Originally posted by Gordon Gekko
Hi All,
About to sign up a Property Manager for my first IP.
Any hints?
They are charging 7% management fees. Is that "standard"?
The IP is in a Melbourne northern suburb.
Thanks
GG
Congratulations on your first investment. Lets hope its the beginning of a great portfolio.
A good PM will be critical to the performance of your investment. I'm going to offer some generic advice and then a specific suggestion.
To chose a good property manager you need to ask the right questions. here are some to consider:-
1.Does the agency have a dedicated rental department and how many staff will be looking after your property?
Many agencies see property management as a “poor sister” to the more glamorous sales department and some even leave the management of client’s assets to the front desk staff and receptionists. Ensure that your agent has a dedicated property management department. It would be preferable that this department is staffed by a number of experts so that there is continuity of management in the event of one property manager being ill or leaving.
2.Is a director / owner of the agency involved in the day to day management of the property management department?
Most agencies have a sales department and a rental department. Generally speaking the business owner has a sales background and not a rental background and looks after the sales department and leaves the management of their rental department to a property manager.
This is because the sales department has a higher turnover and high income and the rental department has a lower income and is more intensive and difficult to manage.
3.How many years has the property manager looking after your property been working in real estate?
Note that I said property manager and not the agency! Don't go to an agency just because they have a brand name.... it doesn't mean their service is going to be any better.
Many people start their career in real estate as receptionists and then move up to the property management department and some of the top performers move into sales. Yet some individuals chose property management as a career – this is the type of person that should be looking after your property and they should preferably have had 4 years industry experience.
4.How many years has the property manager been with the agency?
You should look for stability in your property mamanger. You want someone who will learn your property inside and out. You want to pick up the phone and talk to that person today, and in six months time you want to be able to talk to that same person. Due to the stresses involved in property management the staff turnover tends to be quite high. This is another reason why you should look for an estate agent who has chosen property management as a career.
5.Does the property manager give you a written proposal?
Some property managers just go out and look at your property and say “OK we'll put it on our books”
Look for someone who has put in the time and effort to present a professional image to you and give you a written proposal. If they make the effort to present their services professionally to you it is likely they will look after your property professionally also.
6. Does the Property Manager just hands out keys or do they attend property inspections with prospective tenants.
If they just hand out he keys and let the tenant inspect the property on their own, move on to another agency. I’ve seen to many things go wrong with this approach, including one extreme case where a prospective tenant made a copy of the key and returned the key to the agent, got back his driver’s licence or whatever he gave for security and then used the copy key that he made to move in and squat in the premises without paying rent! It took weeks to get him out.
Also walking around the property with prospective tenant’s means that the agent has a chance to promote the property as well as an opportunity get to know the tenant a little better. It is amazing what will come up in general chat that would never be written on an application form!
7. How many properties the manager looks after?
If a property manager looks after too many properties they won’t have time to devote the attention your property deserves. Many busy agencies have up to 200 properties per property manager and in general this is far too many to give your property individual attention. At some boutique agencies each property manager looks after about 100 properties. While these agencies may charge a little more for their property management services landlords find this extra expense translates to a trouble free investment that often produces a higher return.
Can I suggest you contact my wife Pam at Metropole Property Management on 9532 8889 because you deserve a property manager who cares as much about your property as you do! She has a great team of proeprty mangers one specialising in Northern suburbs, and as property investors they understand your needs and will look after your property the way they look after mine.
And you get a money back guarantee on the level of service.
Even if you don't call have a look at their web site
http://www.metropole.com.au/html/metropole_property_management.htm
to get an idea of the sort of services you should be looking for.
