Your property investing experience doesn’t end when you purchase a property. It continues with the appointment of a property manageer, unless you decide to do it by yourself.
If you don’t have the time or expertise to personally maintain your rental, then engaging a property manager is likely to be your next step.
A property manager is responsible for the management of your investment properties. Some of the things he or she does are:
- Sources and screens your tenants
- Keeps and arranges records and other paperwork
- Collects and remits rent monies
- Takes care of tenant enquiries
- Arranges for maintenance and repairs
Some of the benefits of having a property manager are:
- He or she will take on most of the responsibilities of managing your tenants and property
- A manager can help you find quality tenants, and screen their references
- Their fees are generally tax-deductible
- You save yourself the stress and hassle of managing the property yourself
Keep in mind that this route entails costs, with property management fees across the county averaging 8%, according to Diane Bukowski, managing director of Eezirent Pty Ltd.
You may also be charged for the cost of negotiating lease renewals, and other administrative costs. All of these costs are generally tax deductible, as your property is an income-producing asset.
Choosing a property manager
If you have decided to hire a property manager to do most of the leg work for you, there are a few things you need to consider. You can’t just have anyone manage your properties—your money and investments are on the line here!
A few things you should take into account when choosing a property manager are:
- Referrals. Consider asking other investors for their recommendations. You could ask real estate agents or other landlords for referrals, and once you have them, check their track records and reviews. Then, create a shortlist of those you would like to get to know further.
- Experience. A property manager’s experience says a lot about the experience you will have them. Ask a potential manager about the properties they manage or have managed. Enquire about their management style; do they allow tenants to contact them via text and email, or only the phone? What is their process for tenant screening, and arranging maintenance? By asking these questions, you get an idea of how they will manage your property.
- Fees. During the screening of your potential manager, ask about their fees. How much a manager charges may vary, which could be based on their experience and level of service. Once you have gathered this information, compare the asking fee and service on offer with other property managers in the area.
- Communication. Even if you take a step back and let the manager do most of the property management, you still need to work closely with them. Observe how well they communicate or offer information during your meeting. Pay attention to how they relay details to you and answer your queries. Your manager should be able to relate to you and your tenants, as he or she will have to communicate with both of you.
Also read: Four Common Mistakes When Selecting A Property Manager
The DIY property management route
Perhaps, you’d like to be more hands-on with your property management, or you want to save money by doing it yourself?
Taking this route isn’t a walk in the park.
Here are a few questions you should ask yourself to see if you’re ready to manage your own property :
- Are you located near your rental property? Travelling for a couple of hours to and from your property to oversee repairs, screen tenants, and deliver documents could take a toll on your energy and may be costly.
- Are you willing to handle ongoing paperwork, enquiries and tenant screening? Part of managing your property is organising all legal documents needed. You also have to respond to enquiries and screen tenants to ensure you get the best possible fit. If you are already very busy, this may prove to be difficult.
- Can you keep up to date with the market? As a DIY landlord, you have to be up-to-date with what’s happening in your area. You also have to ensure that your rental increases are in line with the lease terms and the legislations in your state.
- Will you be available to address tenant concerns? Handling your own property isn’t a typical 9-5 job; there may be instances you would get a call in the middle of the night because of a leak, or there’s a dispute in your property. You have to consider whether you’re willing to be available to address your tenant’s concerns.
Also read: DIY Landlord: Your Guide to Managing Your Rental
Your rights and responsibilities
Whether you plan to hire a property manager or take the DIY route, it is paramount that you know your rights and responsibilities as a landlord.
You are required to guarantee the safety of your property and its content. Some of your responsibilities may also include:
- Keeping the structure and exterior of the house
- Making sure all installations are working like gas, heating, and electricity
- Addressing potentially health-threatening issues
- Other responsibilities as specified in the tenancy agreement
To get more details about your rights and responsibilities, visit the following resources:
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