While many investors spend a large amount of time and effort carefully researching the property markets and then finding the top investment, they ignore the role that a property manager can play in preserving their property’s capital value and maximising its income.
Many think they don’t need a property manager at all and can do it themselves. This is possibly because they don’t understand that property management is much more than just collecting rents.
To manage your property to minimise vacancies and maximise your returns requires:
* Industry specific skills and knowledge such as knowing how to market your property effectively to get it exposed to the maximum number of tenants.
* Setting the rent at an appropriate market level to ensure quick leasing, the choice of a variety of good tenants and at the same time maximise the returns in these days of rising rents.
* Checking potential tenant’s references to ensure you have a reliable tenant who is unlikely to cause troubles.
* Drawing a fair and comprehensive lease to protect your interests as a landlord.
* Lodging the bond with the relevant authority.
* Handling repairs and maintenance with skilled, licensed tradespeople.
* Paying insurances and outgoings on behalf of the landlords who will work at fair prices.
* Keeping up to date with complex ever changing tenancy legislation.
Because the relationship with your property manager will be an ongoing one,you should consider all the services and skills your manager should have before making a choice.
With new technology many property managers have centralised their services, so it’s not essential to appoint a managing agent whose office is in the same suburb as your investment property. It is important however to find someone who has the experience in the property market that your particular property is located in.
It is best to arrange to meet at the property managers office as this gives you a great opportunity to observe them on their home turf. It will help you decide if you feel comfortable working with them and should allow you to gauge their level of professionalism.
Here are 11 questions that you should ask your prospective property manager:
1. Does the agency have a dedicated property management department and how many staff will be looking after my property?
Many agencies see property management as a “poor sister” to the more glamorous sales department and some even leave the management of client’s assets to the front desk staff and receptionists. Adelaide Residential Rentals does nothng but property management. All are staff are qualified and experieinced and we have a low of properties to staff ensuring your property gets all the attention it needs.
2. Is a director/owner of the agency involved in the day to day management of the property management department?
Most agencies have a sales department and a rental department. Generally the business owner has a sales background and not a rental background, and looks after the sales department leaving the management of their rental department to a property manager. This is often because the sales department has a higher turnover and high income. The rental department has a lower income, is more intensive and difficult to manage. Peter Wundersitz is the director and owner of Adelaide Residential Rentals and will always be your first point of contact whether meeting at our offices in North Adelaide or at your property.
3. How many years has the property manager looking after your property been working in real estate?
This relates to the property manager and not the agency. Going to a brand name agency doesn’t mean their service is going to be any better.
Many people start their career in real estate as receptionists and then move up to the property management department, and some of the top performers move into sales. Yet some individuals choose property management as a career and this is the type of person that should be looking after your property.
We have 25 years experience in property management , low staff turnover and we even have some of Adelaide's better managers wanting to work with us!
4. How many years has the property manager been with the agency?
You should look for stability in your property manager. You want someone who will learn your property inside and out. You want 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.
All our staff are specialists in their job whether it is your dedicated property manager , our leasing department or our accounts dept.
Our longest serving staff have been with us over 10 years and as they are not trying to be everything to everyone , they do not get stressed and can spend the time neccesary to answer any quieries you might have and manage your property properly.
5. Does the property manager give you a written proposal?
Some property managers just go out and look at your property and say “OK, we’ll put it on our books”. Look for someone who has put in the time and effort to present a professional image to you and gives you a written proposal. If they make the effort to present their services professionally to you, it is likely they will look after your property professionally also.
6. What geographic area does the property management service cover?
While you should be looking for a property manager with expert local knowledge, consider what your property portfolio will look like in a couple of year’s time. Will you own a number of properties spread throughout the suburbs?
You could either employ a specialist property manager in each geographic location or you could instruct a large property management company that covers a larger geographic area.
Australia is now following the overseas trend in the formation of agencies that are solely dedicated to property management and cover a larger geographic area. With the advent of internet advertising and electronic banking, these offices no longer need to be located in the local shopping strip to manage your properties. Many professional property investors are turning to this type of asset manager who will be able to look after their entire property portfolio.
7. Does the Property Manager hand out keys or do they attend property inspections with prospective tenants?
If they just hand out the keys and let the tenant inspect the property on their own, move on to another manager. Too many things can go wrong with this approach and the security of your property is compromised. Inspecting your property with a prospective tenant means that the agent has a better opportunity to promote the property, as well a chance to get to know the tenant a little better.
8. How many properties does the manager look 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 200 properties per property manager. In general, this is far too many to give your property individual attention. At some boutique agencies each property manager looks after about 100-150 properties.
At Adelaide Residential Rentals , with our dedicated staff i each dept , the raio is approx 1:100.
9. Do you have staff available to show my property to prospective tenants six days a week?
The hectic pace of life and the advertising of rental properties on the Internet 24 hours a day means a good property manager must be available to show prospective tenants your property when it best suits the tenant.
With our specialist leasing dept , leasing properties is all they do , day in ,day out.
If a prospective tenant calls us today , they will inpsect the property they have enquired about within 36 hours . They will not have to wait until the next open time beacuse the manager is too busy with routine inspections and maintenance.
Our days vacant is consistently 10-11 days less than the industry average meaning more income for you.
10. Do you have a system for checking prospective tenants with regard to credit worthiness, past rental history and their current employment?
Ensure that your property manager subscribes to a major tenancy database and screens all prospective tenants carefully.
We are members of the TICA data base and all our applicants are screened for previous landlord references , employement references and rental history .
Once we have found a tenant we like , we then contact you and let you make the final choice .We will never reccomend a tenant who we think does not meet our strict criteria.
11. Will you go to court for me if need be and what is your success rate for previous appearances?
Unfortunately, you just might have to go to the tenancy tribunal 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 quite complex.
If we need to take a tenant to th tribunal we do this at NO CHARGE to you. We keep extensive documentation of your property as well as a database of photos from all inspections and have a very good success rate at hearings.
As a property investor you have the choice of managing your investment properties yourself or delegating the day-to-day management to professional property managers. Engaging a property manager is the preferred option for investors in today’s more complex property market.
However, it is critical that you choose your property manager wisely as proactive property management can considerably increase the return from your investment property.