Choosing the Right Property Manager

Choosing the right property manager

From time to time, Blink gets new landlord clients that have some horror stories about their previous property managers.

One, for example, had a story about how their property had been vacant for a while, despite weekly inspections taking place. The landlord was talking to the manager to figure out why and the manager replied: “They might be getting a bit turned off by the shabby old furniture and old cutlery in the drawers”.

“Furniture?” The landlord replied… “The unit is not supposed to be furnished.”

Turns out the previous tenant had moved overseas and left a whole lot of clutter in the apartment. The property manager hadn’t even realised and just assumed it was a furnished apartment, without checking the information the management firm had on file.

The landlord was rightly stunned. The good news? Sacking a property manager is easy. You just have to serve them a written notice and engage a new property manager. The new manager will then arrange the handover directly with the old one.

Do you have a good or bad manager?

A good property manager can save you time and money, particularly if you have several investment properties or live in a different area to the properties you own.

A bad property manager may not respond to your calls, fail to maintain your property or leave it untenanted, putting a serious dent in your cash flow.

It’s your property manager’s responsibility to market your property to attract tenants and set the rental rate to help you maximise your monthly income. They collect rent, screen occupants, and handle tenancy issues so you don’t need to be involved in the day-to-day. It’s their role to organise repairs and maintenance and help ensure your property is legally compliant.

It’s also their job to carry out inspections up to four times a year, address any issues directly with tenants and ensure they are resolved in a timely manner.
It’s up to you how frequently you want to contact your property manager although every month or two is usually enough to keep abreast of how your properties are going.

What to look for

When selecting a property manager, it pays to do your research. Try and pick someone with local knowledge and a portfolio similar to your own. Look at their current rental listings to see how they market their properties and ask around or check online reviews for managers with good reputations.

Ask them direct questions. How do they handle problem tenants? How often will they conduct inspections? Or how often will they be in contact with you? Communication with your property manager is key, and if you find them hard to get a hold of, check on your property as it may not be getting the attention it needs, or something might be wrong.

Another red flag is when your property manager fails to maintain the property. You should receive reports every six months and if you find they are not staying on top of repairs and maintenance, the chances are they are not doing their job, and your tenants aren’t happy either. They should also help ensure your property remains compliant with housing regulations and property laws as failure to do so could result in breaches and lawsuits.

The last thing you need is an untenanted property causing you cash flow issues and the associated stress. Even in a slow rental market, a good property manager will guide you towards tenants, even if this means giving the place a fresh lick of paint or reducing rent until the market recovers.

How to change property managers

First, check your required notice period (usually 3-9 weeks) and put your intention to terminate in writing. There is a common misconception that you are “locked in” with your property manager for the term of the lease, which isn’t the case.

Next, check for any hidden fees in your contract. Ideally check the terms and conditions before signing up with a property management company as some will charge for early termination. Lastly, request all records of leases, security deposits, income and expenses and make sure your tenants are informed well in advance to ensure a smooth transition.

Finally, engage a new property manager and allow them to take care of the rest of the handover.