What to look out for in Rental Agents - LAUNCESTON

Discussion in 'Property Management' started by eask, 15th Jan, 2018.

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  1. eask

    eask Member

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    AUSTRALIA
    Hi I'm Eask, I have just bought my first property in Launceston and now looking for a rental agent.
    The first question was to ask if I was from the mainland. Then they proceed to tell me that rates are generally 9.5%... some have offered 8.5%

    1. Is this a normal rate for Launceston? or am I being ripped off?
    2. apart from management fees, what else do you look for in a Rental agent?

    Thanks!

    Eask
     
  2. Anthony Brew

    Anthony Brew Well-Known Member

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    For the AGENCY :
    Has the property agency or agency owners experienced past financial difficult or have they ever been bankrupt?


    All other questions, you need to ask the actual PROPERTY MANAGER.
    Ask the agency who the PROPERTY MANAGER will be since that is who will be managing your property, not the agency or the sales or customer service people.


    A. General questions

    1. How long have you been with this agency?
    (Staff turnover can be high. Need someone who will be there when there are problems.)
    (Also this will show you they have at least been in property management for a while as well as in the local area for a while)

    2. Are you a member of any regulatory agency such as the real estate institute?

    3. How many properties do you looks after?
    (200 is a rule of thumb, but depends on if they have support staff to help)
    4. Do you have support staff or is it just you?
    (If it's just them, who can manage the property in their absence?)


    B. Looking for a new tenant

    1. How will you determine the rental value of my property and do you provide comparable rentals?

    2. Do you do tenant checks - and which types of checks

    Should be all of these below.
    Be wary if they leave any out and say "I trust my instinct so no need for tenant DB check" - I had this the other day, and of course am not going with them.

    100 points of ID
    Call last real estate agent
    Call employer
    Tenant DB checks
    Bank statement to show they are not living day and can actually save money to avoid them going into arrears.

    3. Do you do thorough ingoing and outgoing inspections and do you provide detailed reports with photos?
    If there is damage, photos are what will prove that there was no damage there before hand.
    Because of this, it takes them time to take photos and make a full report, so if their management fees or letting fees are slightly higher than the cheapest company, it will be worth it.


    C. Ongoing work

    1. How often do you conduct inspections (should be after 3 months and then every 6 months after that. one agency said they do 12 monthly but can do 6 monthly if requested - make sure you request this if that is what they say)
    2. Do you provide detailed inspection reports with accompanying photos of any damage that should be recorded? Ask to see an example of their report.
    3. Can you explain the steps you take to follow up tenants who are late making rental payments?


    D. Nearing the end of a lease

    1. Towards the end of a lease, what is your process?
    (they should initiate contact with you X months before in time to provide you with your market rental review, send out increase rent notice, termination of current lease notice, and new contract to sign, and send it out by registered post with enough time to arrive before the date required by your state. they should not be letting it go to periodic without notifying you and you explicitly requesting this and unless you plan to have them vacate within the following 12 months you should instruct them to not go to periodic)


    E. Costs

    This is kinda dependent on a few things (including which state you are in as they are different in each city).
    I used to think a lease renewal fee was ridiculous since they are just taking a piece of paper to sign, but if the rest of their fees are good and they do initiate contact with you before lease end and do provide comparable and actually do their job, then half a week is ok with me. If the rest of their fees are high, then I would ask for a flat fee (normally like $30-$100) or just the lease preparation fee of like $30.

    Make sure that no more than a 30 days termination notice is required. If they say 90, then say you would like 14 days (which is more than enough to do a handover) and they normally want to scrape out anything they can from you and come back with 30, which is not a big deal to me. $100 to get your property out of the management of an agency who is screwing it up is a small fee to pay, and this is why -

    I ALWAYS get them to put in writing in the contract:
    "In the event of termination by the principal, hand over can commence as soon as all monies owed to date of termination have been paid"
    Reason for this is that if you are looking for a new tenant and they really are terrible, an extra few weeks of vacancy is over $1,000 lost by being stuck with them. So I want to make sure it is in writing that I can walk the very day I have found someone else instead of being held to ransom (provided I have paid them out for the 30 days notice).



    Notice that management fees are the last question I ask, because if I actually make it to that question, I will be willing to pay a bit more than the standard rate.

    Also these are a lot of questions. I suggest asking about half or even less in the initial chat, and then call or email to ask the others on a second interaction. They might freak out a bit if you ask all that the first time you meet them.


    Golden rules for dealing with property managers:

    Always interview your property manager.
    Once hired, have a list of things that to look for that they are doing their job once you have hired them so you are basically watching and sometimes even managing them until they have shown that they are actually doing their job. Otherwise they can miss steps which will cost you a lot of money. Know what to look for and put dates in your diary to remind you when things should be happening so you know if they are or are not doing it.
    Don't be afraid to leave if they have not been doing their job.
    An extra 1% or even 1.5% is worth it if they actually do the job well. Very few seem to do their job well, so if you actually find someone good, value them because they really are the exception and you should appreciate them.
     
    craigc, eask, Tom Rivera and 2 others like this.
  3. Tom Rivera

    Tom Rivera Property Manager Business Member

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    I LOVE this.
     
  4. eask

    eask Member

    Joined:
    15th Jan, 2018
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    Location:
    AUSTRALIA
    That's amazing!!
    Thanks so much!
     

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