Professional property management is essential when managing your property investment, but it can sometimes be hard to find. If you have suffered once, it is challenging to trust the property manager’s ability to care for your investment.
Don’t have sleepless nights worrying about your investment property being looked after by someone incapable. A good property manager gives you peace of mind and higher returns on your investment property.
Trust in the property manager is an essential issue for landlords, especially if you need to appoint a new agent or employ a manager for the first time for that property.
In this blog, we share nine signs of professional property management services to help you find the right property manager for you. You want a proactive person to ensure your rental property is always in top condition.
They have good communication skills
Professional property managers have excellent communication with the landlords. They know when to discuss your investment property and what they can resolve without bothering you personally. An experienced property manager will respond in a reasonable time when you have a query.
Expect a reply no more than two hours later, even if it’s only an acknowledgement of your concern and a promise to investigate it.
Excellent communication by your property manager helps you to:
- Keep tenants happy,
- Know what is going on on your property,
- Get better quotes on property maintenance, and
- Resolve problems and tensions appropriately.
Before signing a property manager, test their response time. Suppose it takes longer than a day to get back to you after you have expressed your interest. In that case, they probably won’t respond quickly when an issue arises.
Although you would love to have a property manager who is solely taking care of your property, this is unlikely to be the case. The real estate business is always busy, and the property manager will handle multiple properties, tenants, and owners simultaneously.
Did you know that the average property manager has as many as 150 properties in their management portfolio? You can see why exceptional organisation skills are essential for a professional property manager.
A property manager needs a detailed and easily accessible database of their properties and a seamless filing system to maintain the necessary paperwork for each rental. Technology-savvy agents are likelier to be on top of the required work.
Ask a potential new property manager about the tools they use to help them stay organised for all the properties they manage.
Without these structures, your property manager could struggle to stay on top of the varying needs of all properties.
Consider if your current property manager provides inspection reports showing where your property needs maintenance or outlining potential areas of concern for the future. Suppose your tenants reach out to you because the property manager is not responding to requests for repairs. In that case, it could be time to switch property managers.
They’re good with technology
A property manager using technology will have good organisation skills, which is excellent news for you as the owner.
New apps and database programs can assist the tech-savvy property manager. These programs notify the property manager of upcoming issues or respond quickly to other aspects of the property management, such as dealing with requests, lease renewals, or issues like late rent payments.
Technology should never replace personal management, but it can help the property manager stay on top of the busy workload.
If the technology isn’t working well, the property manager will find it difficult to access the information and will not manage the property well. However, if the technology helps you to know what is going on in your property, the property manager is doing it right.
They have the knowledge they need to help you succeed
Test the ability of your property manager. A legitimate property manager has extensive knowledge and expertise in the property market and can advise you on successful property investment. Professional property managers should have the answers you need or, at the least, be able to find the information quickly.
You need your professional property manager to have:
- Local market knowledge and
- Legal knowledge.
LOCAL MARKET KNOWLEDGE
Knowledge of the local rental market means your property manager will know:
- How to attract the highest quality tenants by making your rental property stand out in the local market,
- The amount of rent to charge on your rental property,
- The features local tenants are looking for in a property,
- How to attract tenants through the advertising campaign, and
- When demand is quiet (not the time to advertise or get rid of tenants).
Local knowledge like this helps your property manager to keep your vacancy rates low.
Many different aspects of the legislation impact landlords and tenants, and it changes in each state and territory. It would be best if you had a property manager who is fully aware of the critical legislation and will keep updated as the laws change. You rely on your property manager to prevent legal hassles or going to court or a tribunal over a tenancy issue.
For example, you decide you want to evict your tenant. Are you aware of tenants’ and landlords’ rights and responsibilities in your state? Do you know how much notice you must give the tenant? A professional property manager will know these things and can walk you through the necessary processes and paperwork to legally evict your tenant.
Professional property managers can answer your real estate legal questions.
They’re personable and make you feel at ease
Imagine if your property manager was like Scrooge and ‘Bah Humbugged’ everything your tenants wanted. You would soon lose your tenants and would lose money. A property manager must deal well with people. You want someone who can build good landlord-tenant relationships and help you to keep your tenants happy.
A friendly, positive, and professional manner will help your property manager to engage effectively with landlords, tradespersons, and tenants. A property manager needs exceptional customer service skills that build trusting relationships.
The better your property manager gets along with your tenants means higher the probability:
- Your tenants renew the lease,
- You will receive word-of-mouth recommendations about your property, and
- You’ll receive notification of maintenance and repairs at a reasonable time.
They’re assertive when the situation calls for it
While every landlord hopes for the best tenants, in the real world, things will go wrong in the real estate industry. Tenants may be late in paying rent, or things get damaged and need repairs. When this happens, you need to trust your property manager to make decisions quickly to resolve the issues and keep your investment on track.
While your property manager should always show your tenants respect and compassion, they do need to be assertive at times, according to the situation.
Whether dealing with a problematic tenant or addressing issues with a less-than-perfect contractor, your property manager must know when to be assertive and accommodating.
Reviewing a copy of your property manager-to-tenant correspondence can let you know whether your property manager is assertive when necessary.
The highest quality property managers know when to push a tenant in rental arrears and when to show some leniency, allowing the tenant to get back on track and stay in your property.
They have the experience to back up their decisions
Knowledge gained from reading is good, but professional experience adds to the learning. You want a property manager with a wealth of personal experience or who is part of a highly experienced property team who will share their experiences.
Experience is one of the top elements property owners want in a property manager, and with good reason.
An experienced property manager is an expert in:
- Resolving repair and maintenance issues,
- Getting fair quotes from contractors,
- Dealing with problematic tenants,
- Conducting routine inspections, and
- Coping with day-to-day things like rent collection.
Asking questions about years of experience in real estate and how many properties the person has already managed can help you to find an experienced property manager. If the individual lacks personal experience, ask how they will compensate for that experience. Do they have easy access to team members who have experience if sticky situations arise with your property?
They take accountability
Accountability is a cornerstone of professional property management. No one is perfect, so mistakes will happen sometimes. However, a trustworthy and experienced person will come clean about their mistakes.
When problems arise, your property manager should take responsibility for their errors or omissions, such as neglecting to see to drainpipe they noted was starting to rust in their last inspection when the downpipe bursts. They must avoid the blame game but should take responsibility if their mistake or omission has led to an issue.
Honesty and transparency are two essential criteria for high-quality property management.
They have an investor mindset
A professional property manager will help you to increase your profit. You are investing in the property for your future financial security, so you want a property manager who will treat your property as their own.
A good property manager will recommend ways to improve the returns on your rental property and will:
- Minimise vacancy rates,
- Maximise rental yield,
- Resolve maintenance issues before extra costs emerge,
- Increase rent when appropriate, and
- Add value to your property with local insights.
A good property manager will also know your investment strategy and the tax implications. Whether your property is positively or negatively geared could make a difference in how the expert manages your property, maximising returns for your investment strategy.
Without an investment mindset, a property manager could quickly reduce cash flow. Still, an experienced property manager will provide the correct management for your substantial investment.
Do You Need a Local Property Manager? Local vs National Compared
Many property owners believe local property management is the best way. Colleagues and other investors you trust will expound on the benefits of a regional property manager whose expertise in the region can help you find good tenants.
It seems simple enough. A local property manager focusing on a smaller area will know about your advertising in that neighbourhood. Many investors assume the smaller agency with fewer clients will have more time to manage their property individually.
Trust in the local property manager can be a fear for landlords.
Local property managers may not be the right fit for you and your rental property. Both local leasing managers and national property managers have pros and cons listed below to encourage you to choose what you need for your property.
Using a local property manager
You may have heard that a local property manager is essential. Yet, there are highly experienced teams in national agencies that can offer similar services.
Here are the pros and cons of using a local property manager compared to a national property manager.
Pros and cons of using a local property manager
A local will know the local area and market, enabling them to target your advertising to the right demographic easily.
Local real estate agents may get insider information or contacts. They may know before a particular property comes onto the market. They can help you to build your investment portfolio by finding properties that are perfect for you.
Rental inspections are easy for locals to attend to and can respond to callouts in the local area. Notably, a local who regularly passes by your property may be able to observe potential misconduct to the property.
Local property managers know local vendors and usually work with reputable tradespeople and contractors in the area.
Generally, local property agents will manage fewer properties, so they may have time to personalise the service to you and your tenants. This personalised service does come at a higher cost, though.
One of the biggest cons is that local property agents are small, and problems are associated with this.
The old issue of economies of scale can impact smaller agencies. Smaller agencies do not have as much money to invest in processes, technology and resources as a national property manager. A larger company can streamline the same processes across all the properties they manage.
Generally, local property managers charge more, typically charging rates as high as 7 to 10 per cent of your rent in property management fees. They use a traditional property management model, charging extra for administrative costs, credit checks, etc. These fees can eat into your profit from your investment.
A local property manager might be inexperienced. They work on a smaller scale and therefore manage fewer properties.
Suppose your property manager has not dealt with problem tenants before or is unsure about eviction processes. In that case, they can make errors and lose credibility with your tenants.
Using a national property manager
Now, look at the pros and cons of using national property managers to manage your property.
With a reputation of being bureaucratic, slow to respond, and lacking flexibility, national property managers have not always offered value for money over the years.
However, national property management is a good option for many. Federally based agencies with more significant economies of scale can afford to invest in clever solutions and technologies that help them provide faster services and still connect with local expertise.
Pros and cons of using a national property manager
With the grander scale of work and more properties to manage, national property managers have reduced overheads per property and can charge lower rates.
National property managers have extensive resources and expertise throughout the company. They operate at a larger scale and can afford the costs of more extensive tenancy databases, reducing the risk of bad tenants in your property.
National agencies have programs dedicated to identifying trends and data at their fingertips to grab market insights.
A national property manager must know the legislation in every state and territory. They can help you to stay compliant, even if you own many properties in different forms.
So, should you use a local or national property manager?
Although local knowledge is essential, using a smaller agency with destructive processes will cost you money. The most important decision is to check whether it is a good property management company. Go for quality.
Use this guide to find a good property manager, and you’ll know what to ask.
Other than that, there are some situations when using a local or national property manager is best.
- Use local property management to benefit from local expertise and a more personal approach. Remember that you must understand what the agency includes in the property management fees. It won’t be worth it to pay high rates for low service. National property managers can have clever ways of solving the local knowledge issue, so you have options.
- Use a national property manager if you own multiple investments. Do you want to deal with many different people, one for each property you own in a different location? Property managers who use the advanced technology available are excellent at managing multiple properties. They can make it feel as effortless as owning one.
- Use a national property manager if you need to save on costs. As local agents usually charge more in management fees, using a national property manager with a lower price is a good option.
The main decision is about selecting a good property manager, rather than whether you have a local or a national one. Put in the work by researching the agency, its processes, and the technology available. You will increase your chances of finding a property manager who will take proper care of your investment property.