10 qualities of a good property manager
After purchasing your investment property, the next key decision you will need to make is who will manage your property?
Although many investors are financially-savvy, when it comes to finding tenants, dealing with day-to-day property issues or government legislation they are left in the dark.
A good property manager can have a significant impact on your investments performance. So finding a top performer is important.
But how do you choose a good one…what qualities should you look for?
Experience, credentials, testimonials and references. These are probably the most important qualities you need to assess. Make sure you ask each property manager on your shortlist to provide details for their experience, how many years they have been a property manager, how many properties do they manage and how many are similar to your property. Ask them what certification they have and how they stay on top of the constant legislation changes. It’s also important to ask them to provide details of current and past clients that you can contact for references.
Your property is a valuable investment and entrusting your care to an experienced and certified property manager is a must.
2. Local market knowledge
Having a strong understanding of the local market is important. Firstly, so they understand the value and potential rent you can realise from the property and secondly so they are aware of any particular local regulations enforced by the local council. Plus, they have local tradespeople and can be on-site at your property if things go wrong and they know how to reach, appeal and attract the best quality tenants. A local property manager gives you a big advantage.
3. An investor mindset
Finding a property manager that has an investor mindset is gold. One who is able to see the big picture and work with you to help you achieve your investment goals. One who is able to guide you as to where to spend money so you can charge higher rent, and one who lives and breathes the local rental market so is on the look for out for opportunities to enhance your portfolio.
Not all property managers have this ability or know how, but you’ll want to make sure they show a commitment and eagerness to learn about real estate investing.
4. Good communication & organisational skills
Property managers deal with landlords, tenants and contractors all day every day and those that exhibit excellent communication skills, both written and oral stand out the others. Having this skill enables them to manage and reduce disputes, convince landlords to make upgrades to their property and to work with contractors to ensure the job gets done as quickly and seamlessly has possible.
5. Focus on protecting both landlords and renters
A good property manager will be highly focused on ensuring that both the landlord and tenant are protected. Having a strong understanding of the relevant state laws relating to fair housing and disabled access will help protect the landlord against discrimination and by ensuring they inspect the property regularly and manage repairs in a timely manner, will help protect the landlord against potential lawsuits.
Property management can be stressful. Things go wrong, sometimes tenants can be unruly, investors can sometimes be unrealistic with their demands and contractors may not be as reliable as you’d like. So having a property manager who is patient, someone who has great customer service skills and appears to be able to handle stressful situations whilst juggling multiple jobs at once is a winner.
Whilst it’s important to have a property manager who is patient and understanding you also want them to be assertive. You want them to be able to track down late payments from tenants and push contractors to get the job done in a timely manner. In some cases, you need them to push you too to complete necessary repairs or make much needed upgrades.
8. Ability to manage problems
Things go wrong, tenants go missing in action and skip paying rent, the plumber fails to show up and the landlord fails to send important paperwork. A property manager’s ability to think outside the box and manage problems is a winning quality. This is hard to assess, but perhaps ask them to give you an example of how they have handled a situation when it went wrong. You can also discuss this with their clients when you do reference checks.
9. Committed to further study
Property management legislation changes constantly so it’s important to find a property manager that demonstrates their commitment to study, to stay on top of legislative changes and to be aware of property investment law. Being part of a network that has a strong tradition of training is a bonus when choosing a property manager.
10. Attention to detail
As you know priority number one when you own a property investment is to make money. …which requires every cent to be tracked and documented. You’ll want to ensure your property manager is super organised and can provide you with all the necessary rental statements, receipts and copies of all invoices, depreciation schedules and scrapping schedules if they managed renovations for you. Getting the paperwork right, can have a big impact on your claimable expenses and therefore the profitability of your property. Being detail orientated is a big advantage here.
Now you know the 10 most important qualities to look for, here are some questions you should ask when interviewing a property manager.
- What is your average days on market?
- What is your average days vacant?
- Where do you locate most of your prospective tenants from?
- On average, how many properties does the agency lease each month?
- What human resources has the agency allocated to leasing properties?
- Do the agency staff members personally show prospective tenants through properties?
- How does the agency market available properties for lease?
- How much information is obtained from applicants for properties and what information is verified?
- What is your enquiry level per month? Do you have a database of prospective tenants?
- How often will the agency show my property?
- What documented systems are in place for property management?
- What is your process for dealing with rent arrears? What % of your portfolio is in arrears
- What is your process for dealing with repairs and maintenance?
- What steps do you take to ensure that all contractors working on my property are properly licensed and insured?
- What steps do you take to ensure that all maintenance work on my property is competitively priced?
- What is the experience level of the staff members who will be leasing and managing my property?
- What training programs do the property management team invest in, each year to keep up to date?
- How frequently will you transfer my rental funds into my account? May I see a sample statement?
- Can you send me rent statements by email and deposit my money in my bank account electronically?
- How frequently will you inspect my property?
- When will the first inspection of my property be?
- How many people will I be dealing with from your office and who?
- Can I have online access to my information?
- What references do you have from satisfied clients?
- Do you provide an experience guarantee/promise?
- Does the agency have documented experience standards?
- What back up staff are there in the event my property manager is sick or on holidays?
- How frequently will the agency communicate with me and what form will it take?
- When was the last time someone reviewed your mortgage for savings or additional borrowing capacity?
- Have you spoken to anyone about your current utilities and whether there is an opportunity for you to save money?
- Will the agency only call me when there is a problem? Do you have a communication benchmark?