What is a property manager?
A property manager is an individual or a business that is responsible for the management of a rental property and the landlord’s day-to-day responsibilities. Hiring a property manager for your investment property is a simple and effective way to manage your property, which can alleviate stress and provide more free time for yourself.
What do they do?
Some of the primary responsibilities of a property manager include:
Conducting regular inspections of the property, and providing you with a detailed report of its current condition
Using various real estate websites to advertise your home when looking for tenants
Coordinating rent collection, bills and other required payments on your behalf
Creating and finalising reports on entry conditions
Taking care of completing any paperwork or documentation
Managing tenant turnover
Providing professional tradesmen to complete repair and maintenance requests
Being a first point of contact for any questions and issues from the tenant
How much do they cost?
Property management fees are categorised into three groups:
Management fees: Daily management fees for the property
Letting fees: Fees for locating new tenants
Other fees: These costs include renewal feels, tribunal representation fees, statement fees and more.
In the current Australian market, the average management fees for all states are 7.5% of your weekly rental income. Therefore, a property with a larger rental income will have a larger management fee.
Pros and cons of utilising a property manager
There are many benefits to using a property manager to manage your investment property. These include:
They have extensive experience in the industry, and can act in your best interests
They have existing contracts with professional tradesmen for any maintenance or repairs
They help alleviate stress, and give you more free time as the landlord by taking care of tasks you would otherwise be required to complete yourself
However, they also come with some cons:
Hiring a property manager can be quite costly for the landlord. This is the main deterrent for property owners, as it can take quite a chunk out of the landlord’s pocket. Consider that all management fees are tax deductible.
A lack of involvement with the property. Some landlords prefer a more personal relationship with tenants, and like to be involved with all the current maintenance and operations of their property.
Whilst property managers can be quite costly, the pros definitely outweigh the cons. If you are able to comfortably afford a property manager, then it is recommended to utilise one for your real estate investments.