Ask anyone who’s ever been a landlord, and they’ll tell you that the right property manager can make or break your investment!
Choosing the right property manager (PM), therefore, is a pretty important task – and there’s an easy way to cut through all the clutter to find a professional who will properly manage your rental property, says Jan Malmstrom, manager, property investment management, LJ Hooker International.
Interview them! Malstrom believes you should ask your potential new PM the following 10 questions before you even consider sharing a percentage of your rental income:
1. How can you demonstrate your knowledge of the local rental market?
“Your property manager should have sufficient experience in the industry and with the agency to give you confidence,” Malstrom says. “So ask how long they have been a property manager, and how long they have been at the agency.” Feel free to ask for referees from two or three clients with similar properties.
2. How familiar are you with current relevant legislation?
There are many policies and laws that govern owning and leasing an investment property, and they’re constantly changing, so it’s vital that property managers stay up-to-date.Look for evidence of professional development, ongoing training and membership of appropriate bodies.
3. What support do you have in your real estate office?
You want a PM that has a good team to support them in matters of administration, sales, leasing and finance. “Ask how the team is structured,” Malstrom says. “Who will be inspecting the property, and who will handle maintenance, for example? You need to know who will be responsible for what happens with your investment.”
4. How do you handle any issues that may arise?
“It’s very important that, from the start of the working relationship, you fully discuss all aspects of the management process,” Malstrom says. “For example, when will the property manager contact you if there is a maintenance request or if the tenant should have a problem paying their rent? Discuss these items fully, before a tenant is selected and management begins.”
5. How – and how often – do you communicate with your landlords?
Your property manager should be in regular communication through an agreed process, whether that’s monthly statements, property inspection reports, or email updates of general market information. “It’s also necessary for your property manager to keep you informed on anything that happens with your investment property, such as maintenance issues, rent reviews, lease renewals and when a tenant is vacating,” Malstrom adds.
6. What is your strategy for attracting the best tenant for my property?
“This is really an important one, because the last thing you want is for a property manager to just hand out your keys to prospective tenants,” Malstrom says. A good property manager will consider which demographic is attracted to your property and focus marketing accordingly, with an emphasis on internet advertising. “Your PM should also have a database of quality tenants currently looking for property.”
7. How are the financial aspects managed?
Your property manger should clearly explain how and when rents are collected, and when to expect your money in your bank account. “You should also fully comprehend what the management fee you pay entails,” Malstrom says. “These items should be included in any management agreement before you sign the document.”
8. How do I know I will have a reliable income stream and that my property is in the best position for capital growth?
“Choose a property manager who cares; it will increase your property’s return,” Malstrom advises. “For a landlord, up-to-date information about market-driven rental returns is as important as what the property might be worth in a sale situation. The real estate team should keep you constantly informed by drawing on its sales, property management and finance specialists’ expertise.”
9. How often will you inspect my property?
How often a property manager can inspect your property is dictated by legislation, but you should make sure your property manager plans to conduct routine inspections according to that legislation.
10. What can I stipulate in my agreement with you as property manager and in the tenancy agreement?
This is your opportunity to discuss any special requests you have of tenants both inside and outside the home, and your expectation when it comes to matters like cleanliness and maintenance.
Collections: Mortgage News