Using a property manager
You may be tempted to manage your own rental property, but there can be good reasons to use a professional property manager to do the job for you.
Let’s address what can be the main issue of property management – the cost. A property manager could charge anywhere from 4% to 15% of your rent. But it could be money well spent, especially when you consider what’s involved.
How a property manager helps
A managing agent is responsible for a variety of duties that can include:
- finding suitable tenants
- making sure the tenancy agreement (lease) is correctly filled out and signed, and
- lodging the rental bond.
A property manager also handles day-to-day tasks such as:
- collecting the rent and maintaining rent records
- arranging repairs
- conducting regular property inspections
- handling any tenant disputes, and
- paying bills like water and council rates on your behalf .
Handling these everyday chores can make a landlord’s life easier, especially at tax time. Most property managers provide a single tax statement detailing rental income and any expenses incurred during the year.. It can be a real time saver when it comes to completing your tax return.
Selecting a property manager
When it comes to choosing a property manager, speak with several local agents to learn more about their services and their costs.
Some screening questions you might want to ask include:
- How many properties do you currently manage?
- How do you handle requests for repairs from tenants?
- Do you check repairs after they have been carried out?
- How do you screen prospective tenants?
- What steps do you take if the tenant is late with the rent?
If you’re satisfied with the answers given, it’s time to discuss management fees, in particular what is included and what’s excluded. Remember, the fee can be negotiable so don’t be afraid to negotiate a better deal.
Formalising the arrangement
If you choose to use a property manager, you’ll be asked to sign a formal agreement. It’s smart to read this carefully to be sure you are comfortable with all the conditions before signing on the dotted line.
If your rental property is located a reasonable distance from you, if you’re pressed for time or if you just want to enjoy stress-free investing, it can be worth using a property manager.
But even if your rental property is located nearby, using a property manager means you don’t have to deal directly with tenants, which is the way some landlords – and tenants – prefer it.
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- Chapter One : Things to consider before investing in property
- Chapter Two : Determining where to invest
- Chapter Three : Investment properties by dwelling types
- Chapter Four : Finance for your investment property purchase
- Chapter Five : How to invest in property
- Chapter Six : Adding value to your investment property
- Chapter Seven : Positive and negative gearing
- Chapter Eight : Getting your loan
- Chapter Nine : Selling your investment property