Property Mamagement

Domo,

I’d say a good PM needs to be a skilled negotiator- it isn’t necessarily an easy job, and a PM can cop it from both tenant and owner (owners sometimes treat PM’s as their own little slaves).

I think a good Pm also knows how to treat tenants well. If I had a PM who spoke in a derogatory fashion about tenants, I wouldn’t tolerate it. I have, as a tenant, always known the PM’s of the properties I live in, and expect to be treated decently by them.

Think of your own personal style. Are you hands-on, organised, or even anal? Are you laissez-faire, laid-back, or slack? Let the PM know what you expect from them. If you haven’t told them you want to know immediately if there is some small repair needed, you can’t roar at them if they get it done as a matter of course.

As an owner, I have very little to do with my PM’s. They’re people with a job to do, and I am sure they don’t need me to be calling them up regularly to surveil them.

kay henry

Hi Domo,

I believe that when there are no tenants in your IP the agreement between your and the PM is no longer binding. I have twice ditched PMs for too long a vacancy and had no problems.
If you have to ditch a PM for lousy performance I would ammend the notice to quit the agreement to 1 month.

Hi,

if I could just add to the previous comments — consider selecting an agent in the area where your property is located. Often intending tenants leave their details with an agent in the area they are interesting in renting in.

A good property manager should be able to provide you with information (hard data) regarding time taken to fill rental vacancies. Don’t just take their word for it.[angry2]

Don’t assume that once your property manager is in place, all you have to do is bank a cheque. You really do need to manage the process.

Regards,
Helen [biggrin]

Hi Domo
It would be in your interests to interview more than one PM. They are usually pretty handy at interviews. Might clear things up if you spreadsheet all the items and costs on 3 PMs, see who gets all the ticks.
The agreement should reward renewal of leases with long term tenants, not tenant turnover or tribunal appearances with bad tenants who should have been screened out by the PM in the first place. Avoid paying for ads, a good agency should have enough inbound enquiry every week. Ask for 4 weeks notice on the lease, the PM should know the advantages. Charge market rent, insist on PM finding good tenants, and look after them with fast repairs and maintenance by the PM.
good luck
cheers
thecrest

Hey Domo
You’re doing well. The ideal situation is to have good tenants who stay long term, look after the property, pay on time, and don’t bother your PM on little things, or become demanding. Encourage the PM to get & keep those type of tenants for you.
So, discourage tenant turnover by reducing the profitability of tenant turnover for the PM, by reducing the fees the PM gets when changing tenants, such as fees for :

First let – 1 week’s rent.
re-let – max 1/2 weeks rent, ( limit of one p.a. but $ nil for a re-let during 1 st year )
condition reports ( $ nil )
tribunal appearances ( $ nil )
ads ( $30 max per re-let )
periodic inspections ( $ nil )
annual statements ( $ nil – push of a button ).

Fees charged to you should be :
5%-6% + gst of rent collected, might have to pay 6% for your first property, but 5% for 2 or more.
1/2 of lease preparation, $17, limit one p.a.)
Twice yearly discretionary personal bonus to PM for achievement ( $100 cash each time ) for stability of tenants and low maintenance costs of property.

Remember, the licencee of the REA gets the profit from the rent roll & fees etc,, but, on a day-to-day basis, it’s the PM who chooses your tenants, keeps the maintenance costs down, keeps the tradies honest, collects rent, and takes an interest in your property, and protects your interests.
Be firm, be hard, they do it all day long.
cheers and good luck [biggrin]
thecrest

It’s business, you don’t want a loose casual relationship or any grey areas, so be specific about what you want, have a specific agreement, get the best PM and at fair rates. The most expensive is not necessarily the best.
Reward success afterwards, not just classy sales presentation up front. Keep the carrot until you get the cart where you want it.
cheers
crest133
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