 3 or 4 years industry experience. 3.
How many properties does the manager looks after? A Property Manager who looks after too many properties may not have time to devote the attention to your property. Some busy agencies have up to 200 properties per Property Manager. In general this is far too many to give your property individual attention. At other agencies managing similar numbers of properties the staff ratio may be 1 to 100 properties. While these agencies may charge a little more for their property management services landlords find this extra expense translates to a trouble free investment that produces a higher long term return. 4.
How many years has the Property Manager been with the agency? You should look for stability in your Property Manager. You want to be able to pick up the phone and talk to that person today, and in 6 months time you want to be able to talk to that same person. 5.
Does the Property Manager hand out keys or do they attend property inspections with prospective tenants? If they just hand out keys and let the tenant inspect the property on their own, move on to another agency. It’s illegal in Queensland but beside that too many things can go wrong with this approach; your liability and the security of your property are compromised. 6.
How often will the manager inspect the property? At least every 16 weeks PLUS ingoing and outgoing inspections is about right. Property Managers who look after too many properties may not have sufficient available time to maintain this inspection regime. They either cut it back to every 6 months or sub-contract the inspections and writing up the reports. 7.
Do you have a system that checks rental arrears daily and takes the appropriate action immediately? A good property manager who uses electronic funds transfer methods for rent collections and up to date computer systems should be able to monitor rental arrears daily and minimise late rental payments by regular phone, letter, email and SMS communication with tenants. 8.
Do you have staff available to show my property to prospective tenants 6 days a week? The hectic pace of life, the advertising of rental properties on the Internet 24 hours a day and the “accompanied inspection” law means a Property Manager must be available to show prospective tenants your property when it best suits the tenant. 9.
Do you check prospective tenants for credit worthiness, past rental history and their current employment? Property Managers can ask for a copy of the tenancy ledger from a previous agent but not many do. Make sure that your Property Manager also subscribes to at least one major tenancy database and screens all prospective tenants carefully. 10.
Will you go to court for me if the need arises and what is your success rate for previous appearances? It is an unfortunate fact, that there may be a time when we are required to appear on your behalf to protect your rights as a Landlord If this happens you will need an experienced property manager to represent you as tenancy laws have become complex.