|July 17, 2017||No Comments|
Deciding to appoint a property manager for your investment portfolio can reduce your time commitment as a landlord.
While self-managing a property might appeal to some as a way of reducing overhead costs, a property manager is able to act for you and complete many of the responsibilities on your behalf. It’s worth considering the following factors to help you decide if you should appoint a property manager.
A property manager can play a vital role in the rental process of an investment property.
Property managers will seek to maximise your weekly rental income and source high quality tenants who will best look after your asset.There are a number of advantages to appointing a property manager to manage your rental property, including:
•The services a property manager can offer you and the tenant are generally more extensive because they are property management professionals
•Property managers have good local contacts when repair work is required on the property
•Tenants often find it easier to access and discuss matters with property managers
•The property manager will act as a buffer between you and the tenant if something goes wrong
What to expect from a property manager:
Renting a property requires a lot of work and a high level of commitment, which many landlords don’t have the time to put in. A good property manager will be able to manage all the headaches for you. Property managers have the ability to screen potential tenants through comprehensive databases, which list tenants who have a history of not paying on time or damage to a property.
When appointing a property manager, you will sign a property management agreement, and much like a lease, its terms and conditions form a contract. These agreements vary in length and contain notice periods for termination.
Read through these carefully and discuss clauses that allow the property manager to authorise and spend up to a specified limit for repairs.
The functions of the property manager include:
• Advertising for tenants
• Screening, interviewing and performing reference checks
• Negotiating terms on your behalf
• Explaining the tenancy agreement to tenants and obtaining signed lease documents
• Preparing the Property Condition Report
• Lodging the Bond with the relevant bond board or trust
• Collecting the rent and transferring it to your account
• Sending you monthly payment and commission reports
• Receiving and conciliating rates notices
• Arranging quotes and repairs and documenting these in your account
• Conducting property inspections
• And generally dealing with the tenant for all matters on your behalf
Property Management fees
There are a variety of ways in which the property manager gets paid but the most common is to charge a percentage (%) of the gross rental collected per rental period during the term of the lease. This is usually between 5-15% depending on what services are provided.
The property manager will also probably charge a ‘letting fee’ for each new tenancy, which is usually one week rent (negotiable) and may claim costs associated with the advertising of the property in newspapers or on rent.com.au
All of these terms are negotiable between you and the property manager.Disclaimer: This article has been written for the purpose of providing general tips and recommendations only and does not purport to represent legal advice and does not claim to be a complete documentation of the topic. You should obtain specialist commercial and legal advice from relevant service providers and professionals with regard to your own circumstance and requirements and legislation in each state. This content is provided in conjunction with the Terms and Conditions of use of the RENT website.
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