Questions to Ask a New Property Manager
Congratulations, you’ve just purchased your first investment property. Now comes the fun part; research. Selecting the right property manager is a big decision, this is someone who will be taking care of one of your most expensive assets. Not only are you looking for someone who is professional, and knows what they are doing, you are looking for someone who you will be comfortable dealing with.
Once you have come up with a shortlist of potential property managers, how do you make that final decision?
One good option is to go to an open inspection of the property manager you’re considering hiring. Are they on time? Do they put in effort with prospective tenants, or are they obviously dismissive? And does it feel like they want to be elsewhere? Your first impression here is important, as that will be the first impression your manager will be giving potential tenants as well.
Another is the rental appraisal. This is when you invite the prospective property manager to see your investment property, to discuss the renting process, how much rent you could be receiving and discuss the property managers’ services.
Questions to ask:
What will I be charged?
This may seem like an unnecessary question because a property manager will always let you know their management fee. However, unlike the fees associated with selling a property, there can be several ongoing fees that a property manager won’t include in their initial quote.
Two additional upfront fees you will likely incur are:
- A Letting fee (often one or two weeks’ rent)
- An Administration fee (usually a monthly fee for administration)
Make sure that you have the property manager detail all possible costs and fees, and indicate whether these fees include GST. Remember that these fees are often negotiable.
What can you do that another property manager can’t?
Simply, what sets them apart from their competition? Property management is not just about collecting the rent: it is a comprehensive management service which should be provided by a trained property manager.
Are you the property manager who’ll be looking after my property? And if not, who will be?
When you meet with a prospective property manager, you want to make sure that you know exactly who will be looking after your property. If someone else will be looking after the property, arrange to meet with, or learn more about, that person prior to committing to the agency.
How long are your properties typically vacant?
The average vacancy time after a property is ready should be about 2-4 weeks. Any longer than this suggests the property manager is struggling to find tenants, any shorter than this suggests that your asking rent amount is too low and you might be leaving money on the table.
What control do I have over the tenant lease agreement?
Your property manager should give you some input into the lease agreement, especially if there are one or two issues that are important to you. Make sure your prospective property manager is confident in the leases that they have written for tenants by asking this question.
Not only are the answers to these questions important, but the way that they are answered can tell you a lot about the property manager. Take notice of the whole meeting;
- Was the property manager on time for the meeting?
- Are they able to answer your questions well, have they been able to explain themselves?
- Do they appear to have a good working knowledge of the processes and the necessary legislation?
- Are they listening to your questions and concerns or trying to lead the conversation to what they want to talk about?
- Do you feel that this person is someone who you can raise concerns with comfortably?
- Is this someone who you believe will be able to fix any issues that arise
- Is it someone who will be able to prioritise what is important to you?
Do your research, be critical and informed, and go with your gut. Remember that the successful property manager will be looking after one of your most valuable assets, make sure you choose carefully.