Choosing a Property Manager. Big corporations vs family run business

Discussion in 'Property Management' started by JayM, 11th Sep, 2017.

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  1. JayM

    JayM Member

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    I'm in the process of evaluating PM for property in Melbourne South East suburb.

    At the moment I have a quote from Harcourts and Raywhite and the weekly fees are between 8-9%, and what I find a complex list of fees for different services.


    All things been equal, what would you consider when choosing a PM? for the two quotes I have essentially both real estates are local to the area and are big corporates, I can't tell from a couple of folders with endless information which one will do its best to secure long term and trustable tenants (probably no one will do).

    I have in my mind the idea to have a third quote with a smaller more family run business to see if for example prices are more reasonable as there is, potentially, no big corporations taking a big bite. Not sure in this case or as mentioned with big real estates how to tell which one will provide the best service.

    Don't get me wrong that I only one the cheapest, I am new in the business and I simply don't want to be ripped off for the same service. On thing for sure is that I know I need someone to manage my property instead of the property manage me or my time.

    Thanks
     
  2. DaveM

    DaveM Well-Known Member

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    "Big corporations" are just a family run business with a franchise agreement. You can get excellent name brand pm's and useless ones, same as you can get excellent and uselesss independant operators.

    Referrals are your best starting point.
     
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  3. D.T.

    D.T. Specialist Property Manager Business Member

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    If I had a property there I'd talk to Samantha from Qura property. My mutual clients I have with her say she's worth every penny and then some.
     
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  4. Simon Moore

    Simon Moore Residential & Commercial Mortgage Broker Business Member

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    A second vote for Sam, everyone raves about her service.
     
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  5. Tom Rivera

    Tom Rivera Property Manager Business Member

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    Dave nailed it- those big agencies are almost always franchised. Also great to go with referrals.

    I'm a big fan of 'gut feel', the paperwork is generally just generic marketing hodge podge. How did you like each of the agencies?
     
  6. Anthony Brew

    Anthony Brew Well-Known Member

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    I have learned my lessons with the big corporations. They treat property management as a side business because they get customers easily who purchase the properties that they sell and then get an easy income. They hire crap people on low salaries who end up costing you a lot of money in their incompetence.

    My first preference would be a boutique company that does only property management and not sales. If that was not available, I would avoid the big companies, so in answer to your question, family run business would be my choice.

    Having said that, I would ask to get a recommendation on this forum from someone who is happy with their experience with their PM.
     
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  7. D.T.

    D.T. Specialist Property Manager Business Member

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    Hit the nail on the head here. Combined sales and PM agencies are quite often complacent with their service because they don't have to fight to win or keep their clients like the "boutique" places do.
     
  8. neK

    neK Well-Known Member

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    I'm fan of this too.

    Also, its not so much the company, but the person.
    There are people who truly care about what they do and how it reflects upon them.
    And then there are others that just don't give a crap (and see it as a job).

    I've mentioned the concept of a "lazy" PM - one that is willing to work hard at the beginning to secure an awesome tenant so they don't need do bugger all afterwards.... I like those ones - another way to look at it is the attitude of "do it once, do it right"
     
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  9. D.T.

    D.T. Specialist Property Manager Business Member

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    I hadn't heard of it put like that before, but I like the line thinking. Home opens are almost like an interview in a way - if we're going to have a 12 month (or preferably longer) relationship with someone, we want it to be harmonious and 'easy'.

    Lots of landlords jeopardise this by having poor quality properties to start with, or from their unwillingness to maintain them down the track.
     
    neK likes this.
  10. Zoolander

    Zoolander Well-Known Member

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    Depends on the manager who will be running the day to day affairs. Its important to get someone with a few years experience and has a bit of business acumen, not a "I do this on the side until my uni degree is done" type.

    Have had mixed experiences with both franchises and local self-branded agents.
     
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  11. neK

    neK Well-Known Member

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    Agreed. I know people say you shouldn't renovate an IP like your own PPR - but at the same time, don't leave it as a dump.

    What people need to understand is that using cheaper products or leaving subpar products in only costs in you long term. Callout fees in fixing stuff, replacing items without a chance to shop around (therefore paying higher prices than required), loss of rent when initially looking for a tenant etc.

    I look at the expenses that some people write up about and its shocking. $3k to $5k in "maintenance" with rental income of $15k per year.... in comparison, I've had an average of $300 to $500 in maintenance with rental income of $67k per year. Sure i spent a larger lump sum renovating, but those were all factored into the calculation before the purchase.

    PS: My tenants live in better renovated properties than I do. :(
     
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  12. D.T.

    D.T. Specialist Property Manager Business Member

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    Your PM's must be very glad to have you :)
     
  13. JayM

    JayM Member

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    In general I felt they were honest and they seem to have experience in what they do. The one from Raywhite was very pushy I have to say.

    In both instances when they started to offer their business partners services such as depreciation reports is when I felt that was more like a car dealer selling all the extra protection, insurance and finance for your car. For what you really need you can find better deals shopping around.

    Thanks all. Now I have a better understanding on how to proceed.
     
    Tom Rivera likes this.