Trust – A Special 5 Letter Word
Real estate as a profession is ranked in the bottom 5 of least trusted professions in Australia each year, usually just higher than car salesmen and advertising people. As a highly regulated industry investment property owners turn to real estate agents to manage their property. You need to trust that your managing agent is doing the job you are paying them to do and you need to trust that the tenants are doing the right thing and looking after your property. You need to trust the advice of your agent in pricing your home and you need to trust that what they are saying is correct.
Unless your property manager is a life-long friend or a relative, trust must be earned. I like to use the analogy of a bank account to describe trust, only it’s an emotional bank account. When you start out with a new managing agent you have $0.00 in your trust account, you don’t know them, they don’t know you. They say they are going to organise photos to occur on Wednesday and they do, your trust account has just been deposited with $10.00. Your agent then says they will phone you after the first inspection and they do, another $10.00 deposited into your trust account.
This is going well you think to yourself, I picked the right agent … they let you know about subsequent inspections and even more money is deposited into your account. But then they ask for a price adjustment of $15 a week less than what they originally told you the property was worth. Your trust account has just taken a hit and $30 has been withdrawn. You receive a phone call from your old neighbours that the grass is very long, the grass that the agents are supposed to be maintaining and your account takes another hit and more money is withdrawn.
Your property manager then calls to put forward an application with two dogs and you have clearly stated that no pets are permitted – your emotional bank account is now nearing a zero balance and your trust and confidence in the ability of the real estate agency to manage your property is nearly gone too. You finally secure a tenant, one without any pets and then a month after they move in you receive a request from the tenant to add a dog to the lease and this is the final straw. Your account is now in the red and you need to decide if it is possible to get back in the black or go further in debt.
If your emotional bank account is hovering at a zero balance or is in the red you need to act now as it is unlikely that things will improve without intervention. I would recommend the following course of action:
1. Make a list of the instances that have resulted in a withdrawal from your trust bank account
2. Review each item in the list to determine which category they fit into Communication, Experience, Attention to Details, Timeliness or Processes and Procedures
3. Make an appointment to discuss your concerns with your Property Manager or better still the Principal/Owner of the real estate agency
4. Determine whether you want to continue to use the real estate agency to manage your property based on their response to your concerns.
If you do decide to terminate the management you need to give your current managing agent thirty (30) days written notice – it can be less if they agree and start interviewing some other agents for the job.
Feel free to use our list of questions to ask your potential property manager to help you to narrow down the right agent for you, one that you can trust with one of you most expensive assets.