Professional care the best option
With about 40 per cent of WA rental properties now privately managed, according to REIWA statistics, property experts have highlighted the benefits of having investments managed by a qualified property manager.
Total Care Property Management owner and manager Gai Kroczek
Mrs Kroczek said there were many advantages in using a professional property manager over privately managing an investment property.
“One of the main drawcards was qualified property managers could ensure a property was well-maintained to ensure capital growth, and keep the rent in line with market values, ” Mrs Kroczek said.
“When a property is managed by an owner, the owner is often reluctant to broach the subject of rent increases and so the yield from the property diminishes over time, especially if the tenant remains in the property for a long period of time.”
“Maintenance can also be neglected simply because no one is making them accountable.
“Another advantage is compliance with current legislation.
“A property manager will always be up to date with the latest forms, legislation requirements and allowable lease conditions, whereas managing a property yourself means that you may fall into some of the compliance pitfalls.”
O’Rourke Realty Investments principal Rory O’Rourke
Mr O’Rourke said many first-time investors overlooked the benefits of using a property management company.
“Many first-time investors tend to overestimate the weekly rent they should charge, resulting in lost income through a high vacancy rate, ” Mr O’Rourke said.
“A property manager will be able to give an independent assessment of the correct rent for a rental property. A property management company will also have access to information on people with a history of being bad tenants and also undertake a thorough background check on all applications.”
A professional property manager was also experienced in property marketing, contracts, legal issues and keeping the relationship between tenant and owner professional.
“Investors who manage their investment properties tend to develop friendships with their tenants, which means that problems can arise when the tenant fails to pay their rent or maintain the property, ” he said.
“By using the services of a property manager, the relationship is kept on a business footing, which will be financially beneficial for the investor.”
Acton Group director Travis Coleman
Mr Coleman highlighted the importance of using a property manager, particularly relating to the changes in tenancy laws and issues that can arise from non-compliance.
“If you choose to manage your investment property on your own you must ensure you are extremely familiar with the Residential Tenancies Act and Regulations and the recent changes that came into effect on July 1 of this year, otherwise you are putting yourself at risk of court proceedings and significant fines, ” he said.
“There are new rules relating to when you need to act on repairs, security, property condition reports, notice to end a tenancy, inspections and much more.
“Failure to comply with the legislation will result in significant financial penalties and the Department of Commerce (Consumer Protection) will not hesitate to take action.”
REIWA president David Airey
“Unless you have lots of spare time and some basic legal competencies it’s best to use a (property) manager, ” Mr Airey said.
“Apart from their knowledge of the Residential Tenancies Act, they can also act as a conduit between you and the tenant, which is very important if a problem arises and you need to avoid personal confrontation.”
Mr Airey said property managers could also represent the landlord if a matter were to make it into the Magistrate’s Court, thereby lessening the stress and time pressure on the owner.
“Today’s tenants are better informed with online advocacy but often that information is misinterpreted, or wrong, and it leads to a communications breakdown between owners and tenants — managers can bridge that gap, ” he said.
“They are also good at understanding vacancy rates and undertaking rent reviews to ensure you get the right rental return in changing markets.”
© The West Australian
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