You’ve just purchased or about to purchase your first investment property and you are tossing up whether to manage it yourself or engage the services of a property manager. Managing a rental property can be a complex and frustratingly protracted process, which is why many investors turn to a property manager for professional judgement and support.
Selecting a manager is a critical element in lessening the risk and maximising your returns. A property manager can source tenants of high quality whilst reducing the pressures associated with therental property. When you begin your search for a manager, you’ll want to ask the following 8 questions to ensure you find the best professional for your particular needs and circumstances.
Does the agency have a dedicated investment property management department?
Some agencies will have a team of managers with many years experience, others leave property management tasks in the hands of the front desk staff. You may find that an agency where the director has an active involvement in the property management department will take the business of property management more seriously.
How many years property management experience does the property manager have?
A property manager who has many years of experience will be more conversant with the local market and will have dealt with difficult tenants on more than one occasion. They will be able to source high quality tenants and will know how to best market your rental, thereby reducing periods of vacancy.
An experienced manager will have the systems in place to be able to provide a written analysis of comparable rental properties currently on the market, giving you confidence as to what realistic rental returns your property will achieve.
How many investment properties are you currently managing?
Large agencies can have up to 200 properties assigned to each manager, an indication that the agency has a good reputation, but this can mean that the property manager has less time available to manage your property.
Does the agency have a defined marketing?
Does the property manager have a structured plan that utilises a mix of online and offline marketing strategies to promote your investment property? What means will they use to reduce periods of vacancy and find tenants of high quality?
Do you have a process for vetting prospective tenants with regard to credit history, rental history and current employment?
Ensure that your property manager subscribes to a major tenancy database and vets all prospective tenants carefully, ask for a copy of the tenant application form to see what information the agency collects.
Does the property manager give you a written proposal?
If your prospective property manager just has a quick look at your property and says “looks fine, I’ll stick it on our rental list”, look elsewhere. A manager who can’t put in the time and effort to present an image of professionalism to you, won’t look after your rental property with professionalism.
Do you conduct exhaustive and regular inspections?
You’ve worked hard to be able to purchase an investment property and probably borrowed a fair sum as well, your property manager at a minimum should conduct two inspections a year. This helps identify any damages or repairs early, thereby protecting your valuable asset. You should also find out how you will be contacted if repairs are needed and how your approval will be obtained before any repairs are carried out.
Will you go to court to represent me if necessary?
Unfortunately, you just might have to go to the tenancy tribunal to protect your rights as a landlord. Should this occur, having an experienced investment property manager to represent you is a must, as tenancy laws are quite complex.
When investing in property you can choose to manage your investment portfolio yourself or hand over the management to a property manager. In a complex property market, retaining an property manager is the favoured method for today’s property investors.
However, it is crucial that you select your property manager carefully, as dedicated property management can appreciably increase the return from your investment property.