Are PM's worth it?

[Chilli]

For our first 2 IPs we bought within 10K of our home and managed them ourselves. At that time a few extra dollars could make some difference to us, it was also a very worthwhile learning experience in our opinion (we are control freeks and hands on people). We did not have any outstanding tenants but not any real bad ones either.

I believe there are tenants who are "bad by nature" and in some cases are bad partly in responding to PM or landlord lacking problem solving/negotiating/interpersonal etc skills. If you handled the renting yourselves and just about all your tenants were bad ones chances are you might be part of the problem......

Our son also handled his first 2 IPs (and got some exp out of the process) but he is now outsourcing to PM as he thinks his time is more valuable doing other things, even if it means some time off to enjoy life, it is still wll worth it in his view.

In short I am with Rix , no right or wrong way just what suits you and your circumstances at the time.

 

[Rixter]

I'm not trying to state anything. What I wrote on the particular subject is very clear and unambiguous, and I stand by it 100%.

Now there's a contradictual oxymoron statement if ever there was one.

That alone is enough to confuse everyone to take a deep breathe and sit down for a rest . Have a great Day

 

[vandalic]

Exactly Rick and Salsa, you've both hit the nail on the head perfectly.

 

[gooram]

I've come in late on this thread and I must admit I'm leaning towards Dazzlings position here.

I currently manage 2 IPs myself, and at present this is the only way to fly, if you spend time, first of all picking the right tenant, then getting to know your tenant and developing a relationship, it works wonders for an ongoing mutually happy and trouble free arrangement.
The thought of paying a PM do do nothing for

95%

of their money, really makes the choice to manage a no-brainer.

Lizzie could you elaborate on the 5% you talk about... what sort of problems does your agent solve?

I must admit, I've only been in the managing game for 3 years, and the only problem I've had is a missing tenant (turned out they got sick and returned home - long story short, tracked them down and they were happy to pay the outstanding rent). This involved all of a few phone calls.

I think perhaps if I was in another country a PM might be warranted.

I don't see what situation a PM would be helpful, even when problems arise, what do they actually do? (this is not a rhetorical question)
If you end up having to go to court to recoup money, do an RE agent attend for you and pay the bills?
I honestly don't mean to be sarcastic, I guess I'm still a little wet behind the ears.

Peace!

 

[geoffw]

I don't see what situation a PM would be helpful, even when problems arise, what do they actually do? (this is not a rhetorical question)
If you end up having to go to court to recoup money, do an RE agent attend for you and pay the bills?
I honestly don't mean to be sarcastic, I guess I'm still a little wet behind the ears.

I have a block of 9 1BR units, 7 of which are furnished. Although I self manage another property with 3 cottages, I'm happy for the PM to look after the flock of bats.

She has been to the tribunal on my behalf, several times. That in itself was worth its weight in gold- I had a lot of work at the time, and I was not able to afford the time off. She deals with a lot of minor things- leaking toilets, DVD player not working, microwave broken. She's visited the tenant on many occasions, tried to see if it was a tenant problem- when the problem has been an equipment one, she's got quotes from 3 different sources, bought the item after my approval, and set it up for the tenant.

After a tenant was being evicted, when he came to collect his goods from storage, the PM stayed around for a number of hours to ensure stuff was removed properly.

 

[kathryn d]

hi Geoff
Just read your thread about offering tenants who pay on timea "free week" at Xmas. Did you do that and if so, how well did it work?

Other ideas I have heard is
1. ballot for every month paid on time to go for a draw for a free trip (your choice of destination)

2. Coins for the laundry (paid washer/ dryer) if rent paid on time

 

[Monopoly]

offering tenants who pay on timea "free week" at Xmas. Did you do that and if so, how well did it work?

This is a standard feature of renting one of my properties (regardless whether rent is paid on time or not) and my PMs know that I insist on the "free week" to families in my homes as I want them to have a "little extra for shopping" come Xmas time (especially if they have kiddies).

Other ideas I have heard is
1. ballot for every month paid on time to go for a draw for a free trip (your choice of destination)

Wow!! Rome?? Paris ?? London?? Hmmmm...methinks this could be a very expensive way of ensuring you get your rent money paid on time!!

 

[kathryn d]

Wow!! Rome?? Paris ?? London?? Hmmmm...methinks this could be a very expensive way of ensuring you get your rent money paid on time!!

Cancun or Cuba would be a cheap trip to offer here for us. Have thought about it, but really, should landlords really have to offer incentives to be rightfully paid on time?

 

[Monopoly]

but really, should landlords really have to offer incentives to be rightfully paid on time?

IMO....No!! But then, that is MY opinion only, and I know that there are many landlords/ladies who would beg to differ on that note!!. In fact, they have done so in several (tenant) "rewards" type of discussion threads on this and other property forums.

I personally don't believe "incentives" should be part of (good/effective) property management. Some may argue that my offering a "free week" at Xmas IS an incentive, but as it is NOT a condition of prompt rental payment I don't see it as such!! Rather, it is one way of spreading a little Xmas spirit, which serves to keep those that keep me in the lifestyle I enjoy, HAPPY!!

 

[goddessk]

IMO....No!! But then, that is MY opinion only, and I know that there are many landlords/ladies who would beg to differ on that note!!. In fact, they have done so in several (tenant) "rewards" type of discussion threads on this and other property forums.

I personally don't believe "incentives" should be part of (good/effective) property management. Some may argue that my offering a "free week" at Xmas IS an incentive, but as it is NOT a condition of prompt rental payment I don't see it as such!! Rather, it is one way of spreading a little Xmas spirit, which serves to keep those that keep me in the lifestyle I enjoy, HAPPY!!

If I think of how we operate in the corporate company that I work for, we have an annual rating scheme. The rating a person gets each year determines their bonus and what pay increase they receive. It really separates out those who are doing their job and those who are going over and above and deserve that little bit more reward.

The way that others have written about the tenant as doing the landlord a favour does ring true. Without the tenant we have no funds coming in and whilst we can think that we are providing them with a roof over their head, they are also responsible for paying our bills and keeping our property in good condition. I don't think that incentives/rewards are necessary but I like the idea of them. But it doesn't have to be in the form of cash, although that is the greatest motivator.

When my tenant first moved in I sent them a letter to say welcome and hope you will be happy living in the house. It may do nothing to the tenant but then again it might make them realise that there is a human being behind the property that genuinely wants them to be happy in the home.

If she pays the rent on time for 6 months I will send her a voucher or something. She is a single mum with four children so she might need the assistance and appreciate it. I am not advertising that I will do it so technically it's not an incentive but a way to say thanks for looking after my property.

 

[geoffw]

hi Geoff
Just read your thread about offering tenants who pay on timea "free week" at Xmas. Did you do that and if so, how well did it work?

It didn't work well. I was aiming especially at two tenants who were not paying on time, and I had hoped that this would be a good incentiveto them. But those tenants still got late; the people who got the bonus were the ones who were paying on time anyway (though by nature of a fully furnished let, it has a higher turnover, and a number of tenants were't there long enough to collect a bonus).

The two people who were habitually late both ended up being evicted.

 

[Monopoly]

If I think of how we operate in the corporate company that I work for, we have an annual rating scheme. The rating a person gets each year determines their bonus and what pay increase they receive. It really separates out those who are doing their job and those who are going over and above and deserve that little bit more reward.

How does this system (which btw is an admirable one in an employer-employee world) work in a tenancy situation?? Should those who pay "early" be rewarded more than those who pay "on time" and/or should those who pay "late" get zippo?? How do you measure "over and beyond" in tenancy terms?? And even so, how would it be a fair system?? After all, late is late, be it by a few days or a few weeks right??

When my tenant first moved in I sent them a letter to say welcome and hope you will be happy living in the house. It may do nothing to the tenant but then again it might make them realise that there is a human being behind the property that genuinely wants them to be happy in the home.

Very sweet, but does it mean they will take greater care of your property, or show greater loyality by staying longer simply because their landllady has blood running through her veins?? But hey, who knows it just might; then again, it is just as likely to mean that if they fall on hard times they can always pull out the emotional trump card and play on that good nature of yours. My advice FWIW, tread carefully, one sour experience with tenant ingratitude/backlash will change your mind faster than you can spell tenancy tribunal, and believe me if that doesn't kill off any "warm and fuzzies" towards future tenants, I don't know what will!!! IMO emotion has absolutely NO place in real estate; not when you buy, not when you sell and most definitely NOT when you self manage!!

If she pays the rent on time for 6 months I will send her a voucher or something. She is a single mum with four children so she might need the assistance and appreciate it. I am not advertising that I will do it so technically it's not an incentive but a way to say thanks for looking after my property.

And if she doesn't pay on time for 6 months, do you still send her a voucher or something?? Hmmm....sounds, smells, looks like an "incentive" to me!! Oh hang on, I get it....derrrr...."advertising" or broadcasting it TO the tenant spells that it is an "incentive" but if they are ignorant of the (behind the scenes) "conditions" placed on them spells it's not. Oh puleeeeeeease .....are you doing it for your tenant, or for yourself?? What happens when she does not pay on time, and you do not "reward" her, don't you think she will wonder "what the...??" Don't you think she will figure it out sooner or later??

I give ALL my tenants, yes even those without the "kiddies" a week's free rent every Easter, and especially at Xmas, not because they pay on time, because I do so even for those who are persistently late!!! Maybe it's a psychological thing, but I have never been able to sit down at the dinner table at Easter or Xmas and enjoy my meal if I thought my tenants weren't going to be able to do the same thing simply because their tight-ass landlady didn't let them off one measly week's rent!! And really 2 lousy weeks out of every year doesn't really hurt too much on a passive income in excess of 100K+.

 

[Les]

G'day Mono,

IMO emotion has absolutely NO place in real estate

hehe - except when it does.....

I have never been able to sit down at the dinner table at Easter or Xmas and enjoy my meal if I thought my tenants weren't going to be able to do the same thing

Well, I say "Good on you, Mono" - seems like you're yet another landlord with red blood flowing through your veins.

Am I quoting out of context? Perhaps, but I reckon you're BOTH right (you and goddessk) - seems you're more "in step" with each other than "out of step",

Regards,

 

[goddessk]

How does this system (which btw is an admirable one in an employer-employee world) work in a tenancy situation?? Should those who pay "early" be rewarded more than those who pay "on time" and/or should those who pay "late" get zippo?? How do you measure "over and beyond" in tenancy terms?? And even so, how would it be a fair system?? After all, late is late, be it by a few days or a few weeks right??

Very sweet, but does it mean they will take greater care of your property, or show greater loyality by staying longer simply because their landllady has blood running through her veins?? But hey, who knows it just might; then again, it is just as likely to mean that if they fall on hard times they can always pull out the emotional trump card and play on that good nature of yours. My advice FWIW, tread carefully, one sour experience with tenant ingratitude/backlash will change your mind faster than you can spell tenancy tribunal, and believe me if that doesn't kill off any "warm and fuzzies" towards future tenants, I don't know what will!!! IMO emotion has absolutely NO place in real estate; not when you buy, not when you sell and most definitely NOT when you self manage!!

And if she doesn't pay on time for 6 months, do you still send her a voucher or something?? Hmmm....sounds, smells, looks like an "incentive" to me!! Oh hang on, I get it....derrrr...."advertising" or broadcasting it TO the tenant spells that it is an "incentive" but if they are ignorant of the (behind the scenes) "conditions" placed on them spells it's not. Oh puleeeeeeease .....are you doing it for your tenant, or for yourself?? What happens when she does not pay on time, and you do not "reward" her, don't you think she will wonder "what the...??" Don't you think she will figure it out sooner or later??

I give ALL my tenants, yes even those without the "kiddies" a week's free rent every Easter, and especially at Xmas, not because they pay on time, because I do so even for those who are persistently late!!! Maybe it's a psychological thing, but I have never been able to sit down at the dinner table at Easter or Xmas and enjoy my meal if I thought my tenants weren't going to be able to do the same thing simply because their tight-ass landlady didn't let them off one measly week's rent!! And really 2 lousy weeks out of every year doesn't really hurt too much on a passive income in excess of 100K+.

Each to their own Monopoly. If your strategy works, good luck to you. I'll stick to my own thanks. Even with emotion.

 

[Monopoly]

Well, I say "Good on you, Mono" - seems like you're yet another landlord with red blood flowing through your veins.

Am I quoting out of context? Perhaps, but I reckon you're BOTH right (you and goddessk) - seems you're more "in step" with each other than "out of step",

Regards,

Nahhh Les.....LOL...okay, there may be blood running through my veins, but I've been put through so much crap because of ingrates that it has turned my blood cold, maybe not quite to freezing point, but damn close!!!

As for Goddesk, her heart is in the right place, I just hope her tenants don't take advantage. It's always hard when you try to do the right thing only to have them turn on you.


.

 

[Monopoly]

Each to their own Monopoly. If your strategy works, good luck to you. I'll stick to my own thanks. Even with emotion.

Fair enough Goddesk, and all the best to you.

 

[goddessk]

Fair enough Goddesk, and all the best to you.

Thanks Monopoly. And I know things may turn sour and I'll deal with it when or if it happens. I just can't stop being the person I am and that includes being emotive. I like to think the best of people. I know that can be naive sometimes but my nature is to give people the benefit of the doubt. There is plenty of time for me to become bitter and twisted I'm sure....but not just yet.

 

[Monopoly]

Thanks Monopoly. And I know things may turn sour and I'll deal with it when or if it happens. I just can't stop being the person I am and that includes being emotive. I like to think the best of people. I know that can be naive sometimes but my nature is to give people the benefit of the doubt. There is plenty of time for me to become bitter and twisted I'm sure....but not just yet.

Steady on girl, I'm advocating caution, not retreat!!! I'm not saying you should STOP being yourself, nor did I say that because tenants CAN (and btw not ALL of them do) turn on you, it will make you "bitter and twisted"!! Hell, if it ever gets that bad (save yourself and) get out of the game.

I may be skeptical of tenants good intentions (to do the right thing by me if I do likewise) but I am neither "bitter" nor "twisted" as a result of the bad experiences; "jaded" maybe (especially after having my very first IP torched to the ground when I was just 19).

But hey, sh** happens right??

All the best.

Jo

 

[kaf]

Hi

Been reading this thread with interest as I’m wondering if I should do my own property management. Only issue I have is: how do you advertise your property? As far as I understand I can’t advertise on realestate.com and a lot of tenants find rentals by walking the real estate shop strips in the suburbs. Do you self-manage guys just find your tenants through ads in the paper?

Cheers

kaf

 

[lizzie]

i "give" to my tenants by ensuring any problems are fixed promptly and that they are happy with their environs - and not bothering them. surprising how many landlords to not give this to their tenants.

i do send my pm, conveyancer and broker all a very nice bottle of wine and chocolates for christmas tho. they are more than worth it.