You have to keep constant attention to details when managing your own rental property/properties. Sourcing tenants or retaining them is a time-consuming job. You end up wasting your time that you could have easily spent with your friends and members of your family. This is amongst the main disadvantages when you manage your investment properties by yourself.
This is the reason why most property owners want to avoid the headache of being involved directly in managing their investment property on a daily basis. They choose to hand over those responsibilities to property management companies, which provide the service that they need. It is essential to find a suitably qualified manager who can personalise the service for you. Therefore, it is essential that you have in-depth knowledge about the kinds of services you require to ensure that you have peace of mind. An appropriate property manager will help you to add substantial value to your investment portfolio.
Find below some of our top tips, when finding a property manager who suits your needs:
1. Is your Property Manager the owner of an investment property?
Query the professional if they too are the owner of the property. This provides you with a sense of comfort in the knowledge that they will realize how important your asset is to you. A Property Manager who themselves own property, in most cases, will have a greater understanding of what is necessary to ensure peace of mind.
2. Consider the number of properties they manage.
Ask the Property Manager how many properties and area of coverage they control. This will help you figure out to decide if a specific Property Manager can take care of your property. On a typical base, the ratio of manager to properties is 1:100. Ask for referrals, if possible, or survey some of their currently managed properties. This will help you make sure whether they are doing the job they ought to be doing. Are they maintaining the grounds? Is the exterior presentable and clean? These are only two areas that provide you with an indication of the level of care of the Property Managers.
3. Hire a licensed Property Manager.
According to law, all Property Managers should be registered and must hold at least the Real Estate Salespersons Certificate. Make sure that they have this certificate when searching for a Property Manager. You can also check their comprehensive real estate licence. This provides you with the satisfaction that you are not dealing with laypersons that could lead to loss of income via rent and cause you unnecessary legal problems.
4. Ask about their management fees.
The management fees differs a lot, based on the degree of service provided. Most property managers charge fees ranging from 8 to 10% of the rental income. Then there are sundry fees like administration, photography, maintenance, and advertising. An agency that wants to grab your business by charging low fees may not have the inclination or time to provide your property the premium service it deserves.
5. Examine the term and conditions in handling maintenance and repairs.
Make sure that you set up a maintenance reserve out of your monthly rental income in order to cover minor expenses. As an example, you can authorize them to spend up to $800 in case of an emergency, without contacting you. However, ensure that they provide you with acceptable receipts for all such expenses. You must be informed and give your consent prior to the repair for anything above that amount.
6. Check for regular schedules regarding property inspection
Query the Property Manager if he has a precise schedule for inspecting your property. Assessing the condition of the house is a part of the procedure, and a quarterly inspection should be conducted too. They should hand over to you a copy of the report following the completion of each inspection.
7. You should be clear on the procedure for an accounting of funds and the time frame
The majority of property management agencies pay landlords on a weekly, fortnightly or monthly basis. To ensure that you can plan beforehand, it is important to know about the payment schedule.
8. A thorough tenant screening process
This aspect is amongst the most important duties of the Property Manager. Screening ought to include credit history reports and background checks. Each and every applicant should be screened.
9. Ensure your Property Manager is accessible.
Frank communication is extremely important, particularly if you are not at home. The Property Manager ought to be available at a time convenient for you, and not for them. Communication ought to be both offline and online and successfully serve as a bridge between all parties.
10. Review all property management contracts.
Review the contents of the management contract and ensure that the points mentioned above are per your satisfaction. If feasible, ask someone who has in-depth knowledge about contracts to confirm that the company meets your requirements. Recommend inclusion of a termination clause so that there will be no conflicts if either party need to withdraw from the contract. The main factor is you ought to be aware of problematical issues and ensure that the contract addresses those issues with solutions.