The Informed Investor: do you need a property manager?
A property manager is more than an estate agent with specialised responsibilities and expertise- at a price. So the question is: do you need one?
Carolyn Parrella from Terri Scheer, Australia’s leading landlord insurance specialist, joined Steve Price to answer some of the more frequently asked questions about property managers.
What do property managers do?
It’s all in the name- property managers are responsible for all aspects of managing the property. This includes maintenance and insurance claims, taking care of the lease, being the first point of contact with tenants, conducting the initial background checks on potential tenants as well as organising and conducting regular inspections and reports.
How much do they cost?
This can fluctuate suburb to suburb and property to property, but generally you can expect to pay around 7% of your rental income. It’s unlikely you will pay less than 5%. However, it’s worth remembering this is tax deductible.
How demanding can you be of your property manager?
The responsibilites that property managers should be taking care of as part of their role are fairly comprehensive and shouldn’t require you to ask anything more of them. In most cases you’ll just need to ensure they are doing what they are supposed to.
What’s the most common issue property managers take care of?
Whilst property managers are very handy in cases of accidental damage, this takes comes in second to the far more common problem of missed rental payments- whether it be from tenants simply forgetting, a problem with automatic transfers or from instances where tenants abscond with money still owing.
So why is a property manager valuable?
Every task a property manager takes care of is one less thing for you to act on or worry about yourself. Additionally, a property manager will ensure their knowledge is up to date, which is especially important given just how many changes property legislation is undergoing at this time. Finally, as the property manager will deal with the tenant in most cases, it helps mediate in the case of any problem or dispute and protect the landlord-tenant relationship.