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PM quote way under actual cost

Discussion in 'Property Management' started by Jess Peletier, 4th Oct, 2016.

  1. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    Hi all,

    I've never had this before so just wondering what my obligation is - my PM quoted me $90 to get my IP's lawns mowed - actual cost in PM statement was $250. Additional work was also done that I did not request - cleaning of council bins for eg.

    I've emailed her and not yet heard back, so am interested in what am I actually required to pay? Quote was verbal so no evidence as such, unfortunately.
     
  2. D.T.

    D.T. Adelaide Property Manager Business Member

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    Need to check with what work order the PM provided the contractor.

    If work order included those things then it comes down to between you and PM to decide who pays.
    If work order didn't include those things then the contractor did them off their own bat, so they can suffer for it.

    At the end of the day, its not a lot of money and does benefit you - so its probably good that the other stuff was handled rather than building up to become worse and / or being neglected.
     
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  3. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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  4. Colin Rice

    Colin Rice Mortgage Broker Australia Wide Business Member

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    Sometimes contractors do "extra jobs" and charge accordingly and never realy did the "extra job".

    I managed a strata complex back in the day and the lawn contractor would empty lawn clippings into the communual bin and invoice for tip fees. I sacked him and then did it myself :)

    I would be checking, if possible, that the "extra jobs" charged for where actually done.
     
  5. SeafordSunshine

    SeafordSunshine Well-Known Member

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    Hi Jess, I asked for work too be completed, and paid the invoice.
    It wasn't done.
    I confronted the PM when I was in town, and they shouted at me!
    I took my business elsewhere.
    I hope this helps.
    Cheers
     
  6. Chillingout

    Chillingout Member

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    What DT said, not a huge amount if Handyman was Handy and did afew jobs that were needed. But if he charged me 160 to clean my bin i,d want it gold plated
     
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  7. D.T.

    D.T. Adelaide Property Manager Business Member

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    If they're a good handyman and have a $X call out fee which covers their first hour and the presented job only takes half an hour, a great handyman will use the other half hour on whatever else he can find around the place to fix so that their $X is honest.
     
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  8. MyPropertyPro

    MyPropertyPro SE Qld Property Management & Investor Services Business Member

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    I see the premise of the extra work and saving in call out fees etc. (and I always try to group tasks for the same reason where possible) but it's not the PM's nor the tradesperson's prerogative to make those decisions and assign extra work and therefore extra cost beyond the original quoted amount. I would have a huge problem with this as a landlord particularly given it's not maintenance related to the serviceability of the property and it's almost triple the original quoted amount!

    What should happen is that if extra work is deemed to be required whilst on site, the tradesperson should contact the landlord direct or via the PM to obtain authorisation to complete the extra work with an additional quoted amount, or this should be discussed as a possibility prior to the work being carried out and pre-authorised. If it wasn't and the landlord can't be contacted then it's very simple - stick to the original quoted amount and issue a separate work order later if authorised.

    The maximum amounts for maintenance that landlords stipulate on management agreements are there so these things don't need to be subjective (as seems to have been suggested as to it being dependent on what you got for the $160) - if it's beyond this then there is no recourse for the PM to authorise beyond it and if they did, they should pay it. If the tradie "just did it" then it's on them.

    When balancing cash flow across a portfolio it's just not acceptable to be charged an extra $160 for additional work here and there. If it's a PM mistake, I'd be asking them to pay it in accordance with their Accountability Guarantee and if they don't have one, come and and see us ;) Experiences such as these are exactly why we set up one up as I got tired of the lack of accountability from PM agencies. I don't expect there to never be mistakes, but when there is one that would potentially cost me money, as with any other service based industry, I don't expect to have to wear it.

    - Andrew
     
    Last edited: 4th Oct, 2016
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  9. Ricky Adelaide

    Ricky Adelaide PM in Adelaide -Elizabeth Salisbury Modbury Business Member

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    Personally I think this is a relationship issue. While a few people have mentioned authority amounts and service guarantees, you want your PM to be actively working in your best interest. As a business owner, property manager and investor I would not see the point in being upset about 150 dollars as an example, especially if what they did was making sense if it was their property. While we as investors try not to take it personal property managers take criticism from owners harder than from tenants and it's not in your best interest to dishearten them too much if they genuinely are tiring to do the right thing by you. However... If there wasn't value from the extra work being carried out, or you think they are abusing your trust, or that their trade is pulling a fast one that is where they need to realise that in order for the relationship to work they need to be acting in a certain way. Personally if a staff member made the boo boo, I would be fixing this up and working out how we avoid a repeat- basically recapping the communication plan around maintenance for that owner with the owner.

    Personally I find that my owners who give me free range to manage their properties like my own seem to be better off due to the lack of call outs and tradies who can get my approval on the spot- meaning their quoting is not built into their overheads as much(don't say it shouldn't happen because we know it's part of their cost centre). But importantly checks need to be in place so that tradies people are not able to abuse the authority of property managers in this position. So if you are allowing your property manager that kind of authority make sure you know how they will prevent this moving forward.
     
  10. JacM

    JacM VIC Buyer's Agent Business Member

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    Get everything quoted, in writing, and authorize, in writing. No verbal quotes.

    With work orders, I email my PM the precise work that is authorized to send to the tradie, and that if the tradie encounters anything over and above what is ordered, that they should call me when onsite to explain it and seek authorization for the extra work.

    I had a tradie take the absolute mickey once, and it was dealt with appropriately. The ridiculous invoice was rejected and requested to be reissued at original quote plus 10%.
     
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  11. Xenia

    Xenia Adelaide Property Manager Business Member

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    Did the maintenance people under quote?

    Sometimes they do this and a PM would not be able to pick up that it's under quoted.
     
  12. Xenia

    Xenia Adelaide Property Manager Business Member

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    Did the maintenance people under quote?

    Sometimes they do this and a PM would not be able to pick up that it's under quoted.
     
  13. dabbler

    dabbler Well-Known Member

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    Hi Jess,

    This sort of thing is not acceptable IMO, if they are mowing the lawn, then that is what they are doing, not a bunch of other odd jobs to fill in time. Lawn mowing is not a highly technical or variable thing IMO & nothing excuses them getting ok to go ahead if there was a major under quote.

    But if they were doing some repairs to the roof let's say, and there was an extra few hundred dollars required to make the roof water resistant, or stop some other large problem, you would expect them to fix, but I would also expect that they try to notify of the extra problem and cost and try to contact straight away.

    I do not think more than doubling of a quote is ok, as others say, work out who took liberty to do this & take it from there.

    PS If you have multiple IPs and you allow say 100 extra on each one each month, this ads up, it also tells the PM your ok with them just doing as they like, I have a zero $ spend with all PMs and always have, it stops the BS if they know your watching & the good PMs are not ever offended by owners watching the property.

    PS PS Turn it around the other way, if you were doing a loan for the PM & the application fee was $100, would you just go ahead and bill them 250 because it has gone up or whatever, or would you inform them first out of courtesy, good business practice & avoiding silly arguments or them refusing to sign the docs once you did everything ?
     
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  14. Dean Collins

    Dean Collins Well-Known Member

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    what I find ridiculous here is $90 to mow lawns......

    what the heck is happening in Australia that we no longer value the cost of a dollar.
     
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  15. WattleIdo

    WattleIdo renovating Premium Member

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    The whole situation is absurd. Get a back-bone, girl.
     
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  16. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    Ha! Backbone is just fine thanks - just curious as to actual legal rights. As I said, it's a first for me.
     
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  17. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    I may be misinterpreting but are you saying this is expensive?

    When the alternative is doing it myself it's loose change.
     
  18. jins13

    jins13 Well-Known Member

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    I recently paid $80 to do the lawns.
     
  19. Dean Collins

    Dean Collins Well-Known Member

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    Yes am saying its too expensive.

    And if you think $90 every 6 weeks is loose change......then you have too much money :)

    I really do worry about the long term viability of Australia and how inflationary everything is getting.
     
  20. Dean Collins

    Dean Collins Well-Known Member

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    Its the same reason why we no longer have a car industry.....we flick off the "hard stuff" and pretend white collar will save us.....newsflash China will be the same white collar in 20 to 30 years then where will we be? (especially if they invent some kind of "free fuel" and say get stuffed to our LNG and Coal etc).