How to select the right property manager
If you are a first-time investor or find yourself in the position where you need to rent out your home, selecting an agency to manage your property can be a huge leap of faith. Handing over the keys to a stranger to manage and take care of raises many questions relating to trust, experience and competency. After all, it is one of your most expensive assets.
Recommendations from family and friends are always a good place to start as there are generally many agencies to choose from. If you have narrowed down the list of agencies to interview, we can suggest 5 questions relating to experience that you may not have considered.
Why are we concentrating on experience? Some say that experience is over-rated, but real estate sales and property management are high staff turnover industries. There are many varied reasons for this, but the average life span of a Property Manager is only 9 months. Property managers, like sales agents, do tend to move onto what they believe are greener pastures with a new agency and generally after their third or fourth agency they will leave the industry altogether.
Question 1 – Is my potential Property Manager an owner of the business?
There is an stark difference between being an employee of the business, paid a wage to perform the duties of a Project Manager, and an owner of a business, who will ensure that your satisfaction is paramount. Your fees are their livelihood and their reputation depends on referrals and reviews from clients just like you. As the owner of the business the buck stops with them. Owners of the business aren’t going anywhere and will generally be there for the life of the business.
Question 2 – Has my potential Property Manager ever owned a property or an investment property?
Over the years, I have come across Property Managers that haven’t even moved out of Mum and Dad’s home let alone had the responsibility of paying a mortgage. I even had another that had the tenants on a “payment plan” because they were behind in their rent (to me rent is a payment plan).
Investors are not a charity, they are a business and they expect to see money in their bank account once or twice a month to assist with covering the mortgage repayments on their investment property. Without understanding the responsibilities of property ownership, it can be difficult for a Property Manager to “walk in the shoes” of an investor.
Question 3 – Will the person appraising my property be my Property Manager, or will it be handed off to someone else?
Often, real estate agencies have a Business Development Manager that appraises properties and their focus is to bring investors, like you, into the agency to grow the rent roll. Business Development Managers, or BDM’s, are generally experienced ex-Property Manager with excellent communication skills and salesmanship. They can promise the world but aren’t the ones that must deliver. Once your have signed an authority they hand you over to your allocated Property Manager, if they run a portfolio office, or a team of Property Managers, if they are task based.
Questions 4 – Does my potential Property Manager have more than 10 years’ experience in real estate?
The career path in real estate generally starts at the Receptionist, the face of the business when you walk into the office. Often, they are new to the real estate industry, recently left school and green. Performing well in their role, they progress to become a Property Manager filling a void that perhaps has been left by another Property Manager departing.
This is where they tend to sink or swim. Agencies that throw them into the deep end as a Property Manager rather than an assistant Property Manager are suddenly dealing with finding new tenants, managing clients, tenants and tradespeople, disputes, maintenance, arrears and the exiting of tenants. As a highly-regulated industry with over 300 pieces of legislation: communication, organisation and time management skills and knowledge of legislation is the key to effectively and efficiently managing your property. Without extensive experience things are likely to be missed or shortcuts made.
Question 5 – How many Property Managers do you have and what is their average age?
The average age of the Property Managers in an agency can give you an indication of their level of experience not only in real estate but also their general life experience. If you can’t meet face-to-face and only talk on the phone it can be difficult to gauge their age. Just like in a job interview, asking someone’s age is a no-no, however, this question will overcome any awkwardness.
So how are we different?
Both Rebecca and myself have been in the real estate industry for over 10 years and we have experienced every aspect of residential real estate – we have not only rented but owned an investment property, bought and sold residential property and built a home. We are both owners of the business and we are the ones that not only appraise your property, but we are the Property Managers for Blackbird and Finch.
Your property is not our training ground and nor should it be. Our average age is 40 and we have seen it all in real estate here in Toowoomba, the good, the bad and the downright hilarious. There is never a dull moment in property management and we love every minute of it.
To get in contact with Rebecca or Simone call our office on 07 4642 0007.