Owning a rental property is a great way to build your investment portfolio and diversify your assets, especially as a retirement strategy. When you purchase an investment property, you have the option to engage a property manager to manage it or choose to self-manage it. With rising costs of living, it’s tempting to simply manage your property yourself. However, there are pros and cons you need to know.
Employing a property manager to oversee the day-to-day intricacies of property rentals can remove any potential stress caused by maintenance or tenancy issues. Property managers will also use their skills and market knowledge to maximise the return on your investment. However, managing your property yourself may be another alternative if you have the time and resources.
Jaime Pratt, Head of PM at VPM, believes this strategy has both risks and benefits. “The biggest benefit many people associate with self-management is financial, “she says. “This option incurs no property management fees, letting or leasing fees, or ancillary charges. It also comes with no representation at the tribunal, no advertising and no marketing activity. Self-managing will also allow you to be more hands-on with the property’s management. You’ll liaise with the tenants, keep abreast of rental payments, and manage day-to-day property maintenance. Some landlords feel they have control of all aspects of your property as they are in charge of meeting with and approving tenants and building a relationship with them throughout their tenancy. This also includes all communications with them by phone, email or text.
It’s worth considering the less obvious financial costs associated with this strategy, too, especially if things go wrong or awkward conversations are needed.
Hiring a professional property manager can reduce stress and save the time needed to realistically manage an investment property effectively. “Property Managers are qualified and trained with the most up-to-date knowledge and advice relating to the relevant acts and legislation surrounding rental properties,” Jaime explains. “They can navigate any challenges that may arise with tenants and represent you at tribunals and insurance claims if required.”
“A property manager will also oversee rent collection, ensuring tenants are paying their rent on time per the agreed schedule and, should they fall into arrears, taking the relevant action that is required.”
Jaime advises landlords to seriously consider what their time is really worth. What other priorities should you be turning your attention to?
“The time it takes to show tenants through properties, process applications, and prepare the required lease documents and condition reports can really add up. A property manager and their team can give you back these precious hours, not to mention alleviate any potential stress that may come with various situations.”
Property managers will also have built a network of trusted, licensed and insured preferred suppliers. They’ll ensure that work is carried out satisfactorily at a reasonable cost and will help mitigate any losses for you.
If you’re deciding whether to self-manage your investment property and would like an obligation-free chat to compare your best options based on your situation, contact our qualified property management team to see how we can help.