Selecting an agent
Property managers who offer their services for a fee must be registered real estate sales representatives working for a licensed real estate agent who is in charge of the agency.
If you choose to use a property manager, carefully consider the person’s experience in property management. Ask about:
- their agency’s management portfolio and the types of properties it manages;
- the property manager’s own approach to managing your property; for example, the frequency of inspections, their manner in dealing with people and the level of fees they will charge.
What to expect from your agent
Remember, you don’t have to use an agent for everything. Some decide to pay a ‘letting fee’ and only use their agent to find a tenant and deal with the bond, while others use their agent to manage their property and/or collect the rent. No matter what you decide, ensure their experience matches your needs.
If you do decide to use an agent to manage the property, you can expect some or all of the following services (depending on the agreement you sign with them):
- advice on rental values, rent reviews, insurance and any necessary repairs before the property can be let
- advertising for and locating potential tenants;
- selecting tenants and collecting the rent;
- collecting, lodging, varying and applying for the release of security bonds with the Bond Administrator;
- collecting rent payments;
- preparing the property condition report at the start of the tenancy and providing two copies to the tenant;
- inspecting the property and ensuring it is suitably maintained;
- paying accounts (eg water service charges; council rates);
- arranging repairs;
- providing relevant notices and financial statements;
- issuing breach/termination notices to the tenant, or arranging for court proceedings when appropriate;
- attending court on your behalf if there is a dispute with your tenant/s; and
- at the end of the tenancy, checking the premises and completing the property condition report with the tenant and finalising matters relating to the bond.
If you use a property manager you will also need to give them written authority to act on your behalf. Any fees you pay your agent and some other expenses are likely to be tax deductible.
It’s important to provide your agent with clear written instructions outlining any matters you want them to handle, and listing your specific conditions/requirements. For instance, before signing any agreement ask yourself these questions:
- How often do you want inspections to take place (no more than four routine inspections per year are allowed)?
- Do you want a copy of the property condition reports and inspection reports?
- If a rent payment is late, do you want to be told?
- Do you want them to arrange repairs that you authorise?
Once you sign an authority for an agent to manage your property, it binds both you and your agent for the agreed management period, so make sure it contains the right information.
If you decide to use another agent to find your tenants while this agreement is in force, you could be liable to pay a fee to both agents. Make sure you keep a final fully signed copy of your agreement, just in case things need to be clarified later on.
Remember that an agent can’t be held responsible for the conduct of your tenants. All they can do is use their expertise to help you select a tenant that, based on all the available evidence, seemed to be the most appropriate at the time.
You can find additional information in the publication You and your property manager.