Are there any additional risks that I would be exposed to if I was to find a tenant for my Investment Property apartment as opposed to using an agent to find a tenant? Does using an agent mitigate any risks or is it just for people who don’t want to do it themselves due to issues of time etc? Are there any legal issues in doing it yourself? What are the pros and cons of using an agent v privately tenanting?
Self-letting: You dictate when and how long you will open the premises (agent will allow 30 minutes)
Self-letting: You meet/greet/screen perspective tenants & colour your judgement with your own perceptions (agent has to comply with discrimination regulations, will undertake necessary employment checks etc)
Self-letting: Need to become acquainted with the requirements of letting out a property, information to tenants etc (agent has been trained to provide certain information to the tenant as required by Fair Trading Dept)
Self-letting: You are at the forefront of every issue eg water not working at midnight etc. Agent has list of contractors & doesn't lose any sleep.
Self-letting: You have to provide receipts etc. Agent issues you with copy of monthly & annual statement (as well as tenant receipts when required).
Self-letting: you have to look after all maintenance issues. Agent handles these through contractorsIf you choose to find a tenant yoruself it may take much longer than if you used a property manager. Property managers (I am talking of good property managers here, not average ones as we all know we avoid those) have a database of propsective tenants and have a good advertsing system designed to find tenants quickly.
If you choose to find a tenant yourslef, you may end up having the property untenanted for a week or maybe two weeks longer than if you engaged the services of a good property manager. If you are renting a place for $400 per week and it is untenanted for 2 weeks, that is a cost of $800 that you have incurred as a result of not using a good property manager.
Even though you may save yourself a few dollars per week in management fees, the real saving is much less due to the reduced rent you recieve as a result of a longer vacancy.
Cheers,
Luke
P.S. I am not a property manager and never want to be one!!!i think if you are considering it then you should try self letting. at the end of the day it will give you a good experience of what it requires to manage property and will give you insight into being able to pick (the traits of) a good PM
i self mamaged my first property and even though i probably didnt save money over the year i think it really helped me learn a lot and helped me realise that my time truly is money… in fact i had of i prob would have been better off because as you may know, that weekly management fee is tax de-ductable:)
totally agree with Luke, but you cant beat first hand experience!
I am a property manager and you should look at giving it to one to manage your investment property.
They use TICA to select the right tenant for your property.
If you decide to manage the property yourself you should give TICA a call to see if you can become a member.
Managing your own property is hard and you have to be-careful you don't get emotionally attached to the tenant as that is when all hell breaks loose and the tenant could end up taking advantage of you.
We (wife and I) found ourselves constantly managing the property managers. Reminding them of overdue rent, inspections that were never carried out, etc. We find it much easier self managing. Granted, we haven't had any nightmare tenants yet (touch wood).
I think I have just had bad experiences with the few PM's I've dealt with and I have no doubt that most are excellent at their jobs.
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
I manage my own investment property. May be I have been lucky but I have had good tenants who have looked after the place. I like to be able to choose the tenants myself and be in control. I dont find it difficult or time consuming. I check out the prospective tenants and also go off a bit of gut feeling too when I meet with them and talk to them.
I own a traditional agency as well as a online agency. The online agency has been set up to specificaly to give would be owner managers the tools they need to be at least as sucessful as an estate agent. Luke has eluded to the main risk that owner managers encounter is that you will have less advertising exposure than the agents as you can not access http://www.realestate.com.au and subsequently your property is likely to be vacant longer and/or you will have less choice of the best tenants because this portal dominates rental searches in Australia. <moderator: delete advertising>
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