Thanks for your thoughts meakinmaster60, you guys offer great help!
I will remember to keep a cool head regarding PMs.
The buyer agent was fantastic. Very smooth transition from dream to reality and they were always available for queries. I would recommend them to anyone interested in using one. I also used a fantastic mortgage broker. The only point where I hit a snag was with the settlement agent & bank. Countless losing of documents by bank and settlement agent late with payments to everyone! Next time I will use a bank for settlement because they are much cheaper than Settlement agents.
Reno’s completed yesterday, looks great, and should now be able to get $220/week instead of $180 when it was in original condition. Still a big gap between rent and mortgage, but perhaps we can find something with a smaller ratio next time. At least our foot is in the door and hopefully in 20 years time the negative gearing on the property wont be an issue.

Can anyone confirm that if you let the REA arrange everything from carpet cleaning to key cutting (billed to your monthly account), you can still claim it back as a tax deduction easily?
Also, we are negatively geared and the property is in both of our names (with my mum as garaunteer), but I’m not earning a wage. I spoke to an accountant who explained that come tax time, half of the loss needs to be debited from my wage which doesn’t exist. Does anyone know how to get the mortgage in my husband’s name? Would it be after we build enough equity, refinance and get mum out of the picture? [stun]

I emailed agents in the local area via realestate.com.au last night and this is what one of them has sent through:

FEES CHARGED
INCLUSIVE OF GST
Schedule of Fees
Property Management

Management Fees – 9.35% of the gross collection for unfurnished
11.00% of the gross collection for furnished
17.25% of the gross collection for holiday accommodation

Property Condition Report – $93.50 for properties exceeding 2 bedrooms
$66.00 for properties not exceeding 2 bedroom

Routine Inspections – $44.00 per quarterly or $60.50 per half yearly

Bond or Final Inspections – Free of charge

Inventory (Furnished only) – $44.00

Leasing Fee – 6 mth lease is two weeks rent + GST, less one week paid by tenant

12-mth leases is three weeks rent + GST less one week paid by tenant

Note this is charged every time a new tenant goes in

Advertising – $15.00 per article in newspapers.
Rent list, Internet, window all free of charge

Attending Court on – Free of charge
Behalf of Landlord

Postage & Petties – $5.50 per month for one property
$2.75 per month for each additional property

Maintenance – $5.50 – organizes & finalize

Insurance Claims – $27.50 – every claim that we do on behalf of you

Title Search – $16.50 (waived if copy of title provided)

This one states that they don’t do flat fees because it usually ends up being more expensive for the landlord. Another states they will do a flat fee of 14.9% but it will only include management fees, postage & petties and routine inspections. Looks like I’m going to have to brush up on my math and convert charges to a percentage and work out if I’m being ripped off or not. Thanks for the advice so far

Interesting points of view! We bought the place through a buyer agent, due to the Perth Market being so heated, our lack of experience and feeling overwhelmed. They inlcuded a property managers details in the report in which a draft contract was included. I know that we don’t need to feel obligated to choose them,but it goes like this:
Management fee – 8.8% of annual gross collections/annum
Property condition report @ commencement of each tenancy – $99.00
Final Bond inspection @ termination of each tenancy – $88.00
Routine inspection reports – $49.50 (every 3 months)
Postage/petties etc – $9.90/month
Advertising up to $220.00
Fixed management fee – N/A

Like Terryw, I don’t want to be directly involved with tenants because I know my limitations and I am likely to be taken in by sob stories. To avoid that senario and until I develop more business savy, I feel more comfortable with a middle man.