Written by Maria Pace
Why is finding a good Property Manager hard work? The Net Promoter Score (NPS) for Real Estate Agents is negative 39 and negative 9 for Property Managers.
A recent 2019 Realestate.com Landlord Insights Survey found many Owners chose to self-mange due to mistrust. When broken down further this lack of trust resulted from lack of care when dealing with maintenance, inability to find tenants, lack of time to manage property and that they are found to be too busy with other properties.
So how do you find the right one?
A great property manager will maximise the return on investment on your property and minimise the stress of looking after the needs of your tenants.
They will also know the pricing trends in your area, should have a list of potential tenants seeking property similar to yours and have relationships with trusted tradespeople and service providers who’ll keep your investment in tip-top shape.
While you have the ultimate say on who should rent your property, a good property manager will offer their experience and processes for selecting the best applicants.
For the tax-deductible service fee, a property manager’s experience in dealing with tenants and handling the day-to-day management of property can be invaluable.
Here are nine guidelines for choosing the right property manager for you.
1. Go Local Local knowledge is hard to beat when it comes to choosing the right property manager to handle your rental property. A local Property Manager will have access to a large database to lease your property effectively and efficiently with maximum return.
A property manager will know the local market conditions and ensure that you charge the highest rent the market will tolerate. It’s in their interest to do so because their commission level is determined by the rental income. 2. Research alternative Property Management Companies Word of mouth is the best recommendation so ask friends and family first. The next step is to look at reviews, a quick Google search will give you the ability to create a short list of potential Property Managers and quickly rule out a few.
3. Don’t be just a number It’s reasonable to draw up a shortlist of three property managers. When interviewing each one, ask for the number of properties under management and the number of staff assigned to them and length of time they have been with the agency.
Property Management turnover is an issue in the industry, so look for Agencies that have a good longevity of staff.
4. Ask lots of questions Ask questions that will reveal their knowledge of the local market, how they set their recommended rents, their approach to marketing your property, the process for selecting a tenant and how they retain great tenants.
What do their Owners and Tenants say about them? Many companies will have their positive reviews on their website, but how happy are their clients? A good proactive Property Management Agency will know how they rate with their clients in key areas such as communication, professionalism, knowledge and their net promoter score.
A key component is to see if they offer a service level agreement as part of their agreement with you or a no-lock in contract, as it shows they are willing to walk the talk.
5. Get into the nitty-gritty You should also understand how a property manager deals with problems, such late or non-payment of rent, and how they approach disputes. Find out how repairs and maintenance are handled, and whether services such as gardening are provided at an additional cost. You should be clear on the number of inspections to be undertaken each year, and how regularly you expect your property manager will communicate with you.
6. Go for experience Ask your Property Manager how many properties they have available for lease and what is their rental application acceptance rate.
You should be confident that your property manager will select a great quality tenant. This is perhaps the key skill they bring. They should be able to identify applicants who might be untrustworthy, have a poor record of paying rent on time or have a judgment against them for damaging property. Equally, they should have great systems for identifying and retaining good tenants.
7. Good communication is key A property manager should satisfy you that they will respond quickly to issues. A Property Manager is generally in and out of the office regularly, so how is communication handled for urgent and non-urgent issues or on weekends? Failure to maintain a house or apartment can lead to bigger bills down the track. Failure to communicate effectively not only with yourself, but the tenant can lead to a breakdown in what should be a good relationship.
Information at any time is key, many of the questions we want to know, such as where the tenants rent is paid to, if maintenance is completed/progressing, getting a copy of the summary financial tax year, a copy of the lease, or paid invoice should be available to you from your phone 24/7.
8. If you’re still unsure . . . Seek references from other landlords if you are unable to choose from your shortlist of preferred property managers. Also, ask property managers for their retention rates of landlords and tenants or survey results or raw data. You may see a pattern emerge.
9. Don’t nickel and dime Resist the temptation to go with the property manager who offers the lowest fee. You definitely pay for what you get in the property management game. If a quality, attentive manager comes at a higher price, it may well be worth the investment. Expect to pay in the vicinity of 11-15% of the rental income. Also note that it is tax-deductible.
Finally, don’t rush the process—take your time and choose well…you’re leaving a hundred thousand dollar investment in their hands.
About the Author Maria Pace is a Senior Property Manager at Empire Estate Agents with a passion for property that has lasted more than 12 years. Maria has a vast array of skills in relation to property from Trust Accounting, Property Management, Sales and Leasing. Maria has a high attention to detail, matched with professionalism, knowledge and a wonderful way with people, that makes her ideal to look after property and connect with people. The team at Empire have been lucky to have celebrated more than 10 years of working with Maria. Want to know more about Maria? Read our Empire State of Mind – 10 years in Property Management. Need more information or can we help you with any other of your Property Management questions? Empire Estate Agents is a local boutique Real Estate Agency situated at 966 Albany Highway East Victoria Park. Please let us know if we can assist you with any of your property management or strata management needs as we would love to help! Connect with us today.
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