Do You Hire A Property Manager Or Take Care Of The House Yourself?
A Tip from a Real Estate Agent
Here are a number of factors for you to consider when you're making the decision about whether or not you're going to hire a real estate property manager to take care of your real estate investment property or if you're going to manage it yourself.
Primarily, the typical goals of real estate property investors are to protect their investment and maximize the returns they make on their real estate investment properties, so the first decision must be financial.
Before you hire a real estate property manager, you need to get a good, realistic idea of the costs.
Real estate property managers do not work for free.
Real estate property managers will charge a fee usually based on a percentage of the rent they collect.
There may also be costs payable to the real estate property manager associated with advertising, and finding and vetting prospective tenants.
Real estate property managers have quite a task ahead of them when you take into account all of the time involved and all of their duties they must carry out for their clients.
They do save their clients a lot of wasted time and they are the trained experts in real estate property law and the real estate residential tenancy act and they are required by law to keep up to date on all of their training and knowledge.
Do you want to have to spend all of your spare time learning all the legal rights and responsibilities you have and what the tenant has and do you want to spend all of your spare time up dating your knowledge so you do not receive fines from the Office of Fair trading for not knowing the do’s and don’ts related to real estate property management.
This needs to be balanced against the costs of doing the work yourself.
You need to consider the value of your own time, whether you'd get a better return working in your primary job or looking for other real estate property investments.
You also need to consider your experience and skills.
If you are available and able to do basic repairs and chase up unpaid rent and ensure you are meeting your legal obligations to your tenant, you may be able to manage it yourself.
However, if you are trying to fit managing a property in around your other work you may find dealing with phone calls about leaking tap, trying to chase up a plumber and seeking advice about debt collection and eviction procedures takes more time than it is worth.
Again consider it carefully do you really want all of this on top of what you do now?
Real estate property managers have volume advantages which mean they have reliable tradespeople they can call on to get repairs done in a timely and cost effective fashion.
They are also familiar with Tenancy Laws and will ensure all work done complies with standards.
Real estate property managers are generally well placed to know what the market rates are for rent in your area.
This is important so that rent is high enough that you get the best return, but also attractive enough to tenants to keep the property rented out consistently.
It can be hard to establish the right rate without expert guidance.
You will need to have procedures in place for chasing up unpaid rent.
Getting late payment from tenants can be difficult and awkward and you run the risk of being not notified about maintenance if they are trying to avoid you.
Professional real estate property managers have systems in place to collect rent.
This is particularly important if being paid on time is vital to your cash flow.
Being your own real estate property manager and managing your own rental properties is an extensive learning curve, which may be beneficial if you are considering making property your primary career.
However, if your intention is just to make money from investing in real estate property, a real estate manager is probably the more sensible way to go.