Up Close And Personal: 12 Things Investors Need to Know About Property Managers

By Sharon Fox-Slater on 26 Nov 2014
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Along with a quality landlord insurance policy, a good property manager is one of the most important protections a property investor can have for their hard-won asset. However, there are a number of hidden factors investors need to be aware of when it comes to property managers. Here are 12 things every investor needs to know about property managers…

  1. Even if you go to a great deal of effort to select an individual property manager, it is vital to assess their agency as a whole. Many agencies experience high staff turnover but, if they have good business systems, it will help ensure you get consistent service regardless of which manager looks after you.
     
  2. The person at the agency who signs you up may not be the one to manage your property. Check you can easily reach the staff with “hands on” responsibility for your hard-won asset. Ideally, you want a stable, experienced property management team and good agency processes.
     
  3. The agency which sold you the investment property is not necessarily the best to manage it later – actively review your choices in the local area, rather than just taking the most obvious option.
     
  4. The best property managers do more than collect the rent and organise repairs. For example, they can suggest high-return improvements and make sure you are aware of your options when it comes to insurance.
     
  5. Property agencies should be judged on quality not just price. The advantage of a slightly lower management fee will quickly be eroded if there’s an unnecessary vacancy or a badly-prepared tribunal appearance. In comparing agencies, don’t forget to ask how many properties each manager handles, and whether they hold open for inspections on weekends. Examine all their ancillary fees as these can really add up.
     
  6. It is important not to focus on price alone when selecting an agency, but it is also worth remembering that you can negotiate – the higher end the property, the more room there usually is to manoeuvre. Investors with a larger portfolio also have more power to strike a better deal.
     
  7. Consider doing some mystery shopping before choosing an agency. Inspect the quality of their “for lease” ads and photography, check how long it takes to return your call and consider turning up to an open for inspection.
     
  8. Property managers are on “your side”, but they also have a professional duty of care towards tenants and a responsibility to ensure relevant legal rules are followed. Property managers need to be able to negotiate in a firm but personable manner with tenants and landlords – so when they say you can’t make DIY electrical repairs, for example, don’t take it the wrong way!
     
  9. Property management is not an easy job. Think twice before taking on the role yourself – poor quality tenants often target DIY landlords because they know a professional will screen them out. Even with professional managers, there are no guarantees but, if worst comes to worst, they are better equipped to deal with the eviction process.
     
  10. Property managers usually have access to a network of quality, responsive tradesmen. These may not always be the cheapest in town, but have proven their ability to get the job done reliably. If the quote provided really is over the top, take the time to do some research on alternatives – and be polite in raising the matter. Set aside some of the rent you receive so that you can afford repairs.
     
  11. Read your annual rental statements with an eye for what’s missing as well as what’s there – has money been taken out for pool maintenance, gutter clearing and the like? If not, ask why.
     
  12. Property managers can make your investment journey easier and smoother, but the buck stops with you – it’s up to you to carefully select your property manager, respond to their queries, monitor their performance and proactively change managers if necessary.
About the Author

Sharon Fox-Slater is the Executive General Manager of RentCover, a division of EBM Insurance Brokers which insures 120,000 investment properties around Australia. With 20 years’ experience in landlord insurance, Sharon’s top priority is customer service and positive customer comments are her biggest marker of success. Despite leaving school at 15, Sharon has forged a ground-breaking career – she was the first woman to become a Fellow of the National Insurance Brokers Association. Sharon was recently honoured to have been included in Insurance Business magazine’s Elite Brokers 2013 list.

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