The Pros and Cons of Using a Property Manager

One of the biggest advantages of having a property manager in place is that we not only do all the actual management for you - selection of tenants, completion of appropriate paperwork, inspections etc. - but also much of the accounting. Most property managers will supply a monthly statement detailing the gross income, the expenses incurred,  commission and the net amount transferred into your bank account. This makes for very easy accounting.

Another advantage of using property managers is that the less pleasant work of evictions, notices of rental increases and notices requiring tenants to remedy shortcomings in keeping the property clean and tidy, no longer need to be handled by you personally.

So how do you choose a property manager?

Just like with the selection of a property to buy, or the selection of a property manager to work with, or the selection of a tradesman to work on your properties, it is somewhat of a numbers game. Go with recommendations from friends or other landlords, interview prospective managers, ask them how they have dealt with particular problems in the past, and then try them out.

To summarise:
On the plus side agents can save you:

• paperwork
• having to deal with courts and eviction notices
• unpleasant issues like informing tenants of rent increases and complaints against them

On the minus side, a less reputable manager can be:

• Lazy or irresponsible or negligent
• Slow to get the proper repairmen out quickly
• Neglectful about informing you when there are serious problems with your property

Here are some additional facts that could be deal-breakers for a landlord in selecting a property manager.

One of the first things you should do when selecting an agent is to see what the caliber of his tradesmen were like. Do they have a decent plumber, roofer and electrician? Are they reliable? How much are their average prices? 

Now let's say that the tradesmen all check out. Now you are faced with an equally monumental task of checking out the capabilities of a prospective property manager. The laws of a country change frequently and you, as well as your property manager, should keep on top of those changes. Your manager has to chase the rents, document everything, pay you the rent on time and make sure that he has referenced the tenants properly and has accepted documents that are legally binding. Both you and the management agency have to keep on top of all the properties that you own: when the rents are due, when they are paid, when they are posted to your account, whether the correct amounts have been paid, that you have up-to-date agreements between yourself and the agency, that all your tax records are accurate.

If you think that property management is like a walk in the park, you will be in for a rude awakening. There are complex tax issues, laws governing those taxes, laws concerning tenant rights, landlord rights, evictions and contracts. You need to be prepared to spend a great deal of time and energy as a property investor. It's not a question of just finding a wonderful property. You then have to make sure it remains so. 

A property manager may not know that the building is developing dry rot. He may not know that the wiring needs to be replaced. He may not know that there is subsidence to the building. But since all of these things and many more greatly affect the property that you are buying, you need to keep on top of these things. These are things that the property manager is not responsible for. So while you can always get yourself a property manager to handle the day-to-day operations, you cannot really afford to be an absentee property owner.

To summarise:

• check out carefully the tradesmen on the property manager's books. 
• ensure both you and your agent are up-to-date with tax laws and your record-keeping.

With True Property Management (Vict.) your investment is in good hands.  Contact us today for more information or visit our site to see how easy it is to switch to True.