Oh TheFrugalSamurai I missed you so much, please don’t ever leave me.
There there, it’s OK – I’m back now!
But wait – where did you disappear to?
Adelaide people, Adelaide.
What’s Adelaide? Is that a cool and refreshing drink?
No no – it’s a city in South Australia renowned for… umm… renowned for…
(Cue dream-like music as scene travels back in time and fades to black.)
(New scene, camera pans to car cruising down a busy road. It is night.)
“HEY THEFRUGALSAMURAI WHAT’S YOUR BLOG ABOUT” said the person in the front passenger seat as we drove from Adelaide airport to our City hotel last Friday.
“Well MrsFrugalSamurai-to-be’s friend, it’s about personal finance and development”
“I’VE READ IT – I DON’T GET IT, WHERE ARE THE PERSONAL FINANCE AND DEVELOPMENT?”
“You blind old duck, do you know how to READ, it’s here, here and here” I almost blurted, instead of “thank you for the feedback, I’ll take it on board Emili (not her real name), greatly appreciated”.
For the rest of the drive to the hotel however, I realised Emili had wisdom in her words – damnit she always does.
That’s why between all the food, wine and good times I was so glad that a couple of other ladies on our trip asked me my thoughts regarding property management. (Property Management is where you pay people to manage your property – took me awhile to figure it out too).
Finally something on personal finance and development to talk about in correlation with our weekend getaway! I was stoked.
One of the ladies had a very poor experience with her previous property manager, “he was shit, how do you find someone who is not you know, shit”.
We all have a little shit in ourselves ma’am is what I was thinking of saying, but again I didn’t back myself – I’m just shy.
Coincidentally another friend of mine also asked me in a separate conversation regarding property management when we returned from our trip.
RISE good property managers – you guys are the most sought after people apart from amazing personal finance and development bloggers.
I’ve gone through a few in my time and can tell you that when you find a good one – stick to them like glue. Mind you, not physically, that would be difficult and socially awkward in modern society.
Below is what I did to find good property managers both local and inter-state:
Talk to people – wow such a profound and insightful comment.
No seriously guys, word-of-mouth marketing is the most powerful form of marketing there is.
If you receive positive service or value, you may tell people about it. But I guarantee if you receive negative service or feedback you will tell people about it.
It’s just who we are deep inside.
There are plenty of forums and websites out there just waiting for your perusal. Once in, read the reviews and then private message the posters – you’d be amazed how talkative people are online, especially if they had a bad experience.
Shortlist a few property managers – once I discerned which ones had positive feedback, I called them direct and basically interviewed them with the following questions:
- How long have you been a property manager? (Obvious but easily missed)
- How many properties are you/your staff managing right now? (Too many and they may not “service” your property with enough attention. Too little and it may be a sign the business is not mature or floundering. A good rule of thumb is around 70-90 properties per manager).
- How many vacancies are on your books currently? (Is it because of their lack of initiative, or because of the specific area?)
- How long does it take to fill a vacancy? (Gives you a good guide as to what to expect for the suburb you invest in, shorter the vacancy time, better it is – vacancies will make or break your net rental yield).
- What is your eviction process? (GTFO of my property, oh wait, there’s a process to follow… what is it?)
- What is your late rent policy? (Ditto to above, late rent is a sign but not necessarily a red flag unless it is consistent).
- What are your fees? (Remember everything is negotiable. Fees include: management, advertising, leasing, lease renewal, routine inspection, admin, taxes e.g. GST and a whole bunch of others which gouge into your returns, be mindful of this necessary evil).
- How do you screen prospective tenants? (It’s normally a standardised process of references, references and more references cross-referenced with the tenant register which is also a reference).
- How do you collect rent? (i.e. when and how do I get paid bro?)
- Which contractors do you work with? (This is a tough one as you won’t know the quality of their maintenance contractors until they actually go out and fix things).
- How long do I have to give notice if I want out of our agreement? (If things aren’t working out, I don’t want to be locked in for 90 days whilst a shitty property manager continues to collect fees off me, I’d want to move asap, try to negotiate for 30 days, less the better).
However the most important consideration in my view is communication – like any good relationship they need to communicate well, that’s why I am mindful of value but I am even more mindful of communication.
Communication begins at the start with all the little things – do they return phone calls, how soon, do they keep me updated with what’s going on, are they quick to reply to/action requests etc. You know the drill.
You could of course self-manage the property but personally I’d rather pay a professional to allow me to concentrate and focus on other things.
Also when the shit hits the fan, you’d want someone there who’s good at cleaning shit from fans.
A good property manager is an integral part of your property portfolio as they are your eyes and ears on the ground.
End of the day you are paying them for a service so why shouldn’t you deserve the best?
Unfortunately, you won’t really know whether they are good or not unless you partner with them so please make sure you constantly review whether what you are paying is worth it.
If it’s not worth it and you are continuing to pay them, pay me instead – I’ll sing and dance and make you jolly for the same price but for a much better outcome.
What do you think? Did you enjoy this post? Please help me out if you enjoyed this and click on the little “follow” button at the bottom right and be a follower. This way, you’ll never miss my words of awesomeness!
P.S. A friend suggested I put a disclaimer for all posts in case someone followed my strategy and advice to the letter and it didn’t work out for them.
Flattering as it will be, these are my personal opinions only so please, please, please do not proceed any legal action against me if things go sour (lawyer speak for “fucked”).
Please do your own research and above all caveat emptor – let the buyer beware (I was quite proud of myself when typing that Latin phrase, felt so EDUCATED).