WHAT DOES A PROPERTY MANAGER DO?
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Before you engage a Property Manager to look after your investment property, it’s really important to understand the role they will play and what their responsibilities will be. Some people will tell you that all property managers are the same, but the truth is that they all differ – either in experience, attitude, the service they offer and the fee’s they charge. In the very broadest of terms, Property Managers look after the leasing and day to day management of your investment property. They are responsible for finding tenants, making sure your rent is paid on time, coordinating tradespeople to fix any issues and ensure you are compliant with all the laws which govern being a landlord. They can even pay all of your property related expenses for you. The various levels of service can vary between agencies and property management companies.
As a property manager, it is our experience and market knowledge that allows us to set your property at the right price. The rental market is constantly changing and is driven by supply and demand. In the last few years we have seen an increase in apartment construction which could mean that within a week of a new building being completed, dozens of apartments could flood the rental market having a drastic effect on the price of existing properties that are available for lease. But when it comes to rent, there is are many things your property manager will be responsible for:
- Setting the rent: Knowing what is happening in the current market is highly advantageous. Pricing your property too low could mean your eating into your rental returns and pricing your property too high could mean your property will be vacant for an extended period of time. My goal when setting the price for your rental property is to always achieve the highest possible price, with the shortest possible vacancy rate.
- Collecting your rent: Collecting your rent in full and on time is a key task for any Property Management company. This process should begin when we find you a tenant by ensuring they have a clear understanding of the expectation we have. It also needs to be a simple process for them. Offering tenants the ability to set up a direct debit or an automatic monthly payment helps to ensure that tenants don’t ‘forget’ about paying their rent. If the rent isn’t paid, it’s important to keep good records of this as you may need to take your tenant to VCAT and evict them if they are constantly late or simply stop paying all together.
- Increasing your rent: Although the rent is fixed throughout the period of the fixed term lease, once that initial period ends, you are able to review the tenants rent and increase it. We do this annually for each of our clients (as permitted by the Residential Tenancies Act). When deciding if we should increase the rent, we consider similar properties which have recently leased and those currently on the market. This gives us a good understanding of the current market and if there is an opportunity to increase your rent or not.
As property managers, one of our responsibilities is handling all tenant related activities. This starts with advertising your property to attract the right tenants, making ourselves available to conduct open for inspections, thoroughly screening rental applications, preparing and signing all lease agreements, enforcing the terms of the lease agreement, handling any complaints or tricky situations on your behalf, working through an maintenance issues, ensuring rents are paid as well as all the other general activities we do to ensure they’re happy with where they are living.
- Tenant selection: Finding the right tenant is an often overlooked aspect by many agents who are simply looking to fill vacant homes. But not doing adequate checks can be a very costly mistake. Checking tenants rental history, confirming their employment and also using Google, LinkedIn, Facebook and Instagram can often give us a pretty good idea of the type of tenant that’s applying. Although we aim to find you a tenant as quickly as possible, we’re also not prepared to put just anyone into your home.
- Doing the right thing: Most tenants will do the right thing. However, it’s also important to ensure they know what ‘the right thing’ is. Ensuring a tenant is onboarded properly at the start of a tenancy can often ensure a smooth tenancy moving forward. This includes explaining their rights and responsibilities as outlined in the lease agreement and also covering what happens if they do the wrong thing. This can sometimes lead to VCAT hearings, tenant blacklists and evictions for the more severe issues.
- Evicting a tenant: If you do find yourself in a situation where you need to evict a tenant, it can be a quite lengthy and confusing process. There are dozens of notices which can be sent out depending on the reason, there are different periods of time you need to allow before issuing certain notices and then you have to ensure they are sent in the right way. Once that’s all done, then you have to go through the process of applying and presenting your case at a tribunal. This is where an experienced property manager is worth their weight in gold. Ensuring all the steps are done correctly, the right evidence is prepared and presented in the hearing will ensure you get the result you want in the quickest way. Failing to follow the right steps and prepare the right evidence could see your case thrown out and you needing to start the whole process of again.
- Rent money: As the rent is paid directly to your Property Management company, most will offer the ability to pay any invoices that relate to the property our of the rent that’s received.
MANAGING YOUR PROPERTY
The property manager you hire will be responsible for the day to day management of your rental property. This will include managing the maintenance and repairs to ensure property stays well maintained for the current tenants and in a good condition for future tenancies.
- General Maintenance: One of the key tasks your property manager will have is to make sure your properties condition doesn’t deteriorate. This general maintenance could include servicing appliances, heaters, air conditioning units and regular cleaning of gutters. These are more preventative tasks to ensure that you avoid costly maintenance in the future.
- Property Repairs: Part of owning an investment property is fixing things when they brake or get damaged. A good property manager will be able to determine who is responsible to cover the cost of the damage (sometimes this could mean the tenant if they have caused the damage), they will also have great relationships with tradespeople who can attend to issues quickly and not over charge for their service. If you’re handy, and available, you can also fix certain things to as the landlord.
- Routine Inspections: Every 12 months, your property manager should be conducting routine inspections of your property and providing you with a detailed report with notes, photos and a recommendation of what needs to be done. The purpose of the routine inspection is to pick up on anything your tenant may not have reported to us or noticed on their own. A property manager will know what to look for and where to look to spot potential issues which may go unnoticed by the tenant.
RENTAL PROVIDERS (LANDLORDS)
Although your property manager will deal with all the day to day activities of managing your property, at the end of the day, you are the owner. We work for you. You have the final say.
- Open communication: The relationship between you and your property manager needs to be clear and open. As an owner you expect to be notified about how your investment property is performing. Your property manager should be always updating you on vacancy rates, your rental payments, any property related expenses and any maintenance issues. Make sure you explain to your property manager how you prefer to be contacted – email, SMS or even Whatsapp.
- Rent Money: Because your Property Management company is responsible for collecting your tenants rent, make sure your property management company has a competent and experienced Trust Accountant. They will be the ones paying your invoices and disbursing your money to you.
Finding a Property Manager with experience and knowledge of the Residential Tenancies Act could protect you from breaching some laws and being liable for paying fines and damages. Every state has their own laws regulating the duties of landlords, their agents and tenants. Your property manager will be on the front lines of every aspect of your property. From managing tenants, dispute resolution, representing you at tribunals, coordinating with tradespeople and many other responsibilities. So ensure you find a property manager who is there on your side and looking out for your best interests.