Hi OzB comms,
So, my property's been under the care of a real estate/property manager, and it's only 3 years old. But what's got me scratching my head is the constant stream of repair requests – electrical, antennas, plumbing, you name it.
I'm thinking about taking the reins and managing it myself. What do you think? Any advice on self-managing? And if you've got any sweet online tools you know about, I'm all ears. Any recommendations would be awesome.
Thanks a lot!
checked that, I'll just have to update the insurance policy as a self-managing one.
Will that adjust the policy premium?
yes it will. (higher premium)
It comes down to whether you have the time and patience to deal with the tenants.
If you do, go for it. Make sure you read up on the Residential Tenancies Act so that you know what you need to do as a landlord - like how quickly to fix issues depending on whether the fault is classified as an emergency or not; what the timelines for various notices are for non-payment of rent, how to lodge bond, how to claim bond, etc etc.
The Kumar's at number 42?
"how quickly to fix issues"
based on my experience renting it seems there is either not legislated or my agents just didn't give a damn
Me too, waiting in several repairs and at this pin T would like to deliver my rent to my landlord wrapped around a brick.
OP also needs to have good handyman skills to attend to minor repairs and maintenance or otherwise some trusty tradesmen.
As far as all the repairs thet have been required (which is unusal for a new property) OP should have attended the property personally and checked them out to confirm validity and what or who was required.
There are some good online property management portals worth checking out.
Use rentstreet.com.au to advertise for tenants.
They only $99 to advertise in both domain and realestate.com.au and thier service is very good!
I think rentstreet also have a good online portal for DIY property management.
If OP is going to attend the property to check repairs that are needed then you should just self manage.
Here we go demonising tenants as irresponsible people that requires an entity to deal with making that landlord tenant relationship impersonal, non transparent and embedding that business relationship with a middle person which is unnecessary and add layers of bureaucracy.
Not only that but often Real Estate's are the bad guys in situations where things should actually be fixed/replaced etc.
What is your expectation in regard to the repair requests?
Will you provide this service as a business / income?
I never really expected so many repair requests for a property that's almost new. The current property manager keeps calling in trade people every time there's a repair request. Like, for something as simple as changing a toilet seat, they're charging $150 for the callout, plus another hour of labor, which adds up to $350.
I'm considering reaching out to another trade person directly and cutting out the middleman – the property manager.
Have you discussed this with your agent? You can tell them that any jobs above a certain amount for example $200, will need to be approved by you. It seems a bit excessive what they are doing so you might need to manage the manager a bit to get them in line for your standards
A lot of new houses are no where near the build quality of older homes.
Property manager should get permission for anything that's not an emergency.
New properties often have a lot of issues for the first few years, takes a bit to iron out the crinkles
New properties are major red flag by themselves. If you wish to save a few quick bucks and the repair is not an emergency eg broken oven that nobody uses, try negotiating with the tenant. Just do the math. A $300 repair costs more than reducing the rent for $5 for an entire year.
Next post title:
“I paid my tenant to ignore the broken toilet. Now my sink smells like urine???”
"repair requests?"
Deny, deny, deny. Sorry I agree with the owner that your request is not needed
.
OP's response appears to indicate that they don't intend to deny the repair requests, but to minimise the costs. OP doesn't appear to dispute the repairs are required, but were not expected and incur higher than expected costs.
Why would they take that extra risk on their license? 6% of rental income is literally peanuts.
related topic, is there any free good management software for ppl who managing own property?
to record the income, cost etc etc
yes apart from manual excel
Google Sheets
Excel
LibreOffice Calc
Xero.
Ah hadn’t thought of that one. Have never used it, is it much better than Excel?
Oh, is Xero free?
Xero is definitely not free. Free trial - yes, but after that it's based on a monthly subscription.
Pornhub
Sounds like they are taking advantage of your good nature. Find another property manager, maybe the people renting and the property manager are in cahoots to squeeze as much out of you as possible.
A good property manager is supposed to save you money and reduce your stress not cause it.
Who the hell would neg your post?
Sounds like good advice to me.
As someone who had been a landlord for almost 10yrs until recently, this was my first thought too.
100%
Investment properties are hardly a set and forget affair which a lot of people think it is.
They'll happily take the tenant's money and not put a cent back into the property.
Honestly this is just part of the job. I'd only recommend self managing if you have a fair bit of time on your hands, quite handy with tools and will happily give up your free time at a moments notice. Personally i'm not sold on investment properties, i'd rather pluck dividends from shares, lower maintenance.
Yes, very true. Especially if you own a property in Victoria- so much additional costs due to increased taxes and compliance requirements.
One advantage of investment properties is gearing which makes it easy to build up equity.
I don't self manage but sometimes when my agent advises a problem, I sometimes fix it or do myself e.g. $99 to 'test smoke detector'. It doesn't take long for me to press the test button when I'm driving past. But most of the time I get the agent to arrange as they have reasonably priced tradies on call.
Maybe it's just a new build that needs some fixing. We're also living in a new place and we've had to contact the property manager and landlord a few times to sort things out. We've dealt with five major issues so far one of which involved the RTA.
What's the major issues that you have had?
Leaking ensuite shower into bedroom & compliance/access issues.
Sounds like a shit situation for both you and the landlord.
@Muzeeb: They might be waffle stomping in the shower - that would cause the water not to drain fast enough and then leaks 😂
I self manage but I am considering finding an agent once this contract ends.
For the most part it is set and forget, but the letting process is exhausting.
You get hundreds of enquiries a day, most of them don't lead to anything.
50% request same inspections and/or ask you the most ridiculous things.
* listing has price and address - they will ask anyway
* listing says current tenants move out in 3 weeks time - they will ask if they can move in anyway
* 10% will ask if you can hold the property for over a month after your current tenants move out or ask you to reduce the rent by >$200 a week
* all of them will ask if the monthly rent you listed is actually weekly
most of the people who book in for an inspection won't show up or show up an hour early/late and get upset that they can't inspect now.
just too much of a headache, though i've been told some agents offer letting only services for a higher fee, not sure if that will balance since my place is furnished so tenants staying beyond the contract is rare.
but after that process is USUALLY very smooth sailing, unless you happen to get dumbasses renting like me
My one kept calling to ask me the dumbest things
how does the washing machine work? does it use liquid or powder?
what code did the internet company send you? - i provided them with the referral code, but they seemed to think their account's OTP was being sent to me
what are my CBA bank details? because they had a CBA account and thought they could only transfer to other CBA accounts…
Ended up ignoring anything that was related to their safety or apartment repairs
Ended up ignoring anything that was related to their safety or apartment repairs
Is that a typo?
I'm not wasting my time explaining how they should pay their electricity bill.
so no. anything I am not legally required to address, or does not benefit me, they can sort themselves.
They even complained that the stuff I LENT them at no extra costs wasn't up to their standard. asking me to replace it. They can go buy their own stuff then!
They wanted a TV, I got one, despite having no obligation to do so, then complained when I said we needed access to the property on the day of delivery, so I gave them the option to stay at home themselves, but they didn't want to waste their day off at home.
So yeah, no more Mr. Nice Landlord
Ended up ignoring anything that was related to their safety or apartment repairs
Surely these are the things you should not be ignoring?
Are you just going to kick these people out when the lease is up?
@jwsc: Yeah, in this market, you'd have to be some kind of idiot to deliberately piss off the landlord.
Don't bother self managing it.
Where did you find this dumbass?
For the 6.6% + 2 weeks or whatever you pay to find and manage a property, it's not worth it to self manage. The goal is long term capital growth, so it's just a tax deductible cost.
I must stress that you should find a good property manager. Ask prospective managers how long have they been on the job and how many properties do they manage?
To the point, Thanks for the good advice!
I assume the more years they’ve managed properties the better, but what about the question of how many properties they are managing? Is there a good range?
I assume too many and they won’t pay attention to detail or too little showing people do not like them as property managers?
I’d probably say a single property manager could effectively handle ~150 properties. Too little is fine.
I also forgot to mention, it’s preferable that the agent is local for both your and the tenant’s sake (if there is an issue).
Sounds awfully like the dumbasses on FB market place LOL
- all of them will ask if the monthly rent you listed is actually weekly
That is fair, we work in weekly rents here, monthly rents are a carryover from America and weirdly is something only present on facebook.
Rental property is a pain in the ass even with an agent managing it. I'd much rather buy shares.
Tenant expectations are getting much higher and the cost so much more expensive, I expect many to follow this path away from property. People seem to expect everything to be in new condition so much more than previous generations. A bathroom kitchen used to last 30 years, now people seem to think under 10 years, rent doesn't cover that level of depreciation.
In an interview with CNBC, Warren Buffett said, “If you buy a house, it’s probably the best investment you’ll make, but I don’t think you’re going to make as much money as you could have owning stocks over a long period of time”. https://www.cnbc.com/2018/12/17/warren-buffett-tips-on-how-t…
I've always managed my properties. Paying for a service that I can do myself is not me. Yes it has momentary hassles, particularly around change of tenants, but other than that it's usually set and forget. I must have saved tens of thousands of dollars over the 18 years I've done this. Better in my pocket than theirs.
Just wondering, are you located near your properties?
Yes same city which makes it easier. Though for 6 years when I was working overseas (SEA or Middle East), I still managed properties while being abroad. The key throughout is vetting your tenants and select only the good ones. Follow your gut. Families are always preferable to single people.
Families are always preferable to single people.
Please. Elaborate.
@Typical16-bitEnjoyer: More stability and they tend to rent for longer periods. My IP is a house in the inner north of Canberra, so not cheap. If I were to rent to a single person, they'd likely look to sublet the spare rooms which then gets a little messy. It's much easier to find a family.
I'm no equal opportunity landlord. If folk don't fit what I am looking for, they don't get the gig.
@Typical16-bitEnjoyer: Not sure why this is. If investors pulled out of the market, wouldn’t the rental crisis only get worse. I agree that the current system is hopelessly failing renters but shifting the blame on investors who are actually adding to supply isn't the right answer.
@Lunarboogie: Property as an investment does not drive the building of affordable rental properties.
Thanks, and is there a particular service you use for repairs etc?
@Brainwhacker: Thankfully I don't get bothered by many requests but where I do, I ask the tenant to find someone themselves and then bill me later. Easy peasy. Tenants also like the fact that I respond immediately to their inquiries, instead of spending days trying to get through an agent.
And the place was built in 1958 so I am not sure what's happening in OP's case.
Agree. I save tens of thousands of dollars a year managing my own properties.
it's only 3 years old. But what's got me scratching my head is the constant stream of repair requests – electrical, antennas, plumbing, you name it.
Either your tenants are a problem or your new build is badly built. I'd suggest it is a combination of both.
I've seen new houses end up with second fix work for years. That's why you don't go near budget builders. People don't understand how cheap & nasty fittings can be sourced from really old stock.
Tell your agent you had enough with their service and their crapp call out fees, trust me you wont hear from them again hahaha
Slum Lord Rental Property Recommendation
Having a rental property is a little like people management. You first need to find the right people, then you have to deal with them until they quit. If you like the idea of interviewing for and managing people, then this might be okay.
But I hate people, so I'm outsourcing it to someone else.
very good point! completely agree .
Dealing with people is not that easy !
I'd say a lot of this depends on what tenant you get and the general condition of the property.
As a tenant in a 30 year old house I've made 2 rodent requests and 3 maintenance requests in almost 3 years. For the most part I either do it myself or leave it unless it's a real issue because in my mind every time I put in a request I imagine the landlord upping the rent.
Property Managers are insanely overpriced for what they do (which is mostly automated) and everything they charge for is inflated and dangerously close to a conflict of interest (Tradies etc)
Somehow we've accepted that a property manager can charge a percentage of the rent as a fee as well as taking the entire 1-2 weeks rent while rents are skyrocketing and there being no relation between the cost of rent and the job the real estate needs to do.
Should I ask my employer to give me a wage based on the revenue of the company? I don't think so…
Once you do it yourself you realise how much they are ripping you off on literally everything, even something as simple as the listing fee which they make it sound like they are just passing on the cost, but they aren't.
This is eerily close to the 'insurance costs me thousands a year and I never have an accident/make a claim - I don't get anything from it'.
Some people seem to think a paid-for service is only ever 'worth it' when it's cost-neutral or positive. Forgetting that being your own PM is a job. Tenants have your phone number. They'll call you any time of day.
God forbid a business is allowed to make a profit.
Conflict of interest, I don't think you know the meaning of the term. Arrangements and referral (as an OzB, you know what that is) cuts are entirely normal for almost any professional service, and especially tradies.
(Speaking as someone whose parents have a number of properties being managed, but I'm the one who handles the comms with the PM)
This is eerily close to the 'insurance costs me thousands a year and I never have an accident/make a claim - I don't get anything from it'.
Not related at all, but a common excuse.
Tenants have your phone number. They'll call you any time of day.
If this is an issue for you, get a second sim and have a work phone, or just screen their call…
Pay for a PM when there's an annoying tenant, or a tenant that's behind on rent, or has hardship, or any kind of stress. Or when you need to find a new tenant and need to advertise, handle ten thousand enquiries and calls, then do the legwork to make sure prospects have a good history.
A PM does not
The common misconception is that a real estate is some kind of "insurance" but they provide none of that and they also charge you an hourly fee to go to court/tribunal.
At the end of the day you will still rely on your Landlord Insurance and bond.
When you need to find a new tenant they will happily take your two weeks rent and charge you inflated advertising fees so find you a new tenant.
Advertising is 10 minutes to list and then people just book inspections and apply all online. You can even do your own open home.
Thats thousands of dollars in savings for very little work.
Conflict of interest, I don't think you know the meaning of the term. Arrangements and referral (as an OzB, you know what that is) cuts are entirely normal for almost any professional service, and especially tradies.
The conflict of interest is either because the real estate has interest in resolving the issue as fast as possible so the tenant stops contacting them but there is no interest in making sure that money is used appropriately, they just pass on the bill and then go and manage one of their many other properties.
There is also definitely a conflict with the relationships they have with the tradies. Some definitely have more obvious financial kickbacks but its also all the smaller more hidden things that are going on as they are using designated people. It could be something as simple as making sure they organise the tradie for an out of hours call so they can charge extra fees.
That's a reasonable take.
I don't mean literally like insurance btw, just for the most part, when you're in the steady state part of the lease, it's mostly commission you're paying for, not a service.
But you still are paying for a service. And there's good service and bad service. No doubt there's partnerships with tradies and what not, I wouldn't apply the same malicious intent to all PMs that you seem to be implying. Though no doubt it's more common than most think.
Perhaps my experience is just on the better side. Maybe our PM has a smaller portfolio. Ours has been more than happy to allow our choice of tradie to do work, and has always sent us issues to review first before taking any action themselves.
Of course it's cheaper and we can probably do it better ourselves but we'd rather not. (Insert take away vs home cooked meal analogy)
I wouldn't apply the same malicious intent to all PMs that you seem to be implying. Though no doubt it's more common than most think.
They almost all use designated tradies, and even without malicous intent, why would the tradie give a reasonable price when they know they are the designated tradie? I'm a member of various communities and you can see all the ridiculous quotes property managers are passing on.
I would also say there would be plenty of unwittingly complicit things happenings such as a tradie saying "we are friends, can you do X" and the real estate agrees because its not their money.
Perhaps my experience is just on the better side. Maybe our PM has a smaller portfolio. Ours has been more than happy to allow our choice of tradie to do work, and has always sent us issues to review first before taking any action themselves.
I did not explain why someone should use a property manager, just that they are all a rip off given the pricing structure being very dated (A percentage of rent and taking 2 weeks of rent)
There are plenty of landlords that either don't care enough or don't have the intelligence to understand how to do property management properly and legally and I'm sure plenty of people might identify that they would be that person so they get a property manager.
What I don't agree with is all the gate keeping and exaggerations about what property managers do to make it seem like its a good deal which in turn stops a lot of people from looking into it and realising its very easy for an average intelligence person.
Its completely possible for some people to need something and get completely ripped off at the same time, and thats property managers for you.
@samfisher5986: You clearly have a bone to pick with PMs as your experience seems less than positive (despite still using a PM). It's clear our experiences are very different.
There's also no need to denigrate people who aren't doing their own property management. Just like most people can do their own (complex) taxes - if they read up on everything. Why don't we just do everything ourselves instead of paying someone?
Won't argue the fee structure (though we don't pay for ads, just the one week letting fee). We pay the rural premium commission rate, too.
@ozbargainsam: I don't use a PM but did look at their offers prior to self managing.
There's also no need to denigrate people who aren't doing their own property management. Just like most people can do their own (complex) taxes - if they read up on everything. Why don't we just do everything ourselves instead of paying someone?
Thats essentially my point, you can pay someone set up the emails on your phone or you can learn to do it yourself.
There's nothing wrong with someone who wants to pay but it needs to be understood that its not rocket science as some claim.
Re: Conflict of interest
Yes, my PM sent a quotation of around dollar 3k to fix a plumbing issue. I confronted and had to do some market research spending few hours. Shared the results with the PM and they managed to get someone in to do that same job in $1,800. Had I not paid attention to the quotation I would've lost $1,200 with a large portion of that potentially going into PM's pocket. Definitely a conflict of interest.
There are some really bad property managers out there. Then there are the outright fraudsters.
Years ago we were renting a house, having just moved cities. We rented out our property and rented in the new city. The first Tennant in our property never had a complaint. He fixed the little things himself (say handle was loose on a drawer, a leaking tap etc- little stuff). The next one was alwaua complaining about things including things that were problem(eg a blown light bulb).
In the place we were renting, the owner of the real estate agency was managing. We didn:t have issues, but the actual owner came and did things he thought were due (eg new fly screens).then they decided to hire a property manager. She was offering day 1.she forbid the owner from coming to the property or from doing any repairs himself. The house got hit by a lightning. Strike. We lost some things but the hot water system also got hit. She took several days to fix that. After we had given notice we noticed water in a bedroom and In the dining room. The prime suspect was the kitchen - within the wall behind the tap. Her plumber fixed it - though we weren't convinced and would. It have been happy with the end job (his jack repair to the splash back). When it came to payback our bond, she tried to take off the cost of the repair. I contacted the tennants association to see where I stood. That is when I learned her history.She had tradies on the take who overcharged or even didn't do the job but still charged. She had cost several previous employers quite a bit of money by rulings against them in small claims and other fines - all related to not paying bonds back . I tried to warn the owners of the real estate and the house owners. They were not interested. We went to the Small claims Tribunal and won. She was trying to claim that the leak behind the wall was our fault. I had letters from the Master Plumbers Association and the Manufacturer of our dishwasher (in those days you could attach the hosing to the tap with a connector).
There are fraudsters in all walks of life.
I think these are the costs of renting out a property. Three years, the value of the house increased more than enough to cover any costs of maintaining it, on top of the rental income you are getting. If you have so much free time you are thinking of getting move involved with the management of it, maybe you should ask for more hours at work instead, or start a small business to use up all this extra time and mental energy. Sounds like you bought an existing property and and older one at that. You should probably free your mind of it if you can. House values are expected to go up and up, the million migrants will make sure of that. You don't need to worry about losing on this investment. It'll take decades before the states all increase supply enough, and roll out modern high density housing, before the bubble bursts.
OP is a slumlord in training
An agent is valuable. Choose one using great software automation, with a good list of reliable, reasonably priced trades. Negotiate the % charge and fees. I interviewed 2 and then played them against each other and got a very low rate.
When they wrote to advise of a fee hike, I used ChatGPT to write a letter explaining why the hike was unreasonable. In the end the price increase was reduced by about half.
Check your landlord insurance policy as some require a professional property manager