There’s an old saying in our Industry – ‘A great Property Manager should cost you nothing!’ – Well you’d be thinking, ‘mine costs me a lot more than nothing.’ We aren’t specifically talking about fees though; we are talking about value added service that puts money back into YOUR pocket. Let’s break it down.
AGENCY FEES: Yes, you are paying fees for a service. These fees can vary agency to agency and State to State. These fees are tax deductible and by the end of this article, I hope you see it as a great investment.
When people think Property Management, they think of all the usual tasks a Property Manager is engaged to do; rent arrears, manage maintenance, complete inspections, let the property etc. A GOOD Property Manager will do all the tasks assigned to them and hopefully do them well.
But let’s talk about what a GREAT Property Manager will do for you.
MORTAGE HEALTH CHECKS: A GREAT PM will recommend annual mortgage health checks and have a list of brokers handy to refer you to. A mortgage health check is a free service with a broker, that allows you to check your interest rate or consider using some of your equity to purchase another property. One visit to the Broker could save you thousands – more than your annual management fee.
MAINTENANCE SCHEDULE: The words ‘preventative maintenance’ are sometimes enough to scare a Client off, but hear me out. A GREAT PM will work out a personalised preventative maintenance schedule for your property. Things like smoke alarm servicing, wood heater safety checks and servicing, heat pump servicing, gutter cleaning, gas appliance checks - Not only do these preventative maintenance items ensure the safety of your rental property and the longevity of your appliances – they are also tax deductible!
INSURANCE AUDITS: Ever needed to make an insurance claim and found that you aren’t covered? Yikes. Unfortunately, I’ve seen this many times in my career. A GREAT PM will point you in the right direction to get the advice you need to make sure you have the right policies in place for you – Saving you when it matters most.
LONG TERM INCOME: A GREAT PM understands that you don’t want to be re-letting your property every 6-12 months. It is costly, stressful and leads to more wear and tear on your home. Despite the age-old stigma that Property Managers have with Tenants, A GREAT PM values their Tenants and makes them feel welcome in the home, negotiating renewals in advance to minimise vacancy - A long-term positive relationship is a win, win for everyone.
PROACTIVE UPGRADES: Ever get to the end of a tenancy and your Property Manager sends you a 3 page list of improvements required before the property can be re-let? A GREAT PM should be updating you at each inspection on cosmetic improvements recommended and wear and tear, so that you can budget for the big jobs at the time the property next falls vacant – No nasty surprises.
TAX DEPRECIATION SCHEDULES: This is a fantastic way to get the most out of your tax return, particularly for new builds or recently renovated homes. Most Quantity Surveyors provide a money back guarantee – So it is well worth looking in to.
RENT REVIEWS: Rent reviews can only be conducted in Tasmania every 12 months. A GOOD PM should be completing this as part of your renewal process or scheduling interim reviews in long term lease situations. A GREAT PM should be providing you a market report so you can review the data and see how rental properties are performing in your area. A GREAT PM also has connections with A GREAT SALES AGENT who can provide you with a sales market appraisal – so you have an idea of the growth in value of your asset.
Property Managers are responsible for managing very high value assets, not only is it important that you are getting the most from your investment – it’s also important for you to understand the value for what you pay in Management Fees. Whilst you might see it as an additional cost, if you consider the value to your investment – it’s well worth it.
Is your Property Manager a GREAT PM? If so, send them a little Thank you love (I promise your Superstar PM will love you for it!) If you feel that your Property Manager is costing you too much, send me a message and let’s connect.
Article by Caitlin Horder (Director), Spark Property Management
