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Deciding whether to hire a property manager or self-manage your rental property is a crucial decision for investors. Here’s what you need to know.
When you’ve invested hundreds of thousands of dollars into a rental property, deciding how to manage it is an essential step. Should you hire a property manager or take a hands-on approach and self-manage? Both options have their merits, and choosing the right one depends on your circumstances, time commitment and financial goals. Let’s weigh up the pros and cons to help you make the right choice.
A property manager is a professional who oversees your rental property. They’re often part of a real estate agency, or, in DPN’s case,as specialist service from as part of a property investment firm. A property manager’s key responsibilities include listing the property, finding and vetting tenants, collecting rent, handling tenant concerns, inspections and organising maintenance, plus providing access to all documentation and statements for tax reporting. For their expertise, property managers typically charge 7–10% of your rental income.
Managing a rental property is time-consuming. From advertising vacancies and conducting inspections to liaising with tenants, it can feel like a full-time job. A property manager handles all these tasks, freeing up your time.
Unexpected issues like plumbing emergencies or disputes over unpaid rent can disrupt your schedule. Property managers handle maintenance requests, chase overdue payments, and conduct challenging conversations on your behalf.
Property managers are well-versed in tenancy laws in each state, ensuring you (and your tenants) comply with Australian legal requirements. They manage notices, rental increases, and any disputes with tenants, reducing your risk of costly legal mistakes.
Property managers are emotionally detached from the property, allowing them to make financial decisions with clarity. Whether it’s setting a market aligned rental price or dealing with tenant complaints, their focus is on achieving the best outcome for you while complying with legislation.
The most significant drawback is the management fee, which detracts from your rental income. For those seeking to maximise their returns, this cost needs to be considered, however it can be used as a deduction at tax time.
Not all property managers are equally skilled. Some agencies delegate day-to-day tasks to less experienced staff, which can impact the level of service you receive. With DPN you’ll have one point of contact for all your rental property needs and each property manager has 7-15 year’s experience.
Since property managers often handle multiple properties, yours may not always be their top priority. This can lead to delays in resolving issues or addressing tenant concerns.
Your decision ultimately depends on how much time and effort you’re willing to invest in managing your rental property. If you have the experience, time and resources, self-management might appeal to you. However, for those with busy schedules or multiple investments, hiring a property manager can save time and reduce stress.
From our experience, while self-managing may seem cost-effective initially, the hidden expenses of time and potential mistakes often outweigh the savings. A professional property manager can offer peace of mind, allowing you to enjoy the returns from your investment without the hassle.
At DPN, we provide the full range of property management services for our landlord clients. Our highly experienced and proactive and teamwork with clients to maximise their return on their property investment. We have a guaranteed 24 hour response time as well as extremely low rental arrears and minimal property vacancy rates.
Contact us to find out how we can help you with rental property management. We would be happy to discuss your needs and goals, and to answer any questions that you have.
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