Please rate this quote? extreme newbies

We unfortunately have to rent out our PPOR due to it not selling. We spoke to a PM and were sent the following quote. We are extreme newbies at this stage and we will be buying an investment property in the next six months to hopefully offset some of our costs. (I have a lot of learning to do before I jump in boots and all). We are in Perth but our PPOR is in the South West which has taken a major hit on house prices as well as rent LL's can get.

Does this quote seem fair or should we shop around?

* Lease or letting fee is equivalent to two weeks rent (this is charged when new tenants go into
property)
* Monthly management fees 9.6% (includes GST)
* Property Condition Report (includes digital photo’s) $220 (this is once off charge)
* Final Bond Inspection $99 (each time a tenant leaves property)
* Inspections – first inspection is at no charge then quarterly these are charged at $55 each, a typed
report is forwarded to you on each occasion
* Advertising – at cost
* Title Search : $24.50 (if required)
* No charge for tenant enquiries – viewings (individual inspections- not grouped)
* No charge for renewal of lease
* Annual Summary (end of year financial report) $40
* Court appearance $99 per hour up to $300 max

Thanks

 

So you're basing how good / bad they are just on numbers?

Will you get other quotes sort and lowest to highest? Or would you like some guidance on looking for quality?

What area is the property in?

 

As above - obviously quality trumps price. But in saying that compared to what I'm used to in Sydney - those fees are high.
I'd be shopping around to make sure you are getting the best value for your money.

 

As the above peeps have mentioned, price isn't everything. But if you just wanted an opinion about prices, they seem within the normal range for Perth. Not good, but not awfully expensive either.

 

Those fees are fairly typical for WA. Unfortunately there is no correlation between the fee and the quality of the service.

 

That also extends to PMs who charge more than others

 

DT I would definitely like advice on how to spot quality. We are not just basing it on price I would rather pay a higher price and get good service and less hassle renting the property than finding a cheap PM who doesn't do much. I guess being in WA I should by now be used to paying a premium on most things. The property is in Dalyellup in the Southwest so at least two hours away from where we reside now so I don't think self managing is an option especially because I have not had any experience as being a landlord yet.

 

Seems to be the way things are going unfortunately.

A letting fee once used to encompass most costs, now it's a letting fee, condition report fee, advertising costs and such on top.

You have to have that condition report, if there is any damage it can make things way easier for insurance/bond claims

How much is the estimation for advertising

 

The WA costs for management are higher than eastern states.

Seems normal.

 

Exactly who knows.

As an aside where would people look at if they were going to buy an investment property in Perth? It will be our first and I know I need to do a lot of reading and learning and many factors will need to be factored in but are there suburbs we should keep on our radar?

 

Each potential purchase has its own merits.

Asking "what suburb" is a how long is a piece of string question!

Some suburbs will be buy and hold, others with development potential, maybe it will be at land value and require a reno or just sit whilst applications go through, you may even just fall in love with a property and make it your PPOR and to hell with the rest

 

Hmmm boy there seems to be a lot to this Investing game.

 

But in the end it all comes down to borrowing power, what your prepared to spend.

 

No wonder people are not buying up in WA, the fees eat all the CG (or they add to your losses rather)

I have seen WA showing higher rates elsewhere here, but everyone else I know on the East does 1 week as the letting fee, so that seems a bit rich.

 

Hi and welcome!
here a few thoughts about your situation..
Perhaps you might want to consider what it 'will' sell for?
and use that as a comparable?
Also when are most houses selling? ( Which month is usually busier in Perth)
When are tenants looking to move? Ditto
What length of lease do you want?
Will you rent it and put it up for sale at the same time when the market picks up?
Would a tenant 'present the house in good light?
I hope this helps,
and Good luck with this !

 

I can assure you an agency that charges two weeks rent will have at least a one week or $100 releasing fee.

I'll bet my house on it

 

PG
wondering if south west pm fees are actually a tad higher than Perth???

 

Maybe. I have seen some high quotes in Perth too. My point was that even with high fees in WA you will be lucky to find a great PM.

 

How can their fees be maintained when prices in WA have dropped so much and so many businesses are beginning to price drop to meet the challenges in the economy? Is it cheeky to ask for a discount?