Choosing a quality property management specialist with years of experience in the industry is going to save you money in the foreseeable future. Here are the questions you should be asking.
So you have finally put your foot on the property ladder and purchased your first investment property. Your next impulse may be to work out how to reduce expenses to maximise your income. Perhaps you want to try to manage your property yourself or find the cheapest property manager available to deal with the nitty-gritty details you can’t get your head around.
However, this is one situation where you shouldn’t blindly listen to your gut, because having a quality property manager - and choosing an experienced one - is going to save you money in the foreseeable future.
Here are the questions you should be asking any potential property manager:
1. How Specialised Is Your Agency?
If you are using a big agency that offers both sales and rentals, be aware that those working in the rental department may be treating their position as a step in the ladder to the glamour of sales. Those agents may be cheaper, but they may also be less thorough and enthusiastic and treat their job as just a passing phase.
Boutique agencies that specialise in rental investments are probably a far better bet for property managers who are responsive to both the owners and the tenants. These companies employ managers who are specialists in the rental market, and who will more likely have a pro-active approach towards growing your wealth through property investment.
2. What Areas Do You Service?
When choosing a property manager, you want to go with someone who is a specialist in your area. If you do not have children, you may not know that your property is near a high-performing school – but your manager will and this fact and others will be included in your advertisement.
There might be a scenario where no one shows up to the scheduled inspection. A property manager who knows the area well will advise you to lower the rental price of the property, or to wait another week because finding a tenant for the price you set is inevitable.
3. How Can You Ensure My Property Maintains Its Value?
Property managers know things that we don’t often think of. They know that pets may scratch floors simply by walking on them, that pools and gardens don’t maintain themselves and that uninsulated floorboards in units will lead to noise complaints.
A good property manager will be detail-oriented. They will have questions and conditions for pet owners to meet, they will include the fee for a gardener or pool cleaner into the lease and they will give you advice about acoustic insulation. So make sure to ask your property manager if they see any areas in your house that could potentially be neglected and what they will do to prevent that neglect from occurring.
4. How Can You Make Sure I’m Going To Make Enough Money?
When leasing a place there are a myriad of ways to save money and your property manager should be familiar with all of them. If you have a newly-renovated place in a state-of-the-art building they may suggest putting together a depreciation report that can be used by your accountant at the end of the financial year. There are plenty of other quirks they are privy to due to their experience in the field.
5. How Contactable Are You In A Crisis?
Things go wrong with every property and these dilemmas don’t wait until business hours. You need to know how quickly your property manager will send a plumber to fix a blocked toilet or burst hot water system. The faster it’s fixed, the happier the tenant. And your property will also be saved from further catastrophes.
6. How Will You Make Sure I Have Good Tenants?
The best way to ensure that your investment gives you the best return is to have reliable tenants. You need to ask your property manager how thoroughly they examine the potential occupiers. They need to call references, check bank statements and look at their previous rental history with a magnifying glass.
Sometimes you will have more than one application for your property. This is where your property manager’s advice is crucial.
7. What If My Tenants Do The Wrong Thing?
If your tenants are not paying rent, are receiving too many noise complaints or are damaging the property, your property manager may need to take them to tribunal. Ask them about the process – the costs and their success rate.
While it may be tempting to ask your potential property manager “how much do you charge?” and leave it at that, what you should also be asking is “what value of service will I get for that price?”