Purchasing your first investment property can sometimes feel like you’ve just taken a step into a dream-like dimension; a place where you can literally make money whilst you sleep.
But in reality, it can also very much be a hustle within itself. And teaming with a property manager that doesn’t put in the good yards can very quickly have an investor working over-time, those valuable, yet fleeting opportunities of securing a tenant, or keeping one, more susceptible to falling by the wayside.
“Without a doubt being a property manager is a tough gig. However, as an investor, it is imperative you have a great property manager looking after your valuable assets,” says Grant Foley, director and buyers agent of Grant Foley Property and member of the Property Investment Professionals of Australia (PIPA).
“To truly asses the quality of a property manager, I would recommend at least a formal face to face interview, as well as speaking to some referees provided by the property manager.”
An 18-time property owner himself, and with an investment portfolio that tips over the $9m mark, Foley is no novice when it comes to understanding the backup that’s needed when an investor has their attention spread-out thin over multiple assets.
An experienced, all-rounded property manager should ultimately be able to keep the property looking sharp, and the profits fluid.
“Putting that extra effort and rigor into the process of finding a great property manager at the very start could save you a whole heap of pain and costs down the track. That’s if you get it wrong,” Foley says.
“Property management is all about people. Inexperience, lack of continuity, and poor organisation, communication and problem-solving skills are the most common frustrations investors have of property managers.”
But how early on can you detect whether a goal-kicking, profit-getting, tenant savvy individual has just fallen under your radar?
In fact, it’s up to you as the investor to make that call – and that starts with knowing the right questions to ask; immediately following that initial handshake and well-before signing them on.
“Outside of basics such as the agency service level agreements and associated rates and fees, you want to get a feel for the quality of the people in the agency,” Foley points out.
To help direct you onto the right track,Foley recommends investors start by asking a potential property manager 8 questions:
- How many years of experience do you have as a property manager?
- How many years have you worked in this suburb / at this agency?
- How many properties do you manage?
- How many properties do you currently have vacant?
- Will you be my primary contact?
- Share with me a complex problem you have recently solved?
- Tell me about how your team / office works. What processes and systems do you employ to ensure everything runs smoothly?
- Can you please share 3 landlords as referees that would be willing to speak on your behalf?
But whilst an interview may help you detect any red flags in advance, actions always speak louder than words. And so, such an adage continues to reign as the primary indicator of a property manager’s ability to secure tenants, maintain rental income and overcome obstacles.
In saying this, here are 3 things your property manager should be doing:
- Be willing to take marketing to the next level
“For the last 15 years the real estate mix of strategies have gone through a massive transformation that has seen the move from print advertising to online directories, and now towards social media,” says Miguel Donnenfeld, co-director and production manager of JustClickVideos, the first video automation platform of its kind to hit the property market.
“Those that were first to embrace online profited from the early adoption, and I believe so will those agents that take new social media opportunities seriously,” he says.
“Videos are, in my view, the next step in the evolution of visual content to attract tenants and buyers.”
Long gone are the days when property managers limited listings to just a few punchy sentences. Videos could very well be the next surge in effective, visually led marketing, with the JustClickVideos platform expected to appear alongside every property listing nationwide by the year 2021.
Highlighting social media as today’s game-changer when it comes to attracting the right buyers and tenants, Donnenfeld looks to videos as the most powerful and effective communication tool in the current digital landscape.
“I can foresee a future where those that don't feature videos in their properties will miss out on a segment of the market that will be using videos exclusively to perform their initial filter and selection of feasible properties to rent or buy,” he says.
“It’s how the new generation think and how they look for information. It’s a matter of time that the ones who don't embrace video will be left aside.”
- Be proactive with tapping into a range of tools and strategies
According to Donnenfeld, a results-driven property manager will use every medium at their disposal to attract the largest and most suitable number of prospective tenants as quickly as possible.
“Today, we take for granted that the agent or property manager will know their suburb as if it’s on the palm of their hands. Add to that mix an agent that uses the right tools – then you have a great one,” he says.
Donnenfeld encourages investors to question their property manager’s approach: “Are they embracing new technologies and making the most with what this new, exciting, and ever-evolving digital market has to offer to attract the best buyer or tenant for your property?” he asks.
“Or are they leaving that up to fate?”
A property manager who is willing to utilise a number of strategies won’t only help to maximise an investor’s rental income, but they will also help to ensure that tenants reside in the investment property for as long as possible.
Being able to scout unique, niche avenues can also potentially elevate the property from similar ones that are inundating the market at a given time.
“Make sure that your agent is keeping up with technology and trends, especially when it comes to digital,” Donnenfeld advises.
- Be able to think on their feet and stay connected, no matter the circumstances
The unexpected can always arise, and so it’s important to team with a property manager who is able to overcome a problem, or adapt to a sudden change in circumstance; whether that be a tenant making a complaint, a tenant having to vacate a property on their own terms, or the demand for rentals taking a dive.
“A great property manager will obviously have many years on the job experience, industry and local market knowledge. They will have high levels of emotional intelligence, and be an assertive and authentic communicator,” says Foley, director of Grant Foley Property.
“They will also need to be highly organised, a crack negotiator, and a complex problem solver.”
It’s as much to do with a property manager’s wins as it is to do with their attitude throughout the entire process – because even the aims that look to be the most on-target can get swerved by the wind.
Having a property manager stay in touch with you, and consistently maintain a property to a high standard is no-doubt a tick in the right box. But the investment property could be built on quicksand if they then choose to fade into the background or diminish contact with you in more challenging times.
Foley says nothing beats a personal word-of-mouth recommendation.
“Prior to interviewing every property management agency in a chosen suburb, networking with other property investors can be a good place to start, helping to uncover feedback on who is, and who isn’t, the best agency or property manager in town,” he advises.
“Groups such as the Property Investors Council of Australia (PICA) hold regular member meet ups, where investors get together to share experiences, learnings, and ideas on ‘all things’ property investment.”