In my experience, many property managers have no idea what they are doing. My parent paid a lot of money to a clueless property manager who: never reviewed the rent and let it get to $150 less than market value; allowed the tenant to fall more than 2 months in arrears; and hit my parents up for 'structural repairs' where there were no structural issues with the property. It took all that for them to ask for a new property manager.
I won't go on with heaps more examples because I am sure there are many fine property managers. I just don't have direct experience with them. I do agree there are some self-managers who are equally clueless, however I also know many who are excellent self-managers. The primary reason I self manage is that I want to respond to issues very quickly. For example, I get any urgent issues rectified by close of business the same day. I don't find that with many property managers, by the time the tenant has managed to get hold of the PM and the PM has contacted the owner, it is usually a minimum of the next day.
Each to their own though. It's your choice as to how you want to spend your time and money.
It is my experience that many of the members of this forum are more in tune with all 'stuff' property related than the vast majority of property investors, who mostly have only one IP. Don't get me wrong, one IP is better than no IP's, but most people seem to be complete novices where their properties are concerned.
I have noticed that there are a lot more self managers in WA than in most other States. This is probably due to the huge fees that WA PM's seem to charge.
I think that most of the experienced investors here, would take their PM to task with the kind of behaviour you have identified with your parent's PM, however the owner of the property needs to take some responsibility as well. For instance, in allowing the rent to stay so far behind market. Although I trust my PM's implicitly, I routinely check what the going rate is for properties in the area that mine are located in, and I'm quick on the phone if I feel that my rents are slipping behind. So, with that example, the blame goes two ways.
For instance.....I have a relative who has an IP located near to where I live. The Agency that looks after it aren't a bad one. They have just had their tenant move out. Although they've owned this property for something like 12 years, this is only the second tenant they've had. They mentioned that the tenant was a very good tenant on several occasions, so they didn't want to put the rent up.
So, we pop over to the IP, as they are doing some work before the next tenant goes in. OMG!! Good tenant? You've got to be kidding! The yard is a jungle, and we saw how it was prior to this tenant going in. It was immaculate! They are updating the bathroom, painting & possibly putting in a new kitchen. Anyway, we talk about house values & rents, and we're told that the rent will probably be around $360pw, which is a large jump from the last tenant.
A quick check of Real Estate.com.au tells me that a house identical to theirs is currently for rent for $400pw. The market isn't slow, so there's no need to drop rents. They just don't want to charge too much, so the poor tenant can afford the rent, and their PM does what they are instructed to do by the owners.
