Selecting the right Property Manager to lease and manage your investment property isn’t a decision that should be based on the promise of a high rental price and a low management fee. You want an agency that is focused on increasing the properties exposure to active tenants, seamless management of the property and one that is going to give you astute advice and insights on rental market, income yields and marketing. The decision is an important one. It will make a significant impact on the final rental return for your property.
So here’s some of the things that you want to be on the lookout for and/or ask when you interview your next Property Manager:
Market Knowledge & Likely Rental Price
The best property managers know their local market very well and are able to quickly advise on how the tenant marketplace will track the property when it comes to price (and the expectations that tenants have of features that the properties do/don’t have at price points), what other properties have achieved for rent recently and other vacancies in the area. You want the Property Manager to base the likely rental price on solid facts!
Proactive vs Reactive Property Management
Great property managers should also be proactive in reminding you when fixed term leases are coming to an end. As an example, in NSW, 60 days notice is required when you are wanting to increase rent. Therefore, a property manager 90 days before the end of lease should start a dialogue/negotiate between the tenant, property manager and yourself (can sometimes be a back and forth conversation so allow for a max 30 days) still giving enough time for the 60 days notice of increase to be given in time to become effective shortly after the fixed term expires.
The Property Manager that comes in to your lounge room and pitches a fee that is 1-2 % lower than others is usually only doing this because that’s the only way they feel they can be competitive. But remember, you do get what you pay for. Whatever the case, you want the Property Manager to demonstrate value. Choose based on the value proposition and the experience that will be provided to both you and your tenant. You may sometimes have to pay a little more in fees but you’ll get this back 10 fold when your property is leased to better quality tenants, repairs are being attended to quickly, lease reviews undertaken regularly because your property manager wants to provide a fantastic experience as opposed to mediocre with it just another property on the books, adding to the numbers to make the boss happy.
Arguably one of the most important qualities in a great property manager is the ability to effectively communicate. There’s going to be quite a number of times in which the property manager is likely to speak to your tenants, and to yourself, and keep everyone connected with transparent and accurate information. You’re looking for a good negotiator, who understands the outcomes that need to be achieved, on your side, but can be both polite and firm. Remember that you want them to be able to solve problem, so they need to be good handling conflict, however when it is unavoidable they need to be able to present a factual case, clearly and appropriately should it lead to Tribunal. This is also largely about personality – are they likeable? Are they reliable? Do they do what they say they are going to do? Do they deliver what they promise? Reliability is absolutely crucial for both your ease and the happiness of your tenant. Remember that your tenant is important, and your property manager should work for you, while caring about the safety and comfort of your tenant.
Vasili Hadzellis is a coach, trainer and consult to Property Managers and Property Management business across the country. He is committed to changing property management for good.
Core Property Management Consulting Australia