Appointing a Real Estate Property Manager?
Why appoint a Real Estate Property Manager to manage your investment?
- Let's list the positives
Your real estate investment is like a car. It's performance is dependant on its driver and unless you have the experience of managing real estate then you can't hope to be a Michael Schumaker at the wheel of your investment. What's more, your associated fees of having your property managed are tax deductable.
A duely appointed professional can be hands on with your property when they have to be. They will promote your property to selected tenants through their own agency signage & window displays, marketing, web site and word of mouth.
They can meet with your prospective tennants face to face and display your property and subsequently vet any application through the Tenancy Information Centre of Australia which screens a prospective tenant. This is only available to members that are real estate agent licence holders and not available to private owners.
Selected possible tenants should complete a written application and attend an interview. Their previous rental history and employment checks will be confirmed, and references obtained and checked. All relevant and legal aspects are taken care of including the prospective tenant's Proof of Identification.
This should secure the best possible qualified tenant as is possible and reduce the risk of making a bad start to any tenancy with a less than ideal tenant.
While there is a cost of engaging a real estate property manager through an agency to manage your property, it proves to be extremly cost effective. Aside from being tax deductable, let's just quickly calculate the alternative of you doing the required work to find a tenant for your property.
Short of placing an ad in the paper, the time, (your time) needed to show your property and then having to process the application, you are still left a long way short (in most cases) of placing a qualified tenant in your property.
And if you do not get a tenant in the first week, you have virtually blown any cost saving that you thought possible and still have an empty property.
Plus you then have to do it all again the nest week and... manage it for the next 12 months for virtually no financial reward!
In short, it can be extremly inefficient and costly to self manage investment property.
My advise is that while it may appear tempting, dont be tempted to self manage.
A Real estate property manager will be hands on to market values and ensure the optimum rent return is maintained for your investment. This will include notificaion to your tenant about rent rises and expiration or renewal of each Tenancy Agreements.
Condition reports and Inspections
Your property will have an up to date comprehensive condition report maintained through regular inspections of your property through any tennancy. This is designed to protect your investment, as they bring minor repairs and maintenance work to early attention thus avoiding possible expensive repairs later.
At the end of any tenancy, a final inspection is carried out which is preferably carried out accompanied by the departing tenants.
The outcome of this inspection will form the basis of the repayment of the Bond, in part or in full.
This, or a new condition report is always witnessed and signed by the in-comming tenant prior to the new tenant's and reviewed on a regular.
A Real Estate Property Manager will also advise you of your obligations and those of the tenant with regard to the maintenance of your property and the Residential Tenancies Act.
Payments and Statements
Payments are automatically and electronically made into your nominated bank account on the last working day of each month.
Itemised statements are forwarded electronically or (by post if preferred) at the time of payments, together with any accounts that have been paid on your behalf and deducted from your rental monies.
Your investment property should carry insurance called
Landlord Property Insurance.
It covers a multitude of risks such as loss of rent from an absconding tenant, malicious damage to your property, cover for theft, loss of access to your property that is neither you or your tenants fault, and Public Liability.
While your buildings will be covered by insurance if controlled by a Body Corporate, you will need to take this insurace out if you have invested in a house, or other investment not controlled by a Body Corporate.
An extra thought here if you hold several mortgages, it would be prudent that you consider taking out Life Cover, Income Protection Insurance etc.
Real Estate Property Manager must and will act within the guidelines of appropriate Acts of Parliament. Such as…
*Auctioneers and Agents Act
*Residential Tenancies Act
*Property law Act
*Rental Bond Act
*Trade Practices Act
*Anti Discrimination act
In summary a Real Estate Property Manager will act on your behalf:
• With professionalism in tenant selection
• Having access to a tenant data bank for selective screening of tenants
• Handling all out goings for the property on time
• In dealing with body corporate matters
• Organising timely minor repairs to a set dollar limit
• Chasing any arrears of rent quickly
• Dealing with tenant concerns
• Dealing with tribunal matters
• Providing end of year financial reports
• Negotiating rent adjustments
• Providing current market information
• Providing individual property recommendations for maintenance or improvements
• Monitoring and banking rent
• Providing monthly rental statements
• Administering Rental Bonds, particularly when vacating or when the tenant wants to break the lease
• Doing property inspections and giving written reports
• Giving recommendations on possible further purchases for your consideration
• Enabling you a hands-free detachment from the investment
To a passive investor with a 9-5 job, this service is invaluable when holding a portfolio of properties. Time, convenience, professionalism and tax effectiveness are benefits. It is simple common sense and more so with interstate property.
PS: If you'd like even more info on property management covering, letting agents, portfolio management, managed letting and landlord insurance plus more than than
take a look at this site
described as being owned and run by a small time property investor, hoping to make it large!
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