landlords

6 reasons to manage your rental property yourself

Truecasa wants to see more privately managed rental properties and fewer real estate agent managed properties. But why would you make the decision to do it yourself? Here are 10 great reasons why you should become a private landlord for your rental property.

1. Save money on property management fees

Typically real estate agents charge between 6% and 12.5% of your rental income as a management fee. This is charged as well as property maintenance fees, leasing fees, property or landlords insurance, advertising and even a monthly postage levy in some cases.

The average weekly rent in Melbourne for the last quarter of 2009 was $330. That works out to $1430 a month or $17,160 a year. By not using a rental property manager you will save between $1029 and $2145 a year - for many properties that winfall will comfortably cover annual council rates charges or property insurance.

2. Find the right tenants.

When you manage the property yourself you’ll be a part of the process of finding new tenants. This means that you can find tenants from your social networks (whether through Facebook, work or social connections) and decide on who you want to live in the property.

Often real estate agents will select tenants based on who can pay the highest amount of rent rather than who might be the best applicant for your property. Choosing the tenants yourself will give you the opportunity to personally vett them and find the right ones for you.

3. You’ll always be in the loop.

When you’re managing your property yourself you become the direct contact for the tenants. You get to see when rent is paid on time and when it’s not as well as finding out any issues with your property.

If you’re collecting the rent in-person you’ll also be visiting your property once a month to at least get a superficial look at how it’s going.

4. Your property will get looked after better.

When your tenants can put a name and a face to the owner of the property they’re more likely to empathise with you. This leads to them showing greater respect for you and your property in turn. They’re less likely to skip out on rent or leave the property in poor condition when they’ve got a personal relationship with you.

5. Perform your own property maintenance.

By managing the property yourself you can also perform simple property maintenance work yourself. This may be as simple as replacing lightbulbs or unblocking a sink. By being able to inspect the problem you will be able to make your own judgement on how to rectify it and possible save yourself hundreds of dollars.

If  you do need to get a licensed trademan in such as an electrician or plumber you will at least have a better understanding of what work is required and how much it should cost. This means you won’t be lumped with any unwanted bills.

Alternatively there are a range of all-in-one property maintenance companies like Jim’s Building Maintenance who will assess and quote for you. Once approved they will then perform the work, liasing with you and the tenant the whole time to ensure the job is done with the minimum of hassle for all parties.

6. Your tenants will love you.

Take this from someone who has dealt with property managers for over 10 years: real estate property managers are rarely pleasant to deal with. Unfortunately the nature of the real estate industry means that property managers are some of the least qualified, lowest paid and overworked people in the real estate industry. This translates to some highly stressed people with a focus on retaining their rental properties rather than looking after the tenants needs as well.

In an average real estate shop a property manager will be a recent entrant to the real estate industry with a 4 to 8 week training course under their belt and 150+ properties to look after. The stress of the position often translates to tenants not being given the best level of customer service.

By removing the real estate agent from the equation and being able to give some one on one time with your tenants they will love you. You’ve just removed 90% of the stress from the process of renting a property and in return they will respond with the same level of respect in return.

Sound like good reasons? What’s holding you back?

Ned

Tags: manage your own rental property, private landlords, property managers, real estate