Property Managers… What Value do they add?

Hi Steve

I think we got a certificate, but so what? I don’t believe that you need any qualifications to be a PM – and in fact there are lots of agencies who are not members of the REI, and so therefore would not send their people to the REI courses. It’s a fairly high turnover industry from what I’ve seen

Cheers
Mel

Steve

To actually have an agency of your own DOES require extensive licencing, by agents boards etc. etc. Even for me to hire somebody to manage my own properties I have to look into what is required. I am thinking to approach a licencee, and see if I can use their name, for a % of my ‘takings’, rather than have to go through it all myself.

Cheers
Mel

Hi, Some PM do a good job and some don’t. As an O/s investor I need one. My last PM was a bit slack but a quick phone called to the previous PM same office and everything was sorted out. I think Erika’s idea of playing on the floor with the little one is better, than say handing over an eviction notice to a single mother with 2 kids and one on the way even if she is 6 months behind in rent.

C2

“Is it true the more you owe the more you grow until the bank steps in?”

Simon

Should be in your inbox now.

Cheers
Mel

quote:

---

Hi Michael,

Firstly, I would never waste my time collecting rent, i do believe this is bad use of time for most… but for some it may not.

I do not disagree with your comments and i am sure metropole offer a great service, seems like a great company… My point is that PM’s do need to be paid as much especially when most of the time, specifically with new properties, they don’t really need to do anything… I kind of like the idea of PM’s offering various management plans to their clients… e.g. New apartment plans, Incident based plans etc.

I know many owners of real estate businesses, they all say that a healthy real estate business heavily relies on the number of properties it manages… High profit, annuity revenue… Hence why metropole is seeking this market!!!

What kind of rates do you charge at metropole? Let’s face it the property game is about making money, so other than providing good service how do you ensure that you offer you clients (Landlords) the best possible return… Keeping in mind the massive influx of new apartments in VIC which has directly impacted landlord’s seeking for premium rental returns.

Regards,

Steve

---

Thanks for the questions Steve.

First the disclaimer…. I started Metropole Properties in 1979 and am still intimately involved in that company and property development.
This year we set up Metropole Property Manangement, (MPM), a licenced estate agency. I am not an estate agent and therfore do not work for this company. Pamela my wife is one of the directors of MPM and runs the company.

You are right in saying that many estate agents see the property management business as an “easy cash cow” which supports the office. But they do not look after it like they do the sexy sales department.

MPM has chosen a business model that is becoming more popular overseas. It has chosen not to sell properties, and they exclusively lease and manage residential property. This means they give the same attention to your rental property that the others give to your property for sale. And they cover most of suburban Melbourne with a central “super office”. That’s easy to do today with the internet and electronic banking etc.

It’s hard to beat the big guys in the area of sales, but its easy to beat them in property management with great service.

Each vacant property gets a marketing campaign and special attention given to it to ensure minimal vacancies and maximal rentals.

You asked how they add value – I thought I outlined a number of ways in my previous post. I guess they make your investment hassle free. And with so many properties for lease giving a great number of prospective tenants and huge enquiries from our free interent advertising, they generally lease their landlord’s properties quickly with a huge savings by not having to advertise.

They must be doing something right becuase they picked up 13 properties in the last 2 weeks alone from landlords who were disgruntled with their PM’s.

It’s interesting…those investors that have had a bad experience or lengthy vacancies don’t tend to ask what the fees are. They just want the service. But in response to your question about fees – I believe they vary depending how many properties you offer for management.

Michael Yardney
Metropole Properties
http://www.metropole.com.au

quote:

---

Mel

In fact you do need qualifications to be a PM for other peoples property. The minimum a PM needs is an agent’s representative licence. But they need to work for someone with a full real estate agent’s licence. This does takes much study and a number of years of experience.

You need a trust account which must be audited because you handle other people’s money and professional indemnity insurance.

It’s not as easy as it sounds.

Michael Yardney

---

Michael, I was not suggesting it was easy to go out and run your own agency. In fact I specifically mentioned that you had to work for an agency – and let them have the hassles.

As for the qualifications, obviously each state is different, because I could walk in off the street tomorrow and become a property manager for an agency here.

I also mentioned that to be able to run your agency you had to be licenced etc., and I know it’s a few years study, plus a few years experience – hence my plan to ‘hire’ somebody else’s quals/agency.

Cheers
Mel