There’s more to property management than just collecting rent
Taking a hands-on approach to managing your investment property can save you professional management costs. But there’s more to property management than collecting rent.
Having your property managed by a professional can be very convenient. But it comes with a cost. Property managers can charge fees from around 4% to 15% of your gross rent in management fees . So, taking a DIY approach offers opportunities to save. But think about whether you really have the time and expertise to do the job yourself.
A property manager’s role goes beyond picking up the rent. They also:
Weigh up what’s involved to decide if a hands-on approach is a practical choice.
Self-managing calls for a good understanding of your legal responsibilities. As a guide, landlords may need to:
Keep in mind if you are self-managing your rental property you will need to deal personally with tenants. That means being available to respond to queries or repair requests. A DIY approach could work if you’re comfortable with this.
Not every investment property has to be a long-term rental. Your property could also be used for short-term lettings through the likes of Airbnb.
This can bring a new set of considerations. For starters, check council zoning laws permit short-term rentals.
Next, look into the costs that come with short-term lettings. You’ll need to furnish the property and clean it after each visit, adding an extra layer of expense. It usually costs nothing to list your property with AirBnb, but expect to pay a host service fee of about 3%.
Think about whether the property and location appeals to travellers. The short-term rental market is also competitive, with tens of thousands of properties listed on AirBnb in Sydney alone . Demand for your place could also be highly seasonal, depending on its location.
You’ll also need to keep good records of the income the property earns as well as any expenses and declare this in your income tax return.
The bottom line? Think carefully about your expenses and potential income to decide which option might deliver the best returns for your property and strategy.