I hate to say it though, but I see far too many investors not putting enough thought or even effort into who is the best person to professionally manage their rental properties (And don’t get me started on those who try to save $100 per month on self managing).
Those who win the most from their hard earned investments understand that like most things involving money, that property investing should be treated like a business. Emotion need to be removed from the equation and the best professional real estate agent, local to their investment property, should be chosen to look after their property.
It should come as no surpise, but not all property managers offer the same service and not every property manager has the same qualifications, policies and procedures to ensure that you are well looked after. So, what signs do you need to look for to ensure you’re picking the best??
The following six indicators show what to look for (and what to steer clear of).
1. Job Satisfaction
If your property manager does not enjoy their work or receive any form of satisfaction from what they do, their care factor for your investment will be minimal. It’s a stressful and difficult position to fill that never gets enough credit. So if your property manager can not handle the rough and tumble that comes with the industry, chances are they won’t be there long term. High staff turn over is one of the biggest problems in the industry that mean lost information, lack of communication and problems for your investment. So find someone that genuinely enjoys what they do!
At the very minimum, you should hear from your property manager every week when your property is vacant, before you don’t receive the rent if there’s a payment issue, you also should be contacted for your routine inspections (invited to them) at 3 months into a lease and every 6 months after that (in Vic), receive the routine inspection reports and rent reviews (3 months prior to a lease end or every 6 months if they’re not on a lease). Beyond that, you should be able to get a hold of your agent during business hours. If you call and call your agent and don’t get a return call in 24 hours, then somethings wrong there.
3. Strong reporting
Following on from regular rent reviews and routine inspections. These are the simplest items to diarise, report on and ensure that you receive within the time frames stipulated by the legislation. If you are not receiving detailed routine inspection reports and rent reviews at a minimum, then you’re not getting the service you’re paying for. When choosing an agent, ask for these- they should be able to provide you with an example to help your decision making process in choosing the right PM for you.
4. Poor or no maintenance
In a perfect world, nothing would ever break and things would last 50 years or more. But, that is not the case. If you have tenants living in your property, there is always something to fix or be looked at. Preventative maintenance saves you money in the long run.A good example is noticing a wet patch in a ceiling or wall near the bathroom, or cracks in the grout of a shower – having this noted and investigated (a clear sign of a leak) is much cheaper than waiting until the problem becomes an obvious mold issue which can require full internal wall replacement. Getting maintenance done in a timely manner also keeps happy tenants – regardless of the hard conversations that property managers have with owners (no one likes to part with money unnecessarily) they need to be telling you about maintenance and in some cases, convincing you for your own good to get it done!
5. Legislation and compliance knowledge
The legislation in relation to residential tenancies is quite complex and with the rise of the tenants union and knowledge being readily available to everyone with a smart phone, landlords are finding themselves in hot water more often as they inadvertently breach the act and are taken to VCAT for this. A good example from one of my very own landlords this week was where he advised that he would only complete the maintenance if the tenant signed a new 12 month lease! (for those of you in the know, you can’t do that. The tenant has every right to take this landlord to VCAT in order to get the maintenance done via VCAT order as well as seek compensation for the time the maintenance was not done! If your agent cares about you and your property, they’ll tell you this even though you might not want to hear it!
6. Follow up
A good example of this is when your property is vacant. It can be a most stressful time especially if you depend on the rent to pay the mortgage. So you would expect your agent to follow up every potential lead and every good application until it’s leased, keeping you informed along the way. When you’re kept in the dark, either the property manager is too busy to get in touch with you (just take a moment to think about how that reflects on your vacancy / loss of income), or, it’s not part of their process which also indicates a bigger problem.
I know it’s a long post, but I think it’s an important one, and if you’ve made it to this far, then you’re likely to be a good caring landlord that I would love the opportunity to work with. If you have any questions on our processes and how we can help you with your investment, get in touch! Those who do not think these items are important when looking after their investment, often don’t realize the actual loss they suffer when things go wrong and how preventable that could have been.