Using a property manager
Selecting an agent
Real estate property managers must be registered real estate sales representatives or registered property managers. However, both must operate under the supervision of a licensed real estate agent.
If you choose to use a property manager, then consider:
- the person’s experience in property management. Ask about the agency’s management portfolio and the types of properties the agency manages;
- the property manager’s approach to managing your property; for example frequency of inspections;
- the property manager’s manner in dealing with people; and
- the level of fees charged.
What to expect of an agent
If you use an agent just to find a tenant and deal with the bond, then you will pay the agency a ‘letting fee’. If you use an agent just to manage the property and/or collect the rent, then there will be a fee for that.
However, any fees you pay to an agent (and some other expenses) are likely to be tax deductible.
If you decide to engage a property manager, you will need to give the agent written authority to act on your behalf. The document, Exclusive Authority to Act as Managing Agent for Residential Premises, is generally used for this purpose. The agent will have a copy. It provides for you to nominate a fixed-term for the management of the property.
If you use an agent to manage everything, then you should expect the following services:
- advice on matters such as rental values, rent reviews, insurance and any repairs that should be done before the property can be let;
- advertising for tenants;
- selecting tenants and letting the property;
- collecting and lodging the bond in accordance with the Act;
- collecting rent payments;
- preparing and checking the property’s inventory;
- inspecting the property and ensuring it is suitably maintained;
- paying accounts (e.g. water service charges; council rates);
- providing you with regular financial statements;
- attending court on your behalf in any disputes with tenants; and
- at the end of the tenancy, checking the premises and inventory with the tenant and finalising matters relating to the bond.
Make sure all matters you want the agent to handle, and any specific conditions, are listed as clear instructions in the agreement. For instance, before signing the agreement you should ask yourself these questions:
- How often do you want inspections to take place?
- Do you want a copy of the property condition report and inspection reports?
- If a rental payment is late, do you want to be told?
- Do you want the property manager to accompany prospective tenants when inspecting the property instead of handing them a key so they can inspect it alone?
Once you sign an authority for an agent to manage your property, it is binding on both parties for the agreed management period.
Make sure the agent gives you a copy of the agreement.
Remember that an agent cannot be held responsible for the conduct of tenants.
You can find additional information in the publication You and your property manager, which is published by the Real Estate and Business Agents Supervisory Board and available free from the Department.
Be aware
If you use another agent to find your tenants after you give the initial agent exclusive authority, you could be liable to pay a fee to each agent.