Do I Need To Hire A Property Management Company In Melbourne?
Whether you have recently acquired your first investment property or have a growing portfolio of rental properties, the inevitable question of hiring a property management company in Melbourne might be playing on your mind. There are indeed reasons for and against choosing a property manager in Melbourne to handle your investment with the overarching considerations being time and money. Often the itch to offload the management duties of your investment property or portfolio to a property management company comes into play when the amount of properties has grown beyond your ability to manage, the property is in a different state or country, the tasks of managing a property are too time consuming or stressful for you, or the investment is shared and a third party management company is the most fair and logical solution. In any of these scenarios, the option of a property manager may be worthwhile.
Understanding the main roles of a property manager in Melbourne
Property management companies in Melbourne are responsible for the daily operations related to a real estate investment; these may range from residential apartments and homes to commercial offices, retail and industrial properties. Often, property managers will provide an end-to-end management solution, consulting landlords on an as-needed basis throughout the term. In Melbourne, there are property management companies who are negotiable and flexible with landlord involvement. It is fair to say that the key tasks of a typical property manager in Melbourne includes (but is not limited to)
- Valuing and marketing the property for lease in line with current rental trends
- Screening and reference checking potential tenants
- Negotiating and executing lease agreements, bond documents, key handover
- Undertaking periodic condition reports
- Collecting rent on behalf of the landlord and managing tardiness or debt
- Managing maintenance requests and repairs
Expertise can be advantageous
Whilst the cost of hiring a property manager can be hefty, a good property manager in Melbourne can in fact save you money in the long run. Consider the following;
- Faster leasing and re-leasing rates
An experienced property management company in Melbourne will likely have access to a bank of qualified tenants on the hunt for the perfect property. These contacts naturally lead to finding new tenants quickly, which fast tracks rental income for you as the landlord.
- Higher weekly rental rates
It is common practice for professional property managers to strike the right balance between advertising a home at a high price while attracting tenants quickly.
- Trade contacts and relationship benefits
Most good management companies in Melbourne have a trusted list of local tradespeople who will undertake repair and maintenance tasks at a reduced rate. Landlords are able to leverage significant cost savings over time, on the back of these two-way relationships.
- Tenancy knowledge and communication
An experienced property manager will have seen first-hand or heard of hundreds of different day to day issues that arise when managing a property. Being a third party, they are emotionally removed whilst still invested in achieving amicable and optimal outcomes for whatever may occur throughout a tenancy; this includes dispute resolution, payment delays, unlawful behavior at the property, risk and safety management, etc. For you as the landlords, these kinds of issues can be extremely time consuming to deal with, especially as you likely have other commitments to attend to. Leaving the liaison to an expert is recommended.
Are you prepared to hand over control?
Landlords considering hiring a professional property management company in Melbourne do need to relinquish their participation in the day to day management of their property. For some this is welcomed, for others this may be difficult. Often, property managers need to make decisions which may not be what the landlord would instinctively want. It is ideal to discuss your level of required involvement in decision making prior to locking in a manager. This will enable a healthy relationship with clear expectations from day one.
Are you aware of management fees and ongoing costs?
One of the biggest turnoffs for landlords is the cost of hiring a property management company. With most Melbourne rental management companies charging between 5%-9% for management as well as leasing fees and advertising fees, it can seem excessive. If you take into account the above services as well as time savings for the landlord, the costs may very well be justified. The best thing to do is ask for full transparency regarding management fees so that you know exactly what you are up for at every stage of tenancy and in between, during vacant periods. The bottom line is, you do not need to hire a property management company , but you may absolutely want to. Choosing the best property management company for your Melbourne investment If you believe the pros of hiring a property manager outweigh the cons, the next step is finding the right company.
Do your research. Referrals from friends or fellow investors are always a good starting point. You can also look online at active agents in the area and shortlist a few to make enquiries with. Your initial discussion with potential property managers in Melbourne should cover the following aspects so that you can make an informed choice:
- What are the management fees and landlord out of pocket costs throughout the service period?
- Which property manager will actually be handling your property’s day-to-day management, and does this manager present as knowledgeable and an efficient communicator?
- How comprehensive is the tenant screening process?
It is important that you feel ‘in safe hands’ when selecting a property manager. This may not always mean selecting the agent with the lowest fees, or biggest rental department. You should feel a strong sense of confidence in your chosen real estate manager’s ability to take care of things on your behalf. A manager who will respect your level of involvement and provide transparency and clear reporting for the duration of the management period. This will allow you to get on with other things and reap the financial benefits of owning an investment property or more in Melbourne. Besser & Co are dedicated to maximizing landlord’s rental investments and building long lasting relationships with every client. Get in touch with the property management specialists at Besser & Co today.