VICDOC Winter 2022 - Magazine - Page 87
urging demand for rental homes means
investors seeking yield are reaping the
benefits. Melbourne house and unit rents
rose for the sixth consecutive quarter to match
the longest rental price growth period achieved
in 2007-2008, according to Domain’s March
2023 Rental Report.
Having said that, it is pivotal for investors to
ensure their property is managed astutely if
they are to optimise the rewards.
Unlike residential property, most mainstream
investment asset classes are passive. You
invest your money and entrust others to
make it grow. Direct property investment is
unusual in that it brings with it a management
function which, depending on how well it is
executed, can heavily influence the success
of the venture.
Naturally, most investors recognise that they
don’t have the time or requisite knowledge and
look to outsource the tenant recruitment and
management role to property managers.
The challenge is finding the right property
manager; one who will provide a high
standard of service at a fair price. So how
do you identify prospective candidates?
Taking control means not just opting for the
status quo and giving the role to the agent who
you bought the property from. They need to
prove that they are the right property manager
for you.
It is also important not to be too fee
focused. Don’t necessarily go for the cheapest
quote. You are looking for value for money.
Remember, a thorough — but possibly more
expensive — manager will likely result in
better quality, happier tenants; lower tenant
turnover and higher occupancy rates; lower
maintenance costs and higher income.
The ideal way to source prospective property
managers is through a referral, but regardless
of how you source candidates, it is critical
you ask the right questions to ensure that the
manager is the right match for you.
S
HERE IS A LIST OF QUESTIONS YOU MAY
WISH TO ASK A PROSPECTIVE MANAGER:
1
What comparable properties have they
leased recently and how long were each
of those properties on the market before
they rented?
2 How do they plan to market your property
for rental?
3 Does the agency take professional
photographs and write a thorough and
realistic description of the property to
attract tenants?
4 How do they use online marketing?
5 Does the agency do thorough and
complete condition reports including
photos to protect me from any damage
to the property?
6 Does the agency conduct regular
rent reviews so I can make sure I am
getting the best rental return from
my investment?
7 When finding a tenant for a property, what
is the process of approving a tenant? Do
they interview the tenant and do thorough
and comprehensive checks including
tenancy database checks?
8 Who will be managing the property? How
many other properties do they personally
look after? How long have they been in the
property management industry for? Does
my property manager undertake regular
training and is up to date with legislation?
9 Does the agency conduct regular periodic
inspections, which include photographs
and a report sent to me?
10 Does the agency have a team of qualified,
reliable, and trustworthy tradespeople?
11 What are the property management firm’s
leasing and management rates?
12 Ask to speak to 3 referees.
Residential property investment is not
a passive holding. Even if you outsource
property management, you still need to
manage the manager. But it need not be a
chore if, from the outset, you demonstrate
that you expect a high service and will hold
the property manager to account.