Choosing Your Property Manager - The Important Questions!
Choosing the right person to manage your investment property is a crucial decision, almost equal to the importance of choosing the property itself. This could turn out to be a critical factor in the overall performance of your investment portfolio and very careful thought must be given to who you entrust this process to. With the rapidly changing industry and advancements in technology, gone are the days of picking the biggest agency in the area. Forefront of your mind when making your selection should be customer experience, trustworthiness, experience and reputation.
Disregarding fee structures, which are talked about in a previous blog, there are some key considerations and questions you should consider when interviewing your next Property Manager:
What are your qualifications and experience?
This will give you an insight into both the commitment and ability of the professional handling your investment. This doesn’t necessarily mean that somebody who has been in the industry for a very long period will be better, but is important that the person managing your investment or portfolio has the skill set and familiarity in dealing with tenancy issues as they arise to ensure best practice and mitigate your risk.
How many properties do you manage?
As with above, this shouldn’t be a single factor in your decision-making process but ensuring that your Property Manager has a suitable workload helps protect you from mistakes when they are burnt out. Having additional assistance is also helpful with leasing, accounting and administrative tasks. Ideally within the industry a good portfolio size is between 100 – 180 depending on their experience, processes and the assistance they have.
How often do you carry out inspections?
Within Victorian legislation, legally routine inspections can only be carried out every six months, with some minor exceptions. In order to comply with your insurance and actively protect your property, your property manager should be carrying out inspections every six months. Some agencies offer inspections annually, which can place your property at risk should damage arise. It is also worth noting the process the Property Manager offers if damage arises at the property to have confidence that it is resolved in both a timely manner and one that protects your investment.
How long have you been in your role?
Stability is a very big issue within the Property Management industry and can be troublesome when managing your property. Recent research indicates that the average Property Manager stays in their role for less than two years. Consistently changing Property Managers causes a range of issues including bad customer service, lack of knowledge on the history of your property, as well as a failure to understand your expectations and the style in which you like your property managed. It is important that you select a Property Manager who demonstrates stability. Of course, there will be instances when your Property Manager changes, but this should be kept to a minimum to protect both your property and tenancy – as much as owners dislike having their Property Manager change regularly – so do tenants.
Will I always deal with you?
With the exception of the unavoidable, such as sick leave and annual leave, you should always be able to contact your Property Manager directly. Dealing with groups of Property Managers and Assistants creates disharmony and a lack of follow up. The person who is managing your investment should be available to deal with every aspect of your tenancy and have current knowledge. Whilst having a team of Property Managers or Leasing Agents undertaking different tasks might be more efficient for an agency, ultimately it is important that as an owner you have one reliable point of contact.
How do you handle repairs and maintenance?
Within Victorian legislation there are certain circumstances where a tenant or agent must act on urgent maintenance, and ordinarily this can be done without further authorisation to ensure the safety of your tenant. Outside of these circumstances however, it is important to understand how the Property Manager and agency deal with non-urgent maintenance, such as appliance breakdowns etc. Each agency has different processes and timeframes for undertaking these repairs, but it is important to understand the process to avoid surprise costs. Some of the considerations include whether there are preferred trades, pre-authorised spending limits, timeframes and the process for how these requests are dealt with. Aside from the consequences as an owner, keep in mind that it can be both inconvenient and inconsiderate for a tenant to have maintenance items unattended and can create disharmony for your tenancy.
How do you manage rental payments and arrears?
Commonly in Victoria, rental payments are accepted monthly. This ensures there are less opportunities for the tenant to fall into arrears, and creates a more streamlined system with less paperwork and administration. Funds are collected into a trust fund, and then distributed to owners at set intervals. It is important to understand the full process to avoid unexpected delays and missing payments. Some agencies pay their owners immediately after the rent is received, whilst some wait and pay at set intervals. Understanding when you should receive your money will help you plan for expenses and income. Equally important is knowing the options that the agency offers for tenant payments, to ensure it is convenient – this will minimise missed payments. When discussing this, it is also vital to seek information on how the agency deals with late or missed rental payments from their tenants. Having rent paid on time is crucial to your financial planning and your Property Manager should have a very solid process to avoid missed or late payments.
How do you treat your tenants?
The three F’s come into play here – friendly, firm and fair. It is very common to hear tenants complain about the conduct or responsiveness of their Property Manager and this is something you should aim to avoid. Ultimately, a happy tenant is less likely to cause problems and will result in a longer tenancy which creates security for your investment and saves you money and costs involved in leasing your property. Whilst the Property Manager should always work for the owner and represent their best interests – this can be done in a way that is conducive to a positive working relationship and will always result in a better outcome for your tenancy and investment. As the old saying goes, you get more flies with honey than vinegar.
These are amongst the critical questions that should arise during an interview with a potential Property Manager to assist you in gaining a thorough understanding and setting mutual expectations. Most importantly, you should seek to appoint someone who is honest and trustworthy with open communication – they will be your representative and should hold the same values as you do.
At Visser Estate Agents, we openly and honestly answer any questions from potential Landlords to ensure a productive working relationship. We encourage an experienced team, and focus on quality customer service in each of these areas to help ensure your investment property offers its best performance.
