Property manager for a joint ownership home?

[albanga]

Hey All,

This may sound quite odd but just hear me out

My brother and I own a joint property 50/50. I live in the property as my PPOR with my wife and my brother moved out about 1 year ago. For the past year I have been paying him rent. Now as per another post (http://somersoft.com/forums/showthread.php?t=101989) this has not been done very well.

Moving forward I want to continue to live in the property and my brother is keen to hold it as an IP but wants to ensure it is done correctly so he can make the appropriate tax claims. I know a formal written agreement is probably a good start as opposed to a handshake but what about getting a property manager? They would not need to do any inspections but all rent, maintenance, rates.etc could go through the property manager for his half of the property. He would also pay for the property manager but could claim some of this as well?

My brother just wants to manage this as efficient as possible and at years end he is handed the paperwork from the property manager to take to the accountant.

Please go easy on me if this seems like a ludicrous thought!

 

[Terry_w]

Why would you want a property manager? Waste of money in my opinion.

 

[Jamie M]

Is your brother not too organised? It shouldn't be too difficult to get an end of year statement for your interest and also work out how much rent you've paid during the year (I assume it's done electronically and consistently - I haven't read your other post).

Seems like easy money for a PM - and quite an unusual situation.

Requesting maintenance via the PM will probably just confuse matters IMO - but I guess it depends on your relationship with your brother.

To me it sounds like an unnecessary middle man.

Cheers

Jamie

 

[albanga]

Thanks for the reply gentleman.
I do agree it sounds like an unnecessary middle man and a waste of money but It's always good to get that feedback from the experts.

My brother and I have a fantastic relationship so it will not be difficult coming to an agreement that we can get the best outcome for the both of us without needing to complicate it with a property manager.

 

[Sez]

I've managed a few of these in the past. Typically I've charged a lower management as all I do is collect and disburse rent with some accounts coming out of the trust fund as well and then generate statements and EOFY statements. If it is what works for you just try to find a PM who would be happy to take it on and work with you .

On the other hand, consumer affairs VIC has all the resources you will need to set up a lease agreement etc. in writing. Just get him to check with the accountant as to which they think will be better as well and you're all set to go .

 

[Terry_w]

I actually have a client who leases his brothers unit and the brother leases his unit and they go through a real estate agent.

 

[redwing]

Why would you want a property manager? Waste of money in my opinion.

Trying to provide a paper trail for the ATO as not too confident of strategy?

I actually have a client who leases his brothers unit and the brother leases his unit and they go through a real estate agent.

A better option

 

[Lil Skater]

Jump on consumer affairs, they have all the forms you need to make the agreement "formal".

He could just start up an excel sheet to record your rent coming in; and payments going out. Simples!

 

[Perp]

Bear in mind that the most important factor is to ensure that you're paying market rent. If you're paying below market rent, it can compromise his tax deductibility. So make sure you document how you came up with the rental figure, e.g. print off comparable properties for rent in the suburb and keep it, showing how you set the rent.