Financial Benefits of Professional Property Management
Most experienced, long-term property investors use professional property managers and wouldn’t consider taking on the workload of managing their rental properties themselves.
Yet some ‘newbies’ try to go it alone, questioning whether the cost of management services is financially justifiable.
We believe engaging professional management is a smart investment that pays dividends in the long run.
Here’s why:
Property Managers Add Value
Research shows effective property management brings significant benefits to property investors. Some of these advantages are not immediately obvious.
We’ll share with you what makes hiring the right property manager a strategic move. We hope this will support your long-term success as an investor!
What Kind of Financial Benefits Accrue When a Property is Managed Effectively?
Financial benefits are created when your property manager:
- increases your income
- reduces your costs
- saves you time that you can invest effectively elsewhere.
Make More Money
A professional property manager has experience and access to industry data. Their inside knowledge can help you maintain cash flow, avoid losses due to prolonged vacancies, and earn more from your property overall.
Property managers are experts at:
- understanding what tenants want
- maximising property appeal
- assessing what rent is achievable
- marketing to attract quality applicants
- negotiating premium rents
- minimising tenant turnover/vacancy periods
- thoroughly vetting applicants on industry databases / with referees
- monitoring payments, minimising late payments/rent defaults
- maintaining/improving properties, enhancing capital value
- safeguarding the landlord’s insurance*.
*landlord’s insurance policies can be voided if, for example:
- a property is vacant for too long
- tenants run a business from home
- tenants fall into arrears, and this is not handled correctly.
Save Money
Skilled property managers reduce client costs over the long term.
Ways property managers achieve this include:
- making regular inspections
- detecting problems early and before more expensive deterioration occurs
- recommending planned maintenance, for example:
- pruning trees (decreases the risk of falling branches / blocked gutters)
- cleaning gutters (avoids damage from overflows)
- servicing equipment e.g. air-conditioners and pool pumps (minimises breakdowns)
- identifying potential safety issues, e.g. unstable balconies, or trip-and-slip hazards/advising on rectification (minimises harm and associated claims)
- arranging competitively priced repairs, using insured, qualified contractors
- negotiating disputes effectively, avoiding costly court proceedings
- advising their clients on how to avoid legal risks / remain compliant*.
* Achieving full compliance with laws and regulations can be challenging. Some landlords struggle to stay up to date with the Residential Tenancies Act alone, and don’t realise the impact of other laws, such as the:
- Australian Consumer Law
- Building Codes / Regulations / Australian Standards
- Strata Titles Act
- Equal Opportunity Act
- common law.
Professional agency staff keep up to date, advising clients on how to avoid legal breaches. They help owners to avoid:
- government penalties e.g. for breaching the Residential Tenancies Act
- personal injury claims, under Consumer Law or building codes
- penalties for breaching strata by-laws
- discrimination complaints
- claims for compensation based on the landlords’ common law duty-of-care
An effective property manager foresees risks… and heads them off.
Save Time
Every service a property manager provides saves their client’s time. For investors with other business interests, time is money.
Property managers also take on the time drain (and stress) of dealing with tenants and tradespeople, and that can be gold!
They have the systems and experience to do management tasks more efficiently and provide quality financial records for tax purposes.
Fees are generally tax-deductible, a factor in calculating financial benefits.
What Should I Do Next?
The professional team at We Love Rentals only manage investment properties – we are dedicated experts.
For more information, see the benefits of using a property manager.
We understand owners are looking for returns, and we pride ourselves on adding value! So why not call us for a chat?
Why not email us or call (08) 6254 6300 for friendly, professional advice.
Brendan Leahy
I am the licensee of We Love Rentals and provide support to the team whenever needed. I began my real estate career over two decades years ago. While I loved seeing people achieve their dream of a new home for their family, I kept thinking that there had to be a better way of doing real estate – one with respect for the long term benefit of the client and one that focuses on customer satisfaction.
