Are there risks with self-managing my property?
Owning a rental property is a great way to build your investment portfolio and diversify your assets as you plan your life into retirement. When you do purchase you will find the decision to either have the property managed or self-manage.
Employing a property manager to take care of the intricacies of property rentals can remove potential stress from the day-to-day care of the property and tenant management while maximising your investment.
Alternatively, you may have the time and the resources to self-manage the property. If this is a strategy that you choose, be aware of the risks and benefits of self-management.
One financial benefit of self-management is that no management fees are charged from an agency. These fees can range from management fees to letting fees, leasing, representation at tribunal, advertising and marketing and other ancillary fees. However, the management fees are tax deductible.
You will also have a more hands-on approach with the management of the property as you will be dealing with the tenants, rental payments, and day-to-day maintenance. It provides you with more control as you meet with and approve tenants and you are required to build a relationship with them throughout the tenancy.
While there are some benefits, it is worth weighing up the financial costs with the implications of self-managing, especially should things go wrong.
Hiring a professional property manager can reduce stress as they have the most up-to-date knowledge and training of the relevant acts and legislation surrounding rental properties. They can navigate any challenges that may arise with tenants including representation at tribunal and insurance claims if required.
A property manager will manage the collection of rental funds and make sure that the tenants are paying their rent on time according to the agreed schedule, and should they fall into arrears, they will take the required relevant action.
The time it takes to show tenants through properties, process applications, and prepare the required lease documents and condition reports add up. A property manager and their team can give you back these precious hours by including them as part of their service and fees package.
Consider how much your time is worth and analyse the costs associated with self-managing when weighing up your time and choosing to have the property managed by an agent. Your time is precious, and a property manager can help you get this time back.
They will also have a list of licensed and insured preferred suppliers that will attend to your property and ensure that work is carried out to a satisfactory standard at a reasonable cost and help to mitigate any losses to you.
If you would like to compare self-management to having your investment property professionally managed, you can contact our property management team to discuss how we can help.
