Self-Management vs Property Managers: Costs, Workload, and Risks

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While self-management can save money, it often comes at the cost of time, effort, and potential legal headaches. On the other hand, property managers provide expertise and convenience, but not without fees and risks of their own.

Here's a breakdown of the key differences between the two options to help you decide which suits your situation.

Costs

Self-Management: Time and headache

The most obvious benefit of self-management is the potential to save money.

Professional property managers typically charge between 6% and 10% of weekly rent, so handling the property yourself means you get to pocket more earnings and can appear to boost your rental yield.

However, "free" management is rarely free. Even without ongoing management fees, you'll still need to pay for advertising, screening of tenants through tenancy databases, and keeping landlord insurance up to date.

Making costly mistakes is also a risk you'd need to consider. Mishandling bond lodgement, issuing an incorrect notice, or breaching tenancy laws can result in fines or tribunal action. You also must keep yourself updated with tenancy legislation and reforms, which can be difficult if you're handling multiple properties in different states or territories.

And of course, what you're saving by not hiring a property manager, you're paying for in time, which is often more valuable if you already work full-time.

Property Managers: Ongoing fees and more

The amount charged varies depending on the property managers and the property's location.

Hiring a property manager involves fees. Agencies typically charge 6-10% of the weekly or monthly rent in management charges. This can also vary by location, e.g, whether your property is in metro or regional areas.

They may also apply a letting (leasing) fee equal to one or two weeks' rent when a new tenant is signed. Advertising and marketing fees cover the cost of listing the property, signage, and professional photography. There may be charges for lease renewals, routine inspections, admin, and more.

Some managers may also charge other hidden fees for handling maintenance coordination, emergency call-outs, or compliance documentation.

While these fees can add up, property managers often save money indirectly by securing quality tenants faster, reducing vacancy periods, and ensuring rent is collected consistently. Their knowledge of market rent could also help investors avoid undercharging - though outcomes depend heavily on the quality of the manager you hire (more on that below).

Workload

Self-Management: Ready to manage the load?

Managing a property yourself is a hands-on role. You'll need to:

• Create listings and hold open homes
• Screen potential tenants and check references
• Draft lease agreements and lodge bonds correctly
• Collect rent, chase arrears, and handle disputes
• Organise repairs and maintenance
• Keep up with tenancy laws across your state or territory

For a single property located nearby, this may be manageable. But for investors with multiple properties, the workload can quickly snowball.

Property Managers: At your service

Property managers essentially offer a "set-and-forget" option. They handle tenant communications, schedule routine inspections, arrange trades for repairs, and ensure rent flows into your account.

They also provide 24/7 availability for urgent repairs or emergencies, something most investors can't realistically manage themselves.

That said, you can't completely walk away. Investors still need to review statements, approve major expenses, and check that the manager is performing to expectations.

Risks

Self-Management: Laws and emotions

The biggest risk of self-management is legal. Australia's tenancy laws differ across states and territories, and they're regularly updated. Even a minor error, such as issuing the wrong eviction notice, can lead to disputes before a tribunal.

Another pitfall is emotional involvement. When you deal directly with tenants, it can be difficult to stay objective in disputes about rent arrears, damage, or repairs. This can lead to stress, poor decision-making, or strained relationships with tenants.

Property Managers: Bad management

While property managers reduce legal and emotional risks, they're not perfect.

Quality varies widely across agencies. A poor manager may ignore maintenance requests, fail to follow up arrears, or communicate poorly with both landlord and tenant. This can be just as damaging to your investment as self-management mistakes.

There's also the cost factor. Fees can eat into returns, particularly in lower-yield areas. Some investors also dislike giving up control, preferring to know exactly what's happening with their property.

What should you choose?

Whether you should self-manage or hire a property manager largely depends on your circumstances, knowledge, and priorities.

If you're looking to maximise cash flow and are confident in your ability to handle the workload, self-management may work in your favour. But if you prefer a hands-off investment with fewer legal and emotional headaches, a professional property manager is often worth the fee.

Here's a checklist to help you decide:

Self-management works best for investors who:

✅ Have properties close to where they live

✅ Are confident with paperwork and tenancy laws

✅ Have time to handle tenant communications and maintenance

Property managers are often a better fit for investors who:

✅ Have full-time jobs and limited spare time

✅ Own interstate or multiple properties

✅ Value peace of mind over marginally higher returns.

In the end, property investment isn't just about numbers; it's about balancing returns with peace of mind. Choosing the right management style is one of the most important steps in achieving that balance.

If you're looking to buy your first or your next rental property, loans.com.au offers investment home loans with competitive rates, flexible features, and repayment options to suit your goals. Visit our website to check if you qualify or chat with one of our lending specialists to help you find the right product for your investment needs.

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