self managing

Hi all,

I just purchased my first investment property, a unit in Magill SA

& I was going to have a go at self managing the property.

To others that self manage:

1. what applications forms do you give to prospective tenants to fill out?

&

2. how do you collect rent? by direct debit (if so how)

thank you.
 
Congrats on your purchase.
Most on this forum would strongly advise using a property manager, but if you're really keen to self manage, then why not give it a go.
I manage 8 properties and find that it impacts on my time very little.
You will need an application form for prospective tenants.
Once you select your tenant, you will need a lease agreement and bond form. Both of which are available from the OCBA site
http://www.ocba.sa.gov.au/tenancies/res/forms.html
Here, you will also find other valuable information and details of tenant/landlord obligations.
Rent should always be paid by direct debit. I have all my rents paid on the same day of the fortnight so I only have to check if payments have come through twice a month.
Hope that helps.
 
Congratulations Roxy,

I would recommend you go to a few agents and ask for an application form. Have alook at theirs and take the time to create your own. If you spend the time to qualify your tenants (ring their references - esp rental refs) it will save you a lot of trouble down the track. Some bad tenants are attracted to private rentals because often landlords done take the time to check refs at the beginning and they don't do regular inspections.

If you are going to insist on direct debit (recommended), go to your bank and ask for a form. Your bank will debit their account. Include this with the lease and have the tenants sign this at the same time.
Hope this helps.
 
We have had no problems getting landlord insurance as a self-manager, though some companies will not come to the party.

From memory, we have used QBE, Westpac and I think we now are with Suncorp.
 
I had no problems getting insurance - the condition was there had to be a lease in place, not a PM. So renting to your mates under the table with no lease is a no-no, in case you didn't work that one out on your own :D
 
Anecdotally, pretty much every horror tenant story I’ve ever seen has been related to self managed properties (have a trawl through the ones on this forum alone and you'll see the pattern). IMHO, find a good PM, drive a hard but fair bargain on their costs and pay for them with pre-tax income. The net cost may be very little indeed.
 
Anecdotally, pretty much every horror tenant story I’ve ever seen has been related to self managed properties (have a trawl through the ones on this forum alone and you'll see the pattern). IMHO, find a good PM, drive a hard but fair bargain on their costs and pay for them with pre-tax income. The net cost may be very little indeed.

I would have to argue that there are plenty of horror stories on this forum about properties that are "professionally" managed. I would HATE to be paying a PM and have some of the poor service and issues that I have read about on here.

Maybe we are reading different stories.
 
I'd have to agree with wylie....we had the tenants from hell managed by the manager from hell....

Never looked back since self managing and only takes up minimal time as Rob confirms....but you must know what you are doing and know everything about the game you are in.

There are many many stories that don't stack up for me to go with an agent....they are a rare thing a good managing agent and I don't have time to find one and manage them as well. Just the way I see it from experiences to date.
 
But agents are sooooo expensive and I'd rather not hand over half my net rent to them! If they trash the house, well, that's what insurance is for ... also pretty impossible to devalue my place. Its worth much the same as a gutted wreck and a gold plated overcapitalised boudoir.

Last few places I rented were managed. Last agent had this habit of inspecting the WRONG UNIT, gave me the keys with the previous tenant still in there for the first few days of my lease, never responded to maintainence requests let alone ever returning phone calls. Agent out here let my current tenants get so far in arrears it wasn't funny. Another agent was so irritating (house was for sale and I'd get maybe 30 seconds warning a party of 10 people were about to come through for an open - multiple times a week) it was easier to just stop paying rent and start looking for a new place than put up with the crap. Best rentals I've ever lived in have been self-managed.

But overall its the sheer expense that puts me off them. Especially since our next IP (if we don't sell it) will be about 6m from our house, it'll be pretty easy to keep an eye on.
 
I would have to argue that there are plenty of horror stories on this forum about properties that are "professionally" managed.

Is that not a contradiction in terms?! :) Judging by your quotes I think we're on the same page here so the caveat is obviously that my sentiments include having a professional PM of which there are many around.
 
Is that not a contradiction in terms?! :) Judging by your quotes I think we're on the same page here so the caveat is obviously that my sentiments include having a professional PM of which there are many around.

I don't think it is a contradiction :confused:

There are plenty of stories on here where tenants are bad even with professional management.
 
For myself the test was: if the tenant was getting behind in their rent and you show up to the following: crying woman with 2 week old baby whose partner has just walked out and she has no money: can you do the required actions to evict her? Me ? I am a hopeless softie so I have a PM who is hard as nails ( we have a tenant with 3 kids due for eviction the day after Easter).

But I know that plenty of people are easily able to separate the business/ personal thing and I am sure they have no problem managing. I just know myself well enough to say I wouldn't be any good.
 
Show me a PM at less than 10% PA and I'm there :)

Sadly, they don't exist in these parts.

Sounds like something specific to your area. Across quite a number of PMs in Sydney and the Gold Coast I pay between 5% and 6% plus GST, a week’s rent to find a new tenant and then some minor incidentals. Most of these I’ve had for many years and they’ve been excellent bar one exception which was swiftly ousted when they dropped the ball. At the end of the day, I’m paying somewhere around $600 or $700 net PM fees annually on an average apartment which in my view, is money very well spent. Work that out at an hourly rate (remember this includes finding new tenants) and it’s a pittance. I’d much rather use the time to get on with the next deal rather than deal with activities which can be cheaply outsourced to professionals.

I don't think it is a contradiction :confused:

There are plenty of stories on here where tenants are bad even with professional management.

Saying "horror story" and "professionally managed" together is the contradiction. Professional managers shouldn't let a situation deteriorate to that point and if they do, I suggest they’re not professional.
 
I am a hopeless softie so I have a PM who is hard as nails ( we have a tenant with 3 kids due for eviction the day after Easter).

This is a very relevant point; not having to look the tenant in the eye or talk to them directly when you’re raising the rent or booting them out has its advantages. These activities become pure business transactions. This might not be a problem for some people anyway, but certainly there are advantages in being one degree removed.
 
Even though I have completed my certificate in Property Management a few years ago (through REISA only 8 week course 1 night a week I think), we decided to go with a PM as our overall game plan is to build up our property portfolio that runs smoothly WITHOUT our involvement ie build up a business then build yourself OUT of the day to day management to work the bigger picture.

We might consider self-manage in the future if (or when!) we can cut our day job hours back.
 
Hi Roxy,
good on you for thinking about self-managing! It took me a few years of using property managers before I was ready to make that step. The main thing I have learnt that it is so much easier to self-manage a property which I have renovated myself. I have a house in the Western suburbs in Sydney where the only interaction I have had with the tenants in 18 months is because the neighbour wants to replace the fence. No repairs, late rent, etc. That sort of property and tenants is easy to self-manage.
On the other hand, a property of mine in rural SA (which I didn't renovate) causes nothing but hassles almost on a weekly basis. With that property, I am thinking about getting a property manager again.
Regardless of whether it's renovated or not, the key things to look out for are having proper insurance, getting quality tenants by advertising through the most effective medium and thorough background checks.
I terms of getting good tenants, I have recently been using a newish service landlordschoice.com.au to advertise on realestate.com.au and also to do background checks and get some of the recent legal documents. Sorry for bringing them up again, but I really think it is a good offering for self-manging landlords like us.
 
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