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Property managers act as connections between the owner of the property and tenants and ensure the property is maintained.
In many cases, the property manager has the responsibility of attracting tenants to the property. They need to create the accurate rental rate that should be set for your rental property by evaluating the current market. They will also suggest any maintenance and improvements that could increase the rental rate for your home.
Property management will advertise your home to prospective tenants to reach the largest audience of suitable tenants. Of course they screen tenants to ensure they will pay the rent on time and not damage the property.
The property manager can begin the termination process to legally remove the tenant if they do not pay the rent or breach their leases in any way. They file the appropriate paperwork and attend court hearings.
The property manager will set up quarterly periodic inspections and take note of any issues. Of course, it goes both ways, and a property manager should also be looking after the tenants.
It’s no use being reactive when proactive is better, for example, pointing out an issue such as a water leak that the landlord needs to get fixed to prevent damage and more costs.
Landlords can be educated by property managers to be conscious of any problems and particular laws.
Emma Gordon, who runs the property management division in Victoria, says property managers – or at least the good ones – now carry out many more tasks beyond finding you a tenant, collecting the cash and carrying out regular inspections.
“The key is a property manager now needs to be a risk manager, to educate the landlord on how to reduce the risk of being a landlord,” Ms Gordon said.
For starters, there’s building insurance and having to comply with the Residential Tenancy Act, owners’ corporation rules, smoke alarms, changes to notification periods for termination of tenancies and rent increases, the servicing of gas appliances, window safety and pool fencing legislation.
“There are just so many areas now where a property manager has to have knowledge,” she said.
The Real Estate Institute of Australia president Malcolm Gunning says a property manager should help take the emotion out of your investment.
It's more than just finding the right tenant and looking after your investment property. A good property manager should advise on rentals and maybe renovations to help the investor to create wealth.
A major part of the job is acting as a mediator, he says.
An excellent property manager will regularly give you an idea of what your property’s worth (in terms of rental income and if you decide to sell), and will know how satisfied your tenant is.
The best property managers will also help clients create wealth through expert advice. This could be by talking to a landlord about their five or 10-year property plan, by recommending tax depreciation schedules and more.
Property managers should also be monitoring the market and suggesting rental increases as often as the market permits.
