Below are thoughts and questions you may want to keep in mind! To understand what your home will rent for - Click Here For A Free Rental Quote. First time leasing out your home? You may also want to Click Here For Owner's Frequently Asked Questions
Member, National Association of Realtors (NAR) and National Association of Residential Property Managers (NARPM)
With rising rentals and falling vacancy rates, many beginning landlords (owners) fail to ignore the relationship with their property manager as an ongoing business partnership. Too many landlords choose their property manager on fees alone.
Others 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 home to minimize vacancies and maximize 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 maximize 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.
Here are 11 questions that you should ask your prospective Property Manager:
1. Does the agency have a dedicated, licensed property management personnel 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. Ensure that your agent has a dedicated property management department. It would be preferable that this department is staffed by a number of experts so there is continuity of management in the event of one property manager being ill or leaving.
2. Is the Director/Owner/Managing Broker of the company you want to hire involved in the day to day management & supervision of the property management operations?
Some real estate offices have both 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. You may find that an agency where the director has an active involvement of the property management department will take the business of property management more seriously.
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.
Some 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.
4. How many years has the property manager been with the agency or office?
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. Due to the stresses involved in property management, the staff turnover tends to be quite high.
5. Does the property manager provide you with samples of their leasing documents?
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 areas 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.
7. Does the Property Manager hand out keys or do they attend property showings with prospective tenants?
If they just hand out the keys and let the tenant inspect the property on their own, move on to another agency. Too many things can go wrong with this approach and the security of your property is compromised. Showing your property with a prospective tenant means that the agent/property manager 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 may be far too many to give your property individual attention. At some boutique agencies each property manager looks after about 50 -150 properties. While these agencies may charge a little more for their property management services, landlords find this extra expense translates to a trouble free investment that often produces a higher return.
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.
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.
11. Will you go to court for me if need be?
When you have chosen your property manager, establish a collaborative relationship and agree on your working parameters. While many property managers do go to court - property managers are not Attorneys.
Explain to them how involved you want to be in the ongoing management of your property. Make it clear what they are allowed to do without referring back to you and when you do require them to contact you. This will avoid many of the misunderstandings that arise between property managers and landlords.
For example, if you signed an agreement for your property manager to spend up to $500 on repairs without obtaining permission, don’t expect them to phone you each time a tap washer needs replacing.
Listen to your property manager if they suggest you undertake non-urgent repairs or maintenance on your investment. This will keep your property in top condition and you will be less likely to lose your tenants.