Using a property manager does come at a cost, but does the benefits outweight them? We think so if you have a professional and experienced property manager at your service!
We are joined by CEO of Turner Real Estate, Emma Slape, as she chats to Marissa about:
- what property managers can do for you
- the different ways to set up a tenancy
- liabilities of tenants and landlords
- why a professional and reputable property manager is important!
Turner Real Estate is the largest independently owned property management company with over 3000 properties managed in Adelaide! You can find out more about them here.
Click on the image above or here to watch the full video!
Who are property managers and what do they do?
The Residential Tenancies Act – this governs the rules and regulations between tenant and landlord interactions. There is a lot of complicance requirements, and trying to do this on your own might be a large headache. This is especially true when you have a portfolio of investment properties, or run into complications such as rental arrears, maintenance, rental agreements and so forth.
Property managers can also help you vet for tenants, and hopefully find you a good one!
One of the great things property managers can do is that they vet and conduct background checks on the prospective tenants! This will help ensure a good quality tenant for your rental property and ensure that your investment property is generating income, and also being well maintained by the tenant. This protects your investment property from unnecessary damages.
A good property manager can also help you sort out rental history referrals or first time renters. They will also have access to a private database of rental history which might be too costly for landlords to subscribe to. Many property management companies also work with each other, where they can provide rental history or referrals for prospective tenants.
What makes a good property manager?
A good property manager will need to have a good understanding and awareness about the Residential Tenancies Act. This is especially true when issues arise with tenants and landlords who tried to self-manage. This means good record keeping, photo records of the state of the property, routine checks on the property, etc. A good property manager will usually be able to invest more time and energy to protect your investment property and check in on the tenant. Additionally the property manager then provides a summarised or detailed report of the rental property to the landlord, and flag any issues to the landlord.
Are property managers registered or regulated?
Property manager are registered and licensed by the Consumer and Business Affairs in South Australia. There are training courses which need to be completed to be eligible for licensing. The team at Turner Real Estate adds to that, by putting potential property managers in a training role for at least 2 years, with supervision from an experienced property manager, before they can work independently in the property management field. The experience and teamwork is key to maintaining a high level of attention to the property management work they do.
Tenancy exits and starts
The property manager can also help a landlord check that a tenant has moved out and restored the property to its original state. This includes the clean up, not leaving any bulk items or furniture behind (a common issue) and so on. The property manager will also ensure that a new tenant checks and verifies that the property condition is fit for live-in and will agree to restore the property to its original state at the end of the tenancy.
Managing different types of leases, or just monitoring and extending the lease
Sometimes landlords can forget that a fixed term lease agreement has lapsed and the tenancy has slipped into a periodic lease. This will change the dynamics of the lease such as:
- landlords now need to provide 90 days notice to evict, whereas tenants only need to provide 21 days notice to move out
- insurance changes to cover rental income protection
In general there is no advantage to the tenant or landlord under a periodic lease, as it brings instability to the rental term period. Property managers keep an eye on this to protect your investment propety from slipping into a periodic lease.
Can you switch property managers?
This depends on a couple of factors, such as:
- the initial term of your agreement with the existing property manager
- the nature or reason for changing – not managing in accordance with the Residential Tenancies Act?
- the notice period stated in your contract to terminate the property management service
It is advised that if you do have a complaint or grievance, it is best to speak to the agency manager or principal first. If that fails, it is then possible to contact The Real Estate Institute of South Australia (REISA) for mediation. When both parties agree to terminate the existing service agreement, you can then look at appointing a new property manager.
I am looking for a property manager. What questions should I be asking?
Here are some of the questions we think you should be asking:
- What is the experience of the property manager?
- What is the backup when the property manager is away?
- How often does the property manager conduct inspections?
- Do you get pictures of the inspections?
- What is the complaints or feedback resolution process?
- Can the landlord attend to the inspections?
- Is the agency a sales agency? Or a property management agency?
- Does the property manager know about the area where the property is located? Think NBN, school zones, bin days, etc.
You can also check public reviews of the property management and also the history of how the property management has dealt with tenants. Your investment property is valuable and you should only leave it in the hands of someone you can count on.
Do property management fees vary?
Fees can vary quite a bit, but you will need to consider the longevity and the amount of work done by the property management agency. A cheaper management fee might mean a smaller team and lesser work done per property. Do your background check on the property management company, to ensure that you do get paid regularly, be it monthly or twice a month.
What else should I be considering for my investment property?
Know what type of investment property are you buying into. You have to understand the investment property you have and what area it is in, the types of tenant who will be attracted to it, and what is the rental appraisal for the property. This will all help you set expectations, and also work out a targeted strategy to find a quality, long-term tenant for your investment property. This also helps your property manager accurately assess your needs and effectively protect your investment property.
At Rise High Financial Solutions, we do more than just mortgage broking
Our service is not just about finding you that one-time investment property loan for your current needs. We work with you to ensure that you are financially set and secure for the future. That is why we work with reliable partners such as Turner Real Estate, to help you protect your assets for your financial future.
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