Property management is one of the last things on the list that you need to think about when you’re buying an investment property. You’ve gone through the contracts, sorted out the stamp duty and the house is yours – but now you need to get it rented or managed! While it might be one of the last things you need to check off your list, it’s certainly not one of the less important things. The company who will manage your properties is going to be responsible for making sure that your rent is paid on time, that your property is maintained and that your tenants are doing all the right things by you.
In order to feel secure as a property investor you need to have someone managing your properties who you can trust manage your properties for you and who can ensure that any grievances are dealt with promptly, correctly and in accordance with the law. You need to ensure that your property manager has your best interests at heart, and that you are able to communicate with them regularly and openly.
Let’s take a look at how you can find the right property manager for you.
- Look at them objectively
What is the communication like between you and your prospective property manager? How good were they with getting in touch when they said they would, or with emailing you? Your property manager needs to be able to speak to your tenants in a timely manner and to be able to communicate details to everyone involved in a rental situation, while at the same time keeping people on side and keeping the peace. A good property manager is going to be someone who is professional, a good negotiator and who is polite and firm. You need a professional person who can keep a cool head and who can communicate the facts about an issue without blowing things out of proportion. High drama has no place in a rental tenancy situation. Even though sometimes tenants may be upset about possible things that can go wrong in a house, it will only compound the problem if your property manager isn’t calm.
Is the property manager a likeable person? They don’t need to be your best friend, but they certainly need to be reliable and affable. The relationship they are going to have with your tenant needs to be a relatively friendly one, so that your tenant feels that their property manager is approachable. Your tenant is one of the most important parts of the rental process, so it’s vital that the person you choose to manage your property is going to enjoy the relationship that they have with their property manager.
- What is their fee structure like?
Sometimes it varies slightly, but your fees are generally going to be 7 per cent plus GST for the property management – and this covers things like collecting rent, and then you’ll also pay one to two weeks’ rent for leasing the property. While the fee isn’t the most important part of your property management choice – it’s certainly something to consider. Just remember though, that as with most things, you get what you pay for.
- What is their experience like?
Years of experience doesn’t necessarily mean that a person is a good property manager, and conversely, a small amount of experience doesn’t equal a bad property manager. The right balance of personality and experience will usually equal a good property manager. When it comes down to it, a good property manager is going to be pragmatic about how they resolve issues, and they’ll use tried and tested systems and processes for resolving conflicts. Also, it pays to find out whether you’re going to have a principal director or manager managing your property, or if you’re going to have a junior delegated to manage your property. Just ask your property management company and be clear about your expectations.
- What are their systems like?
If the agency you’re considering doesn’t have a dedicated property rental management department in place, then you need to ask some questions about how they intend to cater to your property investment portfolio. You need to know when inspections are going to be performed and ask them to take you through the process. Also get them to take you through their process for record keeping, and get them to tell you how they intend to keep you in the loop.
Find out what kind of process they have for expenses and repairs. It depends on the kind of portfolio you have and how many properties you have with them – some investors prefer to be told about every single dollar that is going to spent, but sometimes with some investors you might choose to have an automatic authorisation for any spend under a certain amount – say for example $200. A good property manager will probably have already thought of this – and will probably be able to take you through some of these things, and will probably think of things you haven’t even thought of!
Here are a couple more tips:
- You can choose a well-established agency or a boutique one, but just make sure that you like the feel of the agency and what they offer. You might enjoy the flexibility offered through a boutique agency, or you might prefer the professionalism of a larger agency if you have a lot of properties to look after.
- Use your buying power as negotiating power: if you’re buying a new property or selling one you can use this as pulling power to reduce a fee with your agency if you enlist them for the sale.
- Make sure your agent is incredibly thorough with their checks. You need to make sure that their process is to only call landlines for reference checks, and to be through with investigating the professional and rental history of your tenants.
If you’re wondering about property management for your investments, then get in touch with AllianceCorp today. We have a full service property management department who can help you to get your properties rented sooner rather than later. We also pride ourselves on our excellent working relationships and have a large range of experience and skills with getting the best situation for both tenants and investors.